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Chapter Eight. Product, Services, and Brands: Building Customer Value. What Is a Product?. Levels of Product and Services. Product and Service Decisions. Product attributes are the benefits of the product or service Quality Features Style and design.

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Chapter eight
Chapter Eight

Product, Services, and Brands: Building Customer Value


What is a product
What Is a Product?

Levels of Product and Services


Product and service decisions
Product and Service Decisions

Product attributes are the benefits of the product or service

Quality

Features

Style and design

Individual Product and Service Decisions


Product and service decisions1
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


Chapter ten eleven
Chapter Ten & Eleven

Pricing:

Understanding and Capturing Customer Value


Factors to consider when setting prices
Factors to Consider When Setting Prices

Customer Perceptions of Value


Factors to consider when setting prices1
Factors to Consider When Setting Prices

Customer Perceptions of Value


Factors to consider when setting prices2
Factors to Consider When Setting Prices

Good-value pricing offers the right combination of quality and good service to fair price

Existing brands are being redesigned to offer more quality for a given price or the same quality for less price

Customer Perceptions of Value


Factors to consider when setting prices3
Factors to Consider When Setting Prices

Company and Product Costs

Types of costs


Factors to consider when setting prices4
Factors to Consider When Setting Prices

Fixed costs are the costs that do not vary with production or sales level

Rent

Heat

Interest

Executive salaries

Company and Product Costs


Factors to consider when setting prices5
Factors to Consider When Setting Prices

Variable costs are the costs that vary with the level of production

Packaging

Raw materials

Company and Product Costs


Factors to consider when setting prices6
Factors to Consider When Setting Prices

Total costs are the sum of the fixed and variable costs for any given level of production

Average cost is the cost associated with a given level of output

Company and Product Costs


Pricing strategies
Pricing Strategies

Include any one or a few of the pricing strategies that you’ll be following:


New product pricing strategies
New-Product Pricing Strategies

Market-skimming pricing

Market- penetration pricing

Pricing Strategies


Product mix pricing strategies
Product Mix Pricing Strategies

Pricing Strategies



Chapter eight

  • Which tool would you use

  • Which media would you use

  • Why would you use these tools and media

  • How would you use these tools and media

IMC


The promotion mix
The Promotion Mix

Advertising is any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor

Broadcast

Print

Internet

Outdoor

Major Promotion Tools


Key characteristics of tools
Key Characteristics of Tools

ADVERTISING

  • Non-personal mass communication

  • High reach

  • Impact

  • High cost

  • Low credibility?

  • Difficult to measure


The promotion mix1
The Promotion Mix

Sales promotion is the short-term incentives to encourage the purchase or sale of a product or service

Discounts

Coupons

Displays

Demonstrations

Major Promotion Tools


Key characteristics of tools1
Key Characteristics of Tools

SALES PROMOTION

  • Used tactically in short term

  • Aim is often to increase sales

  • High control and measurement

  • Moderate cost

  • Can be used throughout distribution channel

  • Credibility may be questioned


The promotion mix2
The Promotion Mix

Public relations involves building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events

Press releases

Sponsorships

Special events

Web pages

Major Promotion Tools


Key characteristics of tools2
Key Characteristics of Tools

PUBLIC RELATIONS

  • Non-personal

  • Wide range of tools available

  • High credibility

  • Low cost


The promotion mix3
The Promotion Mix

Personal selling is the personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships

Sales presentations

Trade shows

Incentive programs

Major Promotion Tools


Key characteristics of tools3
Key Characteristics of Tools

PERSONAL SELLING

  • Interpersonal communications tool (two way)

  • Instantaneous feedback possible

  • Message can be tailored

  • High cost

  • More suitable where message is complex


The promotion mix4
The Promotion Mix

Direct marketing involves making direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships—through the use of direct mail, telephone, direct-response television, e-mail, and the Internet to communicate directly with specific consumers

Catalog

Telemarketing

Kiosks

Major Promotion Tools


Key characteristics of tools4
Key Characteristics of Tools

DIRECT MARKETING

  • Any form of direct response communications

  • Targets individual customers (database)

  • Can deliver personalised message

  • Builds relationships

  • Facilitated by technological developments

  • Moderate absolute cost but cost per contact high



New tools new media
New Tools, New Media

Broadcast advertising (TV/radio)

Print advertising (newspaper/magazine)

Interactive/internet marketing

Website/on-line advertising

Outdoor/billboards

Mobile/Wap

Personal selling

Telemarketing

Packaging

Direct marketing

Publicity/PR

Point of purchase

Product placement

Sales promotion

Word of mouth

Events & sponsorship


Chapter twelve
Chapter Twelve

Marketing Channels: Delivering Customer Value


Supply chains and the value delivery network
Supply Chains and the Value Delivery Network

Upstream partners include raw material suppliers, components, parts, information, finances, and expertise to create a product or service

Downstream partners include the marketing channels or distribution channels that look toward the customer

Supply Chain Partners



Channel design decisions
Channel Design Decisions

Identifying Major Alternatives


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