Products, Services and Brands

1. Products, Services and Brands

2. The Product-Service Continuum Restaurant Sugar Education Pure Tangible Good Pure Service Offer another example of a pure service.

3. What Is a Product? • Anything offered to a market that satisfies a want or need. • Includes: physical objects, services, events, persons, places, organizations, ideas, or some combination thereof.

4. What Is a Service? • Activities, benefits, or satisfactions offered to a market that are essentially intangible and do not result in the ownership of anything. • Examples: banking, hotel, airline, retail, tax preparation, home repairs.

5. Consumer Experiences • In-store Theater is more important than ever • Consider ALL consumer touch-points • Eliminate shopping drudgery • Work fun into the shopping experience, but don’t overdo it Knot Tying Clinic Art GalleryEntrance

6. Three Levels of Product

7. Convenience Goods Bought frequently and immediately Low price Many purchase locations Examples: candy, soda, newspapers Shopping Goods Bought less frequently High price Fewer purchase locations Comparison shop Examples: cars, furniture, appliances Convenience & Shopping Products

8. Specialty Products Special purchase efforts High price Unique characteristics Brand importance Few purchase locations Example: Rolex watches, Ferrari cars Unsought Products New innovations Consumers may not want to purchase or think about them Examples: blood donation, cemetery plots, insurance Specialty & Unsought Products

9. Individual Product Decisions

10. Product Attributes What is an attribute? • Quality • Performance vs. Conformance quality • Benefits vs. Features • Consumers generally value benefits, not features • Style and design • Influences product choice and experience • Price

11. Branding • A brand is a name, term, sign, symbol, or design, or a combination of these that identifies the maker or seller of a product or service. • Product = “Body” • Brand = “Soul”

12. Branding - Advantages • Advantages to buyers: • Eases product identification • Simplifies the purchase process (choice heuristic) • Signal of quality • “Repository of Trust” (- Jordan) • Advantages to sellers: • Drive loyalty to company and its products • Provides legal protection • Helps segment markets (i.e. “Branded Variants”)

13. How Branding Happens

14. Excels at delivering desired benefits Stays relevant Priced to meet perceptions of value Positioned properly Communicates consistent brand messages Well-designed brand hierarchy Uses multiple marketing activities Understands consumer-brand relationship Supported by organization Monitors sources of brand equity Attributes of Strong Brands

15. Improved perceptions of product performance Greater loyalty Less vulnerable to competition Less vulnerable to crises Larger margins Inelastic consumer response to price increases Elastic consumer response to price decreases Greater trade cooperation Increase in effectiveness of IMC Licensing opportunities Brand extension opportunities Marketing Advantages of Strong Brands

16. Packaging • Container, wrapper or “external face” for a product. • Good packages • market the brand effectively • protect the internal elements • protect the external elements • are easy/straightforward to use • don’t become “stale” over time • ensure consumer’s safety • are responsive to local environmental and social concerns

17. Innovative Packaging Dutch Boy’s packaging innovation offers paint in plastic containers with twist-off tops. The paint container is easy to carry, doesn’t need a screwdriver to pry open, doesn’t dribble when poured, and doesn’t take a hammer to bang the lid shut.

18. Labeling • Printed information appearing on or with the package. • Performs several functions: • Identifies or reinforces identification of product/brand • Provides “valuable” information about product contents or ingredients • Co-promotes the product along with packaging

19. Labeling The FDA now requires food manufacturers to list trans fat on the Nutrition Facts portion of product labels.

20. The Ethics and Legality of Labeling

21. Product Line Decisions • Product Line • Group of products with variations (flavors/types/appeals). • Product Line Stretching • Downward • Upward • Both directions • Product Line Filling • Examples • Ice Tea • Pet Foods

22. Product Line Stretching - Marriott Marriott offers a full line of hotel brands, each aimed at a different market.

23. Product Mix Decisions • Product mix: • What combination of products do we carry? • Product mix decisions: • Product Line Length:the number of items in a line. • Product Line Width: the number of different product lines the company carries. (i.e. Wal-Mart has toys, food, cards, clothes, music, etc.) • Product Line Depth: the number of versions offered of each product in the line. (i.e. 2 or 3 different sizes or sub-types)

