product classification and branding
DESCRIPTION
TRANSCRIPT
UNIT II MARKETING MANAGEMENT
BY
IBADAT SINGH SETHI
HARVINDER SINGH
SAHIL SHARMA
PRODUCT
A product is anything that can be offered to a market to satisfy a want or need
Physical goods
Services
Experiences
Events
Persons
Places
Properties
Organizations
Information
Ideas
CUSTOMER VALUE HIERARCY
A product can also be defined as the end result of the manufacturing process, to be offered to the marketplace to satisfy a need or want.
CHARACTERISTICS OF PRODUCTS
Tangible in nature.
Products have a physical evidence
Products are something that are manufactured for its marketing and selling purposes.
Products can be physically shifted from one place to another place i.e. a product is something that a customer can buy and take with him.
CLASSIFICATION OF PRODUCTS
PRODUCT
CONSUMER PRODUCT
INDUSTRIAL PRODUCT
CONSUMER GOODS
CONVENIENCEPRODUCT
SHOPPING PRODUCT
SPECIALTY PRODUCT
INDUSTRIAL GOODS
MATERIAL AND PARTS
CAPITAL ITEMS
SUPPLIERS AND SERVICES
PRODUCT DIFFERENTIATION
FORM
PRODUCT DIFFERENTIATION
FEATURES
CUSTOMIZATION
PRODUCT DIFFERENTIATION
CONFORMANCE QUALITY
DURABILITY
PRODUCT DIFFERENTIATION
RELAIBILTY
REPAIRABILITY
STYLE
SERVICE DIFFERENTIATIONORDERING EASE
DELIVERY
INSTALLATION
CUSTOMER TRAINING
CUSTOMER CONSULTING
MAINTAINANCE & REPAIR
RETURNS
SERVICE DIFFERENTIATION
PRODUCT MIX
Product mix is defined as the total composite offered by a particular organization.
The product mix includes four elements
Width,
Length,
Depth,
Consistency
Width: The Width of the assortment refers to how many product lines the company markets i.e. the number of product line the company carries
Length: The Length signifies how many products a given line includes i.e. the total number of items the company carries within its product line.
Depth: The term Depth touches on how many versions of a given product line offers.
Consistency: Finally, Consistency denotes the uniformity relative to how products are used by consumers, or by how they are produced or distributed.
E.G. HINDUSTAN UNILEVER LTD. (HUL).
Product Mix Width:
Deo, Personal Wash, Laundry, Skin Care, Hair Care, Oral Care, Colour Cosmetics, Coffee, Foods.
Product line length:
Deo: Axe, Rexona
Personal wash: Lux, Lifebuoy, Liril, Hamam, Breeze, Dove, Pears, Rexona
Laundry: Surf Excel, Rim, Wheel
Skin care: Fair & Lovely, Ponds
Hair care: Sun Silk, Clinic
Oral care: Pepsodent
Colours cosmetic: Lakme
Coffee: Bru
Food: Kissan, Annpurna, Knors
PRODUCT LINE ANALYSIS
SALES & PROFITS
Core products
Staples
Specialties
Convenience items
MARKET EVOLUTION
PRODUCT LINE LENGHT
LINE STRETCHING
Down-Market Stretch
Up-Market Stretch
Two-Way Stretch
PRODUCT LINE LENGHT
LINE FILLING
LINE MODERNISATION, FEATURING & PRUNING
PRODUCT LINE ANALYSIS
Product line analysis applies established modeling techniques to engineer the requirements for a product line for software intensive system.
PRODUCT LINE LENGTH
Product line length may be defined as the number or variety of different products in a product line.
The length of a product line can be extended. Product line extension is a favorite method used by many manufacturers as a means of deepening brand loyalty and increasing revenue.
Product line extensions BMW 3 Series through 7 Series automobiles, with each series appealing to different types of clients.
Product line extensions may also be horizontal in which a product’s attributes, and not cost differentiators, changes the variety – such as Coke, Diet Coke, Cherry Coke, and Caffeine-free Coke .
PRODUCT LINE FILLING
A business strategy that involves increasing the number of products in an existing product line to take advantage of market place gaps and reduce competition. Many businesses use line filling to round out an already well established product line and to help increase the market success of new related products.
PACKAGING
NEED FOR PACKAGING
1. Self-Service
2. Consumer affluence
3. Company and brand image
4. Innovation opportunity
IMPORTANCE OF PACKAGING
1. To protect a product from damage or contamination by micro-organisms and air, moisture and toxins.
2. To keep the product together, to contain it (i.e. So that it does not spill).
3. To identify the product.
4. Protection during Transport and Ease of Transport.
5. Stacking and Storage.
6. Printed Information.
LABELING
The label may be a simple tag attached to the product or an elaborately designed graphic that is part of the package. It might carry only the brand name, or a great deal of information. Even if the seller prefers a simple label, the law may require more.
IMPORTANCE OF LABELING
Identifies the product or brand
Grade the product according to its quality
Describe the product
Promote the product through attractive graphics.
KEY CHARACTERISTICS OF GOOD PRODUCT LABELING
Provide basic information
Details of the contents or ingredients
Warnings and contra indication
Instructions for use
Visible & easy to read
HHA
NEW PRODUCT DEVELOPMENT
NEW PRODUCT………………………?
