Chapter 10

1. Chapter 10 Product Concepts

2. What’s a Product? • Good • Service • Idea Experience Credence

3. Product Product is the “heart” ofMarketing Mix Promotion Price Place (Distribution) What Is a Product? 1

4. Product-Service Continuum Airline trip with snacks Auto with repair services Restaurant Doctor’s exam Soap

5. Product is a bundle of benefits 3. Augmented Product Additional services & benefits (unexpected) Installation Packaging Style Brand name Delivery & credit After- sale service Core good or service Design 1. Core product What the consumer is really buying Warranty 2. Actual Product

6. Types of Products: Consumer, Business • Consumer products • Determined by how consumers behave when buying an item: • 1. Convenience • 2. Shopping • 3. Specialty • 4. Unsought

7. Consumer Products • Convenience –frequently purchased • Grocery products • Staples • Emergency items

8. Consumer Products • Shopping (less frequent) • Homogeneous vs. Heterogeneous • What are the implications of marketing each of these two types?

9. Consumer Products • Specialty – special purchase effort • Principle of scarcity / uniqueness

10. Consumer Products • Unsought

11. Product Line & Product Mix terms • Product Item • Product Line • Product Mix • Width • Depth Product mix is also known as product assortment

12. Product Item- specific version of a product , a specific offering

13. Product Line- closely related items viewed as a unit • LAMPS: • Table • Ceiling • Track • Desk

14. Advertising Economies Package Uniformity Standardized Components Efficient Sales andDistribution Equivalent Quality Benefits of Product Lines

15. Product Mix-total group of products Product Line 1 Product Line 2 Product Line 3 • TABLES: • Kitchen • Dining Room • End • Coffee • Outdoor • Conference • Computer • CHAIRS: • Dining Room • Living Room • Bed Room • Outdoor • Desk • LAMPS: • Table • Ceiling • Track • Desk

16. Product Assortment and Product Line Decisions

17. Product Width-number of lines Product Line 1 Product Line 2 Product Line 3 • TABLES: • Kitchen • Dining Room • End • Coffee • Outdoor • Conference • Computer • CHAIRS: • Dining Room • Living Room • Bed Room • Outdoor • Desk • LAMPS: • Table • Ceiling • Track • Desk • Diversifies risk; Capitalizes on established reputations

18. Product Depth-number of different products in line Product Line 1 Product Line 2 Product Line 3 • TABLES: • Kitchen • Dining Room • End • Coffee • Outdoor • Conference • Computer • CHAIRS: • Dining Room • Living Room • Bed Room • Outdoor • Desk • LAMPS: • Table • Ceiling • Track • Desk Attracts buyers with different preferences; market segmentation

19. Campbell’s Product Lines and Mix

20. Adjustments Product Modification ProductRepositioning Product Line Extension or Contraction Adjustments to Product Lines, Items and Mixes Product Modification-changes in quality, function, style

21. Modification: Planned Obsolescence The practice of modifying products so those that have already been sold become obsolete before they actually need replacement. Floppy disk/cd-rom/FLASH DVD/VHS 18 mths life of ‘click wheel ipod’ HD-DVD/Blue Ray

22. Product Line Extension Adding additional products to an existing product line in order to compete more broadly in the industry.

23. LINE EXTENSIONS

24. WHAT AM I? Brand • Name, term, sign, symbol, design, or some combination that identifies the products of a firm. • Brand name - part of a brand that can be spoken (examples of brands with no names?) • Brand mark - symbolic

25. WHAT AM I? Branding Terms • Trademark – legal designation of the exclusive use of brand • Trade Name – Commercial, legal name

26. Value of Branding • To Buyers • Quality assurance • Rewards / Risks • To Sellers • Loyalty • Price premiums • Resistance to competition

27. Brand Equity • The value of the brand name!

28. Brand Equity: Can it be measured? • • Price premiums • Which would you prefer?: _X_Bayer for $3.75 ___Generic at $3.75 _X_Bayer for $3.75 ___Generic at $3.50 _X_Bayer for $3.75 ___Generic at $3.25 ___ Bayer for $3.75 _X_Generic at $3.00 ___ Bayer for $3.75 _X_Generic at $2.75 • • Preference Which box of cornflakes would you prefer? Brand X Brand Y [47%] [53%] Kelloggs Brand Y [59%] [41%]

29. Types of Brands • Manufacturer Brands • Private OR Retailer OR Store OR Reseller Brands • Generic Brands Battle of the Brands Pros/Cons?

30. “Genericide” • Aspirin • Cellophane • Corn flakes • Granola • Kerosene • Linoleum • Raisin bran • Shredded wheat • Thermos • Zipper

31. Individual Brands Versus Family Brands Individual Brand Using different brand names for different products from the same company Family Brand Marketing several different products under the same brand name.

32. IngredientBranding Types of Cobranding Cooperative Branding Complementary Branding Cobranding

34. BRAND EXTENSIONS

35. Successful Brand Extensions Kodak film – Kodak cameras and batteries Ivory soap – Ivory shampoo, dishwashing liquid Barbie dolls – Barbie games, furniture, clothes Honda bikes – Honda cars, lawnmowers, generators

36. Unsuccessful Brand Extensions Dunkin’ Donuts – Dunkin’ Donuts cereal Harley Davidson Bikes – Harley Davidson cigarettes Levis Jeans – Levis business wear Mr. Coffee coffee makers – Mr. Coffee coffee

37. Packaging • Packaging Functions • Protect and Maintain Functional Form • Offer Convenience • Marketing UPC

39. Labeling • Helps make proper selections • Lowers cognitive dissonance • Includes use/care Persuasive Informational • Focuses on promotional theme • Consumer information is secondary

42. Warranty A confirmation of the quality or performance of a good or service. Express Warranty A written guarantee. Implied Warranty An unwritten guarantee Product Warranties