Products and Brands

1. Products & Brands

2. What is a product?
 Anything that can be offered to a market
for attention, acquisition, use, or
consumption that might satisfy a want or
need.
 Include physical objects, services,
events, persons, places, organizations,
ideas, or mixes of these entities. iPod,
Camry, BigMac. Doctor’s advice, vacation
service, financial services.
 Service is any activity or benefit that one
party can offer to another that is
essentially intangible and does not result
in the ownership of anything.

3. Levels of Product and
Services
 3 levels: each level adds to customer
value
 The core benefit. E.g. Blackberry
 Actual product: features, design, quality
level, a brand image, and packaging. E.g.
Blackberry: actual product, its name,
parts, styling, features, and packaging.
 Augmented product. Offer consumer
services and benefits. (warranty,
instructions, quick repair and
maintenance when needed)

4. Product and Service
Classification
 Consumer Product: product bought by
final consumer for personal consumption
 Include:
 Convenience product: that the customer
usually buys frequently, immediately, and
with a minimum comparison and buying
effort: soap, candy, newspaper, fastfood.
 Shopping product: that the customer
usually buy carefully on suitability,
quality, price, and style: furniture,
clothing, appliances, hotel, travel service.

5.  Specialty product: consumer product
with unique characteristics or brand
identification for which a significant
group of buyers is willing to make a
special purchase effort: Ferrari FXX,
Boss, BB, Disney.
 Unsought product: consumer product
that the consumer either does not
know about or knows about but does
not normally think of buying: life
insurance, blood donations, living
funeral service.

6. Industrial Product
 Product bought by individuals and
organizations for further processing or
for use in conducting a business.
 Materials and parts (wheat, cotton,
livestock, crude petroleum) (iron, cement,
wires, tires, motors)
 Capital items (buildings, generators,
trucks etc)
 Supplies and services (lubricants, coal,
paper, pencils, paints, brooms,
conservancy items

7. Product and Service Decision
Individual product
decisions
Product line decisions
Product mix decisions.

8. Individual Product Decisions
 Product attributes: benefits that a product will
offer.
 Quality: “freedom from defects” “characteristics
of a product or service that bear on its ability to
satisfy stated or implied customer needs”
 Siemens defines quality this way: “Quality is
when our customers come back and our
products don’t”
 Two dimensions: performance quality – Rolls
Royce, Rolex, Marriot Renaissance.
Conformance quality – consistence in delivering
a target level of performance: Chevrolet

9. Product features: are a competitive
tool for differentiating the
company’s product from
competitors’ product.
Product style and design: style is
appearance of product. Design
contributes to a product’s
usefulness as well as its looks.
“Swiffer Carpetflick”U Shaped lock
by Kryptonite.

10. Branding
 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.
 212 Men, Swatch etc
 Hardly anything goes unbranded
 Branding helps consumer identify
products that might benefit them. Say
something about quality and consistency.
 Building and managing brands are the
marketer’s most important tasks.

11. Packaging
 Involves designing and producing the container
or wrapper for a product.
 Cluttered shelves, attracting attention,
describing the product, to making the sale.
 300 items per minute. 60 % of all purchases are
made on impulse.
 Poorly designed packages can cost companies.
 Heinz bottle design.
 Chip Ahoy by Kraft Foods
 Juice packs
 Product safety
 Environmental concerns

12. Labeling
Labels: tags attached to
products. Identifies the product
or brand, Frooti stamped on
orange, zenith etc.
Who made it, where it was
made, when it was made, its
contents, how it is to be used,
how to use it safely.

13. Product Line Decisions
 Product line: a group of products that are
closely related because they function in a
similar manner, are sold to the same
customer groups, are marketed through
the same types of outlets, or fall within
given price range. E.g. Nike, Nestle
 Product line-length: the number of items
in the product line. BMW 3 series, 5, 7
series.
 Downward: DaimlerChrysler Mercedes C-
Class. Toyota, Nissan, Honda luxury cars.

14. Marriot Example
 Renaissance Hotels & Resorts: top
executives
 Marriot: upper and middle managers
 Courtyard: salespeople & road warriors
 Fairfield: vacationers and business
travelers on tight budgets.
 ExecuStay: temporary housing for 30
days
 Residence Inn: for people who travel for a
living

15. Product Mix Decisions
 The set of all product lines and items that a
particular seller offers for sale.
 Colgate: oral care, personal care, home care,
and pet nutrition.
 Four dimensions: width, length, depth, and
consistency.
 Width: number of different product lines.
 Length: the total number of items the company
carries within its product line. 3 M markets
60,000 products, Wal Mart stocks 100 -12000
items, GE manufactures 250,000 items.

