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MKTG. Lamb, Hair, McDaniel 2007-2008. 9. CHAPTER. Product Concepts. Designed by Amy McGuire, B-books, Ltd. Prepared by Deborah Baker, Texas Christian University. Learning Outcomes. Define the term product Classify consumer products

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MKTG

Lamb, Hair, McDaniel 2007-2008

9

CHAPTER

Product Concepts

Designed by

Amy McGuire, B-books, Ltd.

Prepared by

Deborah Baker, Texas Christian University


Learning outcomes
Learning Outcomes

Define the term product

Classify consumer products

Define the terms product item, product line, and product mix

Describe marketing uses of branding

LO1

LO2

LO3

LO4


Learning outcomes1
Learning Outcomes

Describe marketing uses of

packaging and labeling

Discuss global issues in branding and packaging

Describe how and why product warranties

are important marketing tools

LO5

LO6

LO7


What is a product
What Is a Product?

LO1

Define the term product


What is a product1

Everything, both favorable and unfavorable, that a person receives in an exchange.

  • Tangible Good

  • Service

  • Idea

What Is a Product?

Product

LO1


What is a product2

Product receives in an exchange.

Price

Promotion

Place (Distribution)

What Is a Product?

Product is the starting point of Marketing Mix

LO1


Review learning outcome

Product receives in an exchange.

Good

Service

Idea

REVIEW LEARNING OUTCOME

LO1

Define the term product


Types of consumer products
Types of Consumer Products receives in an exchange.

LO2

Classify consumer products


Types of products

Business receives in an exchange.

Product

A product used to manufacture other goods or services, to facilitate an organization’s operations, or to resell to other consumers.

Consumer

Product

A product bought to satisfy an

individual’s personal needs or wants

Types of Products

LO2


Types of consumer products1

Products receives in an exchange.

Consumer

Products

Business

Products

Convenience

Products

Shopping

Products

Specialty

Products

Unsought

Products

Types of Consumer Products

LO2


Types of consumer products2

Increase market share among receives in an exchange.

existing customers

Convenience

Product

A relatively inexpensive item that merits little shopping effort

Shopping

Product

A product that requires comparison shopping, because it is usually more expensive and found in fewer stores

Attract new customers to

existing products

Specialty

Product

A particular item for which consumers search extensively and are reluctant to accept substitutes

Create new products for

present markets

Market

Development

Diversification

A product unknown to the potential buyer or a known product that the buyer does not actively seek

Unsought

Product

Introduce new products

into new markets

Types of Consumer Products

LO2


Review learning outcome1
REVIEW LEARNING OUTCOME receives in an exchange.

LO2

Consumer Products


Product items lines and mixes
Product Items, Lines, and Mixes receives in an exchange.

LO3

Define the terms product item, product line,

and product mix


Product items lines and mixes1
Product Items, Lines, and Mixes receives in an exchange.

Product Item

A specific version of a product that can be designated as a distinct offering among an organization’s products.

Product Line

A group of closely-related product items.

Product Mix

All products that an organization sells.

LO3


Campbell s product lines and mix
Campbell’s Product Lines and Mix receives in an exchange.

LO3

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Benefits of product lines
Benefits of Product Lines receives in an exchange.

Advertising Economies

Package Uniformity

Standardized

Components

Efficient Sales andDistribution

Equivalent Quality

LO3


Product mix width
Product Mix Width receives in an exchange.

LO3

Product MixWidth

  • The number of product lines an organization offers.

  • Diversifies risk

  • Capitalizes on established reputations


Product line depth
Product Line Depth receives in an exchange.

LO3

Product Line

Depth

  • The number of product

  • Items in a product line.

  • Attracts buyers with different preferences

  • Increases sales/profits by further market segmentation

  • Capitalizes on economies of scale

  • Evens out seasonal sales patterns


Adjustments
Adjustments receives in an exchange.

Adjustments to Product Items,Lines, and Mixes

Product Modification

ProductRepositioning

Product Line

Extension or Contraction

LO3


Types of product modifications
Types of Product Modifications receives in an exchange.

LO3

Quality Modification

Functional Modification

Style Modification


Planned obsolescence
Planned Obsolescence receives in an exchange.

PlannedObsolescence

The practice of modifying products so those that have already been sold become obsolete before they actually need replacement.

LO3


Repositioning
Repositioning receives in an exchange.

Why reposition established brands?

Changing Demographics

Declining Sales

Changes in Social Environment

LO3


Product line extension
Product Line Extension receives in an exchange.

Product Line Extension

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

LO3


Product line contraction
Product Line Contraction receives in an exchange.

Symptoms of Product Line Overextension

  • Some products have low sales or cannibalize sales of other items

  • Resources are disproportionately allocated to slow-moving products

  • Items have become obsolete because of new product entries

LO3


Review learning outcome2
REVIEW LEARNING OUTCOME receives in an exchange.

LO3

Product item, product line, and product mix


Branding
Branding receives in an exchange.

LO4

Describe marketing uses of branding


Brand
Brand receives in an exchange.

Brand

A name, term, symbol, design, or combination thereof that identifies a seller’s products and differentiates them from competitors’ products.

LO4


Branding1

Brand receives in an exchange.

