Building Customer Value Through Products and Services

1. Chapter Eight Products, Services, and Brands: Building Customer Value

2. Product, Services, and Branding Strategy What Is a Product? Product and Services Decisions Branding Strategy: Building Strong Brands Services Marketing Topic Outline

3. What Is a Product? Product is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want Products include more than just tangible objects such as cars, computers or cell phones. Products, Services, and Experiences

4. What Is a Product? Broadly defined, “products” also include service, events, persons , places , organizations , ideas , or mixes of these. Services are the form of product that consists of activities, benefits or satisfactions offered for sale that are essentially intangible and don’t result in the ownership of anything such as Banking Products, Services, and Experiences

5. What Is a Product? Product is a key element in the overall marketing offering, marketing mix planning begins with building an offering that brings value to target customers. This offering becomes the basis upon which the company builds profitable customer relationships A company’s market offering includes both tangible goods and services Products , services and experiences

6. What Is a Product? The offer may consist of a pure tangible good such as soap, toothpaste or salt. At the other extreme are the pure services for which the offer consists primarily of a service. Products , services and experiences

7. What Is a Product? Experiences represent what buying the product or service will do for the customer Experiences have always been an important part of marketing for some companies Companies that market experiences realize that customers are really buying much more that just products and services, they are buying what those offers will do for them Products , services and experiences

8. A ________ is anything that can be offered to a market that might satisfy a need or a want. position product promotion none of the above

9. A ________ is anything that can be offered to a market that might satisfy a need or a want. position product promotion none of the above

10. What Is a Product? Product planners need to think about products and services on three levels, each level adds more customer value. The most basic level is the core customer value, which addresses the question “ what is the buyer really buying ? “ When designing products, marketers must first define the core, problem solving benefits or services that consumers seek Levels of Product and Services

11. What Is a Product? At the second level, product planners must turn the core benefits into an actual product, they need to develop product and service features, design, a quality level or a brand name and packaging. For Ex. The BlackBerry is an actual product. Its name , parts, styling, features have all been combined to deliver the core customer value Levels of Product and Services

12. What Is a Product? Finally , product planners must build an augmented product around the core benefit and actual product by offering additional consumer services and benefits. For ex. The BlackBerry solution offers more than just a communication device, it provides customers with a complete solution to mobile connectivity problems. Levels of Product and Services

13. What Is a Product? Levels of Product and Services

14. The most basic level of a product is called its ________. augmented product actual product core benefit position

15. The most basic level of a product is called its ________. augmented product actual product core benefit position

16. What Is a Product? Product and Service Classifications

17. What Is a Product? Consumer products are products and services for personal consumption Classified by how consumers buy them • Convenience products • Shopping products • Specialty products • Unsought products Product and Service Classifications

18. What Is a Product? Convenience products are consumer products and services that the customer usually buys frequently, immediately, and with a minimum comparison and buying effort Newspapers Candy Fast food They are usually low priced, and marketers place them in many locations to make them available when consumers need them Product and Service Classifications

19. What Is a Product? Shopping products are consumer products and services that the customer compares carefully on suitability, quality, price, and style Furniture Cars Shopping products marketers distribute their products through fewer outlets but provide deeper sales support to help customers in their comparison efforts. Product and Service Classifications

20. What Is a Product? Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort Medical services Designer clothes Buyers normally don’t compare specialty products, they invest only the time needed to reach dealers carrying the wanted products Product and Service Classifications

21. What Is a Product? Unsought products are consumer products that the consumer does not know about or knows about but does not normally think of buying Life insurance Funeral services Blood donations Unsought products require a lot of advertising, personal selling, and other marketing efforts Product and Service Classifications

22. What Is a Product? Industrial products are products purchased for further processing or for use in conducting a business Classified by the purpose for which the product is purchased • Materials and parts • Capital • Supplies and services Product and Service Classifications

23. Types of consumer products include convenience products, shopping products, specialty products, and ________ products. unique luxury unsought all of the above

24. Types of consumer products include convenience products, shopping products, specialty products, and ________ products. unique luxury unsought all of the above