16.  Depth: the number of versions offered of
each product in the line. Colgate
toothpastes 11 varieties: Colgate Total,
Colgate Tartar Control, Colgate 2 in 1,
Colgate Cavity Protection, Colgate
Sensitive, Colgate Fresh Confidence,
Colgate Max Fresh, Colgate Simply White,
Colgate Sparkling White, Colgate Kids
Toothpaste, Colgate Baking Soda.
 Consistency: refers to how closely related
the various product lines are in end use,
production requirements, distribution
channels.

17. Branding Strategy
 Major asset of a company.
 Are more than names and symbols. They
represent consumers’ perceptions and
feeling about a product and its
performance. Brands exist in the minds
of consumers.
 Real power: to capture consumer
preference and loyalty.
 Coca-Cola, Tide, Nike, Harley-Davidson,
Disney forge deep connections with
customers.

18.  Powerful brand has high brand equity.
 The positive differential effect that knowing
the brand name has on customer response
to the product or service.
 To what extent people are willing to pay
more for the brand.
 A brand with strong brand equity is a very
valuable asset. Brand valuation is the
process of estimating the total financial
value of a brand. Coca-Cola $67 billion,
Microsoft $ 57 billion, IBM $ 56 billion.
 Brand can: provide competitive advantage.
Brand awareness and loyalty. Bargaining
with resellers. Brand extensions launch.
Protection against fierce price competition.
Profitable customer relationship.

19. Branding Strategies
 Brand positioning:
 Position product in target
customers’ mind
 Product Attributes
 Desirable benefits – Volvo, FedEx,
Lexus, Nike
 Strong beliefs and values – strong
brands engage customers on a
deep, emotional level (empower
socially)

20.  Brand name selection:
 Good name can add to product success
 Should relate to product benefits and
qualities – Lexus, Jaguar, Swift, Off!,
Knorr, Haleeb, MilkPack
 Easy to pronounce: IBM, AT & T, Voda
fone, KFC, Burger King
 Distinct, Z-4, GTR, Oracle
 Brand name identified with product
category: Xerox, Kleenex, Scotch Tape,
Formica, Fiberglass

21. Brand Sponsorship
A product may be launched
as:
Manufacturer’s brand
Private brand
Licensed brand
Co-brand

22. Brand Development
 Line extensions: Extending an existing
brand name to new forms, colors, sizes,
ingredients, or flavor of an existing
product: Nestle Pure Life
 Coke: Diet Coke, Diet Coke with Splenda,
Coca Cola Zero
 Diet Cherry Coke, Diet Coke with Lemon,
Diet Coke with Lime, Diet Coke Black
Cherry Vanilla, Caffeine Free Diet Coke –
Coca Cola C – 2.

23. Brand Extensions
Extending an existing brand
name to a new product category
Kimberly – Clark – Huggies
Brand: Shampoos, Lotions,
Baby Wash
Brinks – Brinks Home Security
System

24. Multi Brands
New Brands
Additional Brands in the same
category
P& G: different features for
different buyers
Existing wane – new brands
needed
Matsushita – Panasonic,
Technics, JVC, Quasar

25. Product Life Cycle
Product launch – happy life
Cover costs
Earn profits
Length not know in advance
Coca-Cola, Gillette, Budweiser,
American Express, Wells-Fargo,
and Tabasco

26. PLC – S Curve

27. Introduction Stage
Product launch
Takes time
Slow growth
Negative profits
High promotion and
distribution cost

28. Growth Stage
 Product, if satisfies market, enters
growth stage
 Sales climb quickly
 Early adopters continue, new join
through favorable word of mouth
 New competitors enter market
 Competition – increase in sale points
 Spread of sales, unit cost reduces
 Sustain rapid growth
 New market segments
 Prices may be lowered to attract more
customers (iPod)

29. Maturity
 At some point sale slows down, product
enters maturity stage
 Lasts longer
 Marketing management most of the time
deals with mature products
 More producers selling the same product
 Greater competition
 Prices down, increase in sales promotion
 Drop in profit
 Well established competitors stay

30. Maturity
 Product manager should modify
market, product and marketing mix
 Market: increase consumption of
product, new users, present users
 Product: quality, features, style
(milk pak, Honda City)
 Four Ps

31. Decline Stage
 Eventually dip
 Oat meal, VHS tapes, VCR, Tape recorders
 Reasons: technology, consumer tastes,
increased competition, profits decline,
withdrawal from market
 Furthermore:
 Weak product costly to firm
 Management time
 Price adjustments
 Advertising/sales efforts
 Reputation of other co products affected
 Old Spice/ co can sell brands