Name

That part of a brand that can be spoken, including letters, words, and numbers

Brand

Mark

The elements of a brand that

cannot be spoken

Brand

Equity

The value of company and brand names

GlobalBrand

A brand where at least 20 percent of theproduct is sold outside its home country

Branding

LO4


Benefits of branding

Product Identification receives in an exchange.

Repeat Sales

New Product Sales

Benefits of Branding

LO4


Biz Flix receives in an exchange.

Josie and the Pussycats

LO4


Top five global and north american brands

Global receives in an exchange.

North American

1. Apple

1. Apple

2. Google

2. Google

3. IKEA

3. Target

4. Starbucks

4. Starbucks

5. Al Jazeera

5. Pixar

Top Five Global and North American Brands

LO4

SOURCE: Deborah L. Vence, “Not Taking Care of Business,” Marketing News, March 15, 2005, p. 19.


Branding strategies

Brand receives in an exchange.

No Brand

Manufacturer’s Brand

Private Brand

IndividualBrand

Family Brand

Combi-nation

IndividualBrand

Family Brand

Combi-nation

Branding Strategies

LO4


Generic brand
Generic Brand receives in an exchange.

Generic

Product

A no-frills, no-brand-name, low-cost product that is simply identified by its product category.

LO4


Manufacturers brands versus private brands
Manufacturers’ Brands Versus receives in an exchange.Private Brands

Manufacturers’

Brand

The brand name of a manufacturer.

Private

Brand

A brand name owned by a wholesaler or a retailer. Also known as a private label or store brand.

LO4


Advantages of manufacturers brands
Advantages of receives in an exchange.Manufacturers’ Brands

  • Heavy consumer ads by manufacturers

  • Attract new customers

  • Enhance dealer’s prestige

  • Rapid delivery, carry less inventory

  • If dealer carries poor quality brand, customer may simply switch brands and remain loyal to dealer

LO4


Advantages of private brands
Advantages of receives in an exchange.Private Brands

  • Earn higher profits on own brand

  • Less pressure to mark down price

  • Manufacturer can become a direct competitor or drop a brand/reseller

  • Ties customer to wholesaler or retailer

  • Wholesalers and retailers have no control over the intensity of distribution of manufacturers’ brands

LO4


Individual brands versus family brands
Individual Brands Versus receives in an exchange.Family Brands

Individual

Brand

Using different brand names for different products.

Marketing several different

products under the same

brand name.

Family

Brand

LO4


Cobranding

Ingredient receives in an exchange.Branding

Types of Cobranding

Cooperative Branding

Complementary Branding

http://www.bose.com

Online

Cobranding

LO4


Trademarks

A Trademark is the exclusive right to use a brand. receives in an exchange.

Trademarks

  • Many parts of a brand and associated symbols qualify for trademark protection.

  • Trademark right comes from use rather than registration.

  • The mark has to be continuously protected.

  • Rights continue for as long as the mark is used.

  • Trademark law applies to the online world.

TM

LO4


Review learning outcome3
REVIEW LEARNING OUTCOME receives in an exchange.

LO4

Marketing Uses of Branding


Packaging
Packaging receives in an exchange.

LO5

Describe marketing uses of packaging and labeling


Functions of packaging

Contain and Protect receives in an exchange.

Promote

Facilitate Storage, Use,

and Convenience

Facilitate Recycling

http://www.levesquedesign.com/

http://www.design4packaging.com

Online

Functions of Packaging

LO5


Labeling

Persuasive receives in an exchange.

Informational

  • Focuses on promotional theme

  • Consumer information is secondary

  • Helps make proper selections

  • Lowers cognitive dissonance

  • Includes use/care

http://www.fda.gov

Online

Labeling

LO5


Universal product codes

Universal receives in an exchange.Product Codes (UPCs)

A series of thick and thin vertical lines (bar codes), readable by computerized optical scanners, that represent numbers used to track products.

Universal Product Codes

LO5


Review learning outcome4
REVIEW LEARNING OUTCOME receives in an exchange.

LO5

Packaging and Labeling


Global issues in branding and packaging
Global Issues in receives in an exchange.Branding and Packaging

LO6

Discuss global

issues in branding and packaging


Global issues in branding
Global Issues in Branding receives in an exchange.

One Brand NameEverywhere

Global Options for Branding

Adaptations & Modifications

Different Brand Names in Different Markets

LO6


Global issues in packaging
Global Issues in Packaging receives in an exchange.

Labeling

Global Considerations for Packaging

Aesthetics

Climate Considerations

LO6


Review learning outcome5

Branding Choices: receives in an exchange.

1 name

Modify or adapt 1 name

Different names in different markets

Packaging Considerations:

Labeling

Aesthetics

Climate

REVIEW LEARNING OUTCOME

LO6

Global Issues in Branding and Packaging


Product warranties
Product Warranties receives in an exchange.

LO7

Describe how

and why product warranties are important

marketing tools


Warranty receives in an exchange.

A confirmation of the quality or performance of a good or service.

Express

Warranty

A written guarantee.

Implied Warranty

An unwritten guarantee that the

good or service is fit for the purpose for which it was sold. (UCC)

Product Warranties

LO7


Review learning outcome6
REVIEW receives in an exchange. LEARNING OUTCOME

LO7

Product Warranties

Express warranty = written guarantee

Implied warranty = unwritten guarantee


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