24. Question du Jour Is productvariety a blessing or curse for consumers?

25. Brand Loyalty & Brand Equity • Brand Loyalty • Definition: Willingness to re-purchase due to favorable brand impressions • How measured? • Brand Equity • Definition: The positive effect that knowing the brand name has on consumer response to the product. • Psychological Value • Financial Value • The Link between Brand Loyalty & Brand Equity

26. Brand Loyalty Measurement Methods • Repeat Purchases • Reported Loyalty • Price Sensitivity Analysis • Brand Set “Squares” Method • Other Methods

27. Measuring Brand Equity Brand Audits Brand Tracking Brand Valuation

28. The 10 Most Valuable Brands

29. Brand earnings Brand sales Costs of sales Marketing costs Overhead expenses Remuneration of capital charge Taxation Brand strength Leadership (25%) Stability (15%) Market (10%) Geographic spread (25%) Trend (10%) Support (10%) Protection (5%) Interbrand’s Brand Equity Formula

30. Brand Equity Models • Brand Asset Valuator • Aaker Model • BRANDZ

31. Brand Asset Valuator (BAV) Brand Equity Factors Differentiation Knowledge Relevance Esteem

32. Aaker Model – Brand Identity Brand-as-product Brand-as-organization Brand-as-person Brand-as-symbol

33. Aaker Model – Brand Assets Brand loyalty Brand associations Brand awareness Proprietary assets Perceived quality

34. The BRANDZ Model Bonding Advantage Performance Relevance Presence

35. Major Brand Strategy Decisions

36. Brand Elements Brand Names URLs Slogans Elements Logos Characters Symbols

37. Like a good neighbor, State Farm is there Just do it Nothing runs like a Deere Help is just around the corner Save 15% or more in 15 minutes or less We try harder We’ll pick you up Nextel – Done Zoom Zoom I’m lovin’ it Innovation at work This Bud’s for you Always low prices Slogans

38. Memorable Meaningful Likeable Transferable Adaptable Protectible Brand Element Choice Criteria

39. Brand Positioning • Brands can be positioned at three levels: • Product features/ attributes • Least desirable • Easily copied • Brand benefits • Beliefs and values • Hits consumers on a deeper level, tapping “universal” emotions.

40. Brand Name Selection • Good Brand Names: • Straightforwardly suggest the product’s benefits and qualities. • Are easy to spell, pronounce and recognize. • Are distinctive and memorable. • Are extendable into different product lines (i.e. facilitate brand extensions). • Translate easily into foreign languages. • Provide the maximum legal protection from infringement.

41. Brand Name Selection Boudreaux’s Butt Paste is a real product used in the treatment of diaper rash. Is this a good brand name? • Good Brand Names: • Straightforwardly suggest the product’s benefits and qualities. • Are easy to spell, pronounce, recognize, and remember. • Are distinctive and memorable. • Are extendable into different product lines (i.e. facilitate brand extensions). • Translate easily into foreign languages. • Provide the maximum legal protection from infringement.

42. Brand Naming – Multi-brand strategies Individual names/ “House of Brands” Blanket family names/ ”Branded House” Parent/Sub-Brand combination names

43. Crest Whitestrips

44. Brand Sponsorship • Manufacturer’s brands • Also called “National Brands” (Tide, Coke, Pringles, etc.) • Private-label brands • Also called “Store” or “Distributor” Brands (Stop & Shop’s “Mi Casa”, Costco’s “Kirkland”) • Store vs. Private Label Trends • Co-branding – “Tag-team Branding” (Waffle House and Minute Maid OJ) • Ingredient Branding (“Intel Inside”) Mi Casa brand products are only available at Stop & Shop stores.

45. Brand Development Strategies

46. Line Extensions

47. Brand Extensions

48. Brand Development – Multibranding & New Brands • Multi-branding • appeal to different buying motives and segments • “branded variants” • Cannibalization issues • Example: Toyota sells Corolla, Camry, Scion, Yarris • New Brands • waning power of existing brands or product portfolio • diversification advantages • can develop (Black & Decker develops De Walt) or buy (i.e. Wendy’s buys Baja Fresh)

49. Brand line Brand mix Brand extension Sub-brand Parent brand Family brand Line extension Category extension Branded variants Licensed product Brand dilution Brand portfolio Branding Terms

50. Services