25. ________ products are purchased frequently, with little comparison or shopping effort. Convenience Shopping Industrial Unsought

26. ________ products are purchased frequently, with little comparison or shopping effort. Convenience Shopping Industrial Unsought

27. Consumer product with unique brand identification for which buyers are willing to make a special purchase effort is called _________ product. convenience shopping specialty unsought

28. Consumer product with unique brand identification for which buyers are willing to make a special purchase effort is called _________ product. convenience shopping specialty unsought

29. ________ products are those purchased for further processing or for use in conducting a business. Industrial Shopping Unsought Physical

30. ________ products are those purchased for further processing or for use in conducting a business. Industrial Shopping Unsought Physical

31. What Is a Product? Capital items are industrial products that aid in the buyer’s production or operations Materials and parts include raw materials and manufactured materials and parts usually sold directly to industrial users Supplies and services include operating supplies, repair and maintenance items, and business services Productand Service Classifications

32. Your visit to a doctor’s office is an example of a ________. pure tangible good pure intangible good unsought product impure tangible good

33. Your visit to a doctor’s office is an example of a ________. pure tangible good pure intangible good unsought product impure tangible good

34. What Is a Product? Organization marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward an organization Both profit and non profit organization practice organization marketing Business firms sponsor public relations or corporate image advertising campaign to market themselves and polish their images Organizations, Persons, Places, and Ideas

35. What Is a Product? Person marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular people. People use person marketing to build their reputation Organizations, Persons, Places, and Ideas

36. What Is a Product Place marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular places Social marketing is the use of commercial marketing concepts and tools in programs designed to influence individuals’ behavior to improve their well-being and that of society Organizations, Persons, Places, and Ideas

37. What Is a Product Social marketing programs include public health campaigns to reduce smoking , alcoholism, drug abuse, and obesity Other social marketing efforts include environmental campaign to promote clean air and conservation Still others address issues such as family planning and human rights and racial equality Organizations, Persons, Places, and Ideas

38. Product and Service Decisions Individual Product and Service Decisions

39. Product and Service Decisions Product attributes are the benefits of the product or service Quality Features Style and design Individual Product and Service Decisions

40. Product and Service Decisions Quality has a direct impact on product or service performance, thus , its closely linked to customer value and satisfaction. Quality can be defined as “ freedom from defects” The American society for quality defines quality as the characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs Individual Product and Service Decisions

41. Product and Service Decisions Product quality includes level and consistency Quality level is the level of quality that supports the product’s positioning Conformance quality is the product’s freedom from defects and consistency in delivering a targeted level of performance Individual Product and Service Decisions

42. The two dimensions of product quality are ________ and ________. value; features style; design level; consistency style; value

43. The two dimensions of product quality are ________ and ________. value; features style; design level; consistency style; value

44. Product and Service Decisions Product features are a competitive tool for differentiating a product from competitors’ products Product features are assessed based on the value to the customer versus the cost to the company Individual Product and Service Decisions

45. Product and Service Decisions Style describes the appearance of the product Design contributes to a product’s usefulness as well as to its looks. It goes to the very heart of a product Individual Product and Service Decisions

46. Product and Service Decisions Brand is the name, term, sign, or design—or a combination of these—that identifies the maker or seller of a product or service Brand equity is the differential effect that the brand name has on customer response to the product and its marketing Individual Product and Service Decisions

47. Product and Service Decisions Branding helps buyers in many ways. Brand names help consumers identify products that might benefit them. Brands also say something about product quality and consistency Buyers who always buy the same brands know that they will get the same features , benefits and quality each time they buy. Individual Product and Service Decisions

48. Product and Service Decisions Packaging involves designing and producing the container or wrapper for a product The primary function of the package was to hold and protect the product Individual Product and Service Decisions

49. Product and Service Decisions Labels range from simple tags attached to products to complex graphics that are part of the package Labelsidentify the product or brand, describe attributes, and provide promotion Individual Product and Service Decisions

50. Product and Service Decisions Product support services augment actual products Individual Product and Service Decisions