7. Product, Services, and Branding Strategy. ROAD MAP: Previewing the Concepts. Define product and the major classifications of products and services. Describe the roles of product and service branding, packaging, labeling, and product support services.
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7 Product, Services, and Branding Strategy
ROAD MAP: Previewing the Concepts • Define product and the major classifications of products and services. • Describe the roles of product and service branding, packaging, labeling, and product support services. • Explain the decisions companies make when developing product lines and mixes. • Identify the four characteristics that affect the marketing of a service. • Discuss the additional marketing considerations that services require.
What is a Product? • Anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need. • Includes: physical objects, services, events, persons, places, organizations, ideas, or some combination thereof.
What is a Service? • A form of product that consists of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. • Examples: banking, hotel, airline, retail, tax preparation, home repairs.
The Product-Service Continuum College Education Restaurant Sugar Pure Tangible Good Pure Service
Krispy Kreme A Krispy Kreme isn’t just a doughnut. It’s a truly sweet experience.
Consumer Products • Products and services bought by final consumers for personal consumption.
Convenience Products • Purchased frequently and immediately • Low priced • Mass advertising • Many purchase locations • Examples: candy, soda, newspapers
Shopping Products • Bought less frequently • Higher price • Fewer purchase locations • Comparison shop • Examples: furniture, clothing, cars, appliances
Specialty Products • Special purchase efforts • High price • Unique characteristics • Brand identification • Few purchase locations • Examples: Lamborghini, Rolex Watch
Unsought Products • New innovations • Products consumers do not want to think about • Require much advertising and personal selling • Examples: life insurance, cemetery plots, blood donation
Industrial Products • Those purchased for further processing or for use in conducting business.
Industrial Products Materials and Parts Raw materials, manufactured materials, and parts Capital Items Products that aid in buyer’s production or operations Supplies and Services Operating supplies, repair, and maintenance items
Other Market Offerings • Organizations: Profit (businesses) and nonprofit (schools and churches). • Persons: Politicians, entertainers, sports figures, doctors, and lawyers. • Places: create, maintain, or change attitudes or behavior toward particular places (e.g., tourism). • Ideas (social marketing): Public health campaigns, environmental campaigns, family planning, or human rights.
Organization Marketing Companies use corporate image advertising to market themselves to various publics. General Electric Stands for “imagination at work.”
Quality Performance and Satisfaction Includes Level & Consistency Features Differentiates a product from the competition; assessed based on value and cost Style & Design Style = Appearance Design = heart of the product Product and Service Attributes
Product Design The innovative Discover 2GO card is a gotta-have-it accessory for people who want to dash off to the gym, the mall, or a restaurant with nothing more than their keys and a credit card.
Branding • Creating, maintaining, protecting, and enhancing products and services. • A 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.
Branding • Advantages to buyers: • Product identification • Product quality • Advantages to sellers: • Basis for product’s quality story • Provides legal protection • Helps to segment markets
Packaging • Designing and producing the container or wrapper for a product. • Developing a good package: • Packaging concept • Package elements • Product safety • Environmental concerns
Innovative Packaging Dutch Boy recently came up with a long overdue innovation—paint in plastic containers with twist-off caps.
Labeling • Printed information appearing on or with the package. • Performs several functions: • Identifies product or brand • Describes several things about the product • Promotes the product through attractive graphics
Innovative Labeling Innovative labeling can help to promote a product.
Product Support Services • Assess the value of current services and obtain ideas for new services. • Assess the cost of providing the services. • Put together a package of services that delights the customers and yields profits for the company.
Filling Lengthen within current range Product Line Decisions Product Line Length Number of Items in the Product Line Stretching Lengthen beyond current range. Can be: Downward Upward Both Directions
Two-Way Stretch Marriott added the Renaissance Hotels line to serve the upper end of the market and the TownePlace Suites line to serve the moderate and lower ends.
Line Extension As Marriott’s product extension grew in popularity, it extended the product further. Click the picture above to play video
Product Mix Decisions • Product Mix: all of the product lines and items that a particular seller offers for sale. • Width: the number of different product lines the company carries. • Depth: the number of versions offered of each product in the line. • Consistency: how closely related the various lines are.
Brand Equity • The positive differential effect that knowing the brand name has on customer response to the product or service. • Provides: • More brand awareness and loyalty • Basis for strong, profitable customer relationships
Brand Positioning • Can position brands at any of three levels. Product Attributes Product Benefits Beliefs and Values
Brand Name Selection • Desirable qualities for a brand name include: • It should suggest product’s benefits and qualities • It should be easy to pronounce, recognize, and remember • It should be distinctive • It should be extendable • It should translate easily into foreign languages • It should be capable of registration and legal protection
Brand Sponsorship Manufacturer’s Brands Four Options Co-Branding Private Brands Licensed Brands
Line Extensions Morton sells an entire line of salts and seasonings for every occasion.
Brand Development • Line Extension: introduction of additional items in a given product category under the same brand name (e.g., new flavors, forms, colors, ingredients, or package sizes). • Brand Extension: using a successful brand name to launch a new or modified product in a new category.
Interactive Student Assignment • Choose a partner and go to the following website: Tide Products • Look at the various line extensions (e.g., liquid, powder, etc.) and determine why they were developed.
Brand Development • Multibranding: offers a way to establish different features and appeal to different buying motives. • New Brands: developed based on belief that the power of its existing brand is waning and a new brand name is needed. Also used for products in new product category.
Discussion Question • How can an airline deal with the intangibility, inseparability, variability, and perishability of its service offering?
Major Service Marketing Tasks • Managing Service Differentiation: • Develop a differentiated offer, delivery, and image. • Managing Service Quality: • Be customer obsessed, set high service quality standards, have good service recovery, empower front-line employees. • Managing Service Productivity: • Train current employees or hire new ones, increase quantity and sacrifice quality, harness technology.
Decide Which Products & Services to Introduce Decide How Much to Standardize or Adapt International Product and Services Marketing Packaging Presents New Challenges Service Marketers Face Special Challenges Trend Toward Global Service Companies Will Continue
Rest Stop: Reviewing the Concepts • Define product and the major classifications of products and services. • Describe the decisions companies make regarding their individual products and services, product lines, and product mixes. • Discuss branding strategy—the decisions companies make in building and managing their brands.
Rest Stop: Reviewing the Concepts • Identify the four characteristics that affect the marketing of a service and the additional marketing considerations that services require. • Discuss two additional product issues: socially responsible product decisions and international product and services marketing.