Managing Product Lines and Brands -10

8/3/2019 Managing Product Lines and Brands -10

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MANAGING PRODUCT LINES AND

BRANDS

CHAPTER 10


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THE PRODUCT AND PRODUCT MIX

A Product is anything that can be offered to a

market to satisfy a want or need.

Product that are marketed include: Physical

goods, services, experiences, events, persons,

places, properties, organizations, information,

and ideas.


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PRODUCT LEVELS

There are five levels of the product. Each level

adds more customer value, and the five

constitute a customer value hirarchy.

The most fundamental level is the core

benefit: The fundamental service or benefit

that the customer is really buying.

Ex: A hotel guest is buying rest and sleep.


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At the second level, the marketer has to turn the

core benefit into a basic product .

Ex: A hotel room includes: a bed, bathroom, towels,

desk, etc.

At the third level, the marketer prepares an

expected product. a set of attributes and

conditions buyers normally expect when they

purchase this product.

Ex: A hotel guests expect a clean bed, fresh towels,

working lamps, and a relative degree of quiet.


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At the fourth level, The marketer prepares an

augmented product, that exceeds customerexpectations.

EX: A hotel can include a remote-control television set,

fresh flowers, rapid check-in, express checkout, etc.

At the fifth level is Potential product, which

encompasses all the possible augmentations and

transformations the product might undergo in thefuture.


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Successful companies add benefits to their

offering that not only satisfy customers but

also surprise and delight them.

Delighting is a matter of exceeding

expectations.

Ex: The hotel guest finds candy on the pillow or

a bowl of fruit, etc.


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PRODUCT CLASSIFICATIONS

Marketers classified products on the basis of

characteristics:

- Durability

- Tangibility- Use

Each product type has an appropriate marketing-mixstrategy.


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DURABILITY AND TANGIBILITY

Products can be classified into three groups,according to durability and tangibility:

1. Nondurable goods Nondurable goods are tangiblegoods normally consumed in one or a few uses : beerand soap. Because these goods are consumedquickly and purchased frequently, the appropriate

strategy is to make them available in many locations,charge only a small markup, and advertise heavily toinduce trial and build preference.


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2. Durable Goods

Tangible goods that normally survive many uses:refrigerators, machine tools, clothing.

Normally require more personal selling and service,

and require more seller guarantees

3. Services are intangible, inseparable, variable, and

perishable. Normally require more quality control,

supplier credibility and adaptability.

Ex: raircuts and repairs.


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Consumer-Goods Classification

1. Convenience Goods are goods that the customerusually purchases frequently, immediately, and witha minimum of effort.

Ex: Tobaco products, soap, newspapers.

2. Shopping Goods are goods that the customer, inthe process of selection and purchase,characteristically compares on such bases as

suitability, quality, price and style.

Ex: Furniture, clothing, and major appliance.


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3. Specialty Goods are goods with unique

characteristics or brand identification for which asufficient number of buyers is willing to make a

special purchasing effort.

Ex: Cars, stereo components, photographic

equipment, etc

4. Unsought Goods are goods that the customer

doesn`t know about or doesn`t normally think ofbuying.

Ex: life insurance, gravestones, encyclopedias.


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PRODUCT MIX

Is the set of all products and items that a particularseller offers for sale.

A company`s product mix has a certain Width,

Length, Depth and consistency. The width of product mix refers to how many

different product lines the company carries.

The length of product mix refers to the total number

of items in the mix.


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The depth of a product mix refers to how many

variants are offered of each protduct in the line.

The consistency of a product mix refers to how

closely related various the product line are in enduse, production requirement , distribution channels.

These four dimensions are the tools for developing

the company`s marketing strategy, and deciding

which product lines to grow, maintain, harvest and

divest.


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BRAND DECISIONS

A Brand is: a name, term, sign, symbol or design ora combination of them or group of sellers , intended

to identify the goods or services of one seller or

group of sellers and to differentiate them from thoseof competitors

The best brands convey a warranty of quality.


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Brand can can convey up to six levels of

meaning:

1. Attributes A brand brings to mind certainattributes. Ex: Mercedes suggests expensive, well-built, well-engineered, durable, high-prestigeautomoblies.

2. Benefits Attributes must be translated intofunctional and emotional benefits. TheattributesDurable could translate into the

functional benefit I won`t have to buy another carfor several years. The attribute expensive

translates into the emotional benefit The carmakes me feel important and admired.


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3. Values The brand also says something about theb

producer`s values. Ex: Mercedes stands for highperformance, safety, and prestige.

4. Culture The brand may represent a certain culture.The Mercedes represent German culture: organized,efficient, high quality.

5. Personality The brand can project a certainpersonality. Ex: Mercedes may suggest a no-nonsenseboss (person), a reigning lion.

6. User The brand suggest the kind of consumer whobuys or uses the product. Ex: We would expect to see a55- year-old top executive behind the wheel of themercedes, not a 20-year-old secretary.


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BRAND EQUITY

The degree of brand name recognition,perceived brand quality, strong mental and

emotional associations, and other assetssuch

as: patents, trademarks, and channelrelationships


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High brand equity provides a number of

competitive advantage

1. The company will enjoy reduced marketing costs

because of consumer brand awareness and loyalty

2. The company will have more trade leverage in

bargaining with distributors and retailers becuasecustomers expect them to carry the brand

3. The company can charge a higher price than it`s

competitor because the brand has higher perceived

quality.


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4. The company can more easily launch

extensions because the brand name carries

high credibility.

5. The brand offers the company some defense

againts price competition.


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The Major Purpose Of Brand

1. The brand name makes it easier for the seller to

process orders and track down problems

2. The seller`s brand name and trademark provide

legal protection of unique product features3. Branding gives the seller the opportunity to attract

a loyal and profitable set of customers. Brand

loyalty gives sellers some protection from

competition.


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4. Branding helps the seller segment markets. Each

formulated differently and aimed at specific benefit-

seeking segments.

5. Strong brands help the corporate image, making iteasier to launch new brands and gain acceptance by

distributors and consumers.


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The Desirable Qualities For A Brand Name:

1. It should suggest something about the product`sbenefits.

2. It should suggest product qualities such as action orcolor

3. It should be easy to pronounce, recognize, andremember. Short names help

4. It sholud be distinctive . Ex: Mustang, Kodak, Exxon

5. It sholud not carry poor meanings in othercountries and languages. Ex. Nova is a poor namefor a car to be sold in spanish-speaking countries; itmeans doesn`t go.


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BRAND-STRATEGY DECISION

1. Line Extensions Existing brand name extended tonew sizes, or flavors in the existing product category

2. Brand extensions Brand names extended to newproduct categories.

3. Multibrands New brand names introduced in thesame product category)

4. New brands New brand name for a new category

product5. Cobrands Brands bearing two or more well-

known brand names.

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Managing Product Lines and Brands -10