Setting Product and Brand Strategy (Chapter 11). Consumer Goods Classification 1. Convenience goods : purchased , immediately, minimum of effort Price - ____________ Implications: readily available, many outlets, brand name, packaging, mass advertising. Consumer Goods Classification.
Consumer Goods Classification
1. Convenience goods: purchased , immediately, minimum of effort
Price - ____________
Implications: readily available, many outlets, brand name, packaging, mass advertising
2. Shopping goods: comparison shopping for suitability, quality, price, and style
Implications: brand; type of retailer ___________
3. Specialty goods: unique characteristics or brand identification; special purchasing effort; frequency of purchase is low
Implications: brand; type of retailer (store name)
4. Unsought goods: consumers _________ or do not normally think of buying
Implications: advertising; _________________
Procter & Gamble's Product Mix
Fabric & Home
Should product line be extended, maintained, or reduced? Why?
Should new product lines be added to the mix? Should existing lines be deleted?
Organizational objectives: ____________________ etc.
Projections/trends – external environment
Lengthen/shorten product line (vary products within a given line)
Lengthening product lines could mean higher market share and market growth (customer satisfaction)
But, longer lines result in : design, engineering, inventory carrying, new promotion, etc.
1. Growth strategies: line stretching
downmarket stretch: enter low end of the market (Sony Value Line)
upmarket stretch: enter high-end (Toyota-Lexus; Honda-Acura)
two-way stretch: both directions (Marriott:
2. Line modernization:improvements to encourage customer to higher valued, higher priced items
3. Pruning: product from the line
Product is not selling
Limited production capacity
Adding product lines (expanding width)
1. Response to ________________
2. Increase growth/profits AND ___________
3. Economical use of resources: Spread operational costs over a series of products; reduce average production and marketing costs
Deleting product lines
Brand: one of the most fundamental pieces of information customers use to simplify choices and reduce purchase risk.
name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers to differentiate them from those of competitors
Brand Equity: marketplace value of a brand based on reputation and goodwill
- company attaches corporate name to a product either to enter a new market segment or a different product class
New MultibrandsNew brands
Line extension – company introduces additional items in a given product category under the same brand name (existing brand name; existing product category)
New flavors, forms, colors, ingredients, package sizes
Brand extension – successful brand name is used to launch new or modified products in a new product class (new product category; existing brand name)
Honda: snowblowers, lawnmowers
Mattel: Barbie Doll brand –
Multibrands: establish different features and appeal to different buying motives (existing product category; new brand name)
NewBrands: create a new name in a new product (new product category; new brand name)
Dual branding (co-branding) - integrating two or more branded products
VISA & American Airlines
Pillsbury Cookie Dough & Nestle Chocolate