A new product is one which is really innovative, which is significantly different from existing and imitative products that are new to the company.
There are two ways to make new product viz.
a) modify the existing product.
b) formation of entire new product.
EXAMPLES……………………………………..
New product -modified existing
Maruti Suzuki Swift(diesel)
New product-entire new formation
LML Freedom(bike)
8 STAGES ARE THERE
Idea generation
Idea screening
Concept development and testing
Marketing strategy development
Business Analysis
Product development
Market testing
Commercialization
STAGE: 1
HOW TO GENERATE IDEA………?1.Interacting with others
STAGE 1 ……CONTD.
2. Creativity generation
a) Attribute listing
b) Forced relationships
c) Morphological analysis
d) Reverse assumptions
analysis
e) New contexts
f) Mind mapping
2. IDEA SCREENING
Must avoid two errors
1.Drop error-the idea is good but we reject it.
SCREENING………CONTD.
2. Go error-when company permits a poor idea
3.CONCEPT DEVELOPMENT & TESTING
Concept is devised on three basic questions:
1. Who will use the product?
2. What primary benefit should this product provide?
3. When will the people consume this product?
Example,a nutritive powder to add to milk…..
CONSUMERS DON’T BUY PRODUCT IDEAS, THEY BUY
PRODUCT CONCEPTS
Concept 1: An instant breakfast drink for adults who want a quick nutritious breakfast without preparation.
C-2: A tasty snack for children to drink as a midday refreshment.
C-3: A health supplement for older adult to drink in the late evenings before going to bed.
CONCEPT TESTINGMeans presenting the product concept, symbolically or physically to target consumers.
Type of information collected :
1. Communicability and believability.
2. Need level & Gap level
3. Perceived value & purchase intention.
4. User targets, purchase occasions & purchasing frequency.
4. MARKETING STRATEGY DEVELOPMENT
It’s a three part strategy…..
Ist part : target market, size & structure, market share and behavior.
2nd part : price & distribution strategy and marketing budget for first year.
3rd part : long run or futuristic marketing-mix strategy .
5. BUSINESS ANALYSIS
Sales, costs and profit projections are prepared to determine whether they satisfy company objectives.
6.PRODUCT DEVELOPMENT
Consists of two sub stages:
1. Physical prototypes
2. Consumer tests
a) Alpha testing-within the firm
b) Beta testing-outside the firm
7.MARKETING TESTING
The product is ready to be dressed up with a brand name and packaging and put into market .
Small quantity of product is introduced in market to know the performance of product.
8. COMMERCIALIZATION
Four words to keep in mind while commercialization viz.
1. When(timing)
2. Where(geographic strategy)
3. To whom(target market)
4. How(introductory market strategy)
CHALLENGES TO NEW PRODUCT DEVELOPMENT
Globalization
Time
Market potential
Technological change
Distribution
New features
Critical unmet needs
Market size
Price
Promotion
Resistance to change
Government policies
CHALLENGES TO NEW PRODUCT DEVELOPMENT
GLOBAL COMPETITION
MAHINDRA &
MAHINDRA
CHALLENGES TO NEW PRODUCT DEVELOPMENT
TIME
ZARA
CHALLENGES TO NEW PRODUCT DEVELOPMENT
MARKET POTENTIAL
FACEBOOK AND INSTRAGRAM
CHALLENGES TO NEW PRODUCT DEVELOPMENT
TECHNOLOGICAL CHANGE
APPLE
CHALLENGES TO NEW PRODUCT DEVELOPMENT
DISTRIBUTION
STARBUCKS
CHALLENGES TO NEW PRODUCT DEVELOPMENT
NEW FEATURES
CHALLENGES TO NEW PRODUCT DEVELOPMENT
CRITICAL UNMET NEEDS
EMAMI
FAIR & HANDSOME
CHALLENGES TO NEW PRODUCT DEVELOPMENT
MARKET SIZE
SEGWAY
CHALLENGES TO NEW PRODUCT DEVELOPMENT
PRICE
MICROMAX CANVAS
CHALLENGES TO NEW PRODUCT DEVELOPMENT
PROMOTION
RAONE
CHALLENGES TO NEW PRODUCT DEVELOPMENT
RESISTANCE TO CHANGE
COCA-COLA
CHALLENGES TO NEW PRODUCT DEVELOPMENT
Government Policies
New drug
CONSUMER ADAPTATION PROCESS
ORINNOVATION DIFFUSION
PROCESS
ADOPTION??????
Adoption is an individual’s decision to become a regular user of a product.
Consumer adoption process was first described by Bourne (1959).
It describes the behavior of consumers as they purchase new products and services.
ACCORDING TO EVERETT ROGERS:
INNOVATION DIFFUSION PROCESS IS DEFINED AS,“SPREAD OF A NEW IDEA FROM ITS SOURCE OF CREATION TO ITS ULTIMATE USERS”
STAGES INCONSUMER ADOPTION PROCESS
ADOPTION PROCESS
ADOPTION
TRIAL
EVALUATION
INTEREST
AWARENWSS
No way!
If I have to buy it I will.
OK, we will
buy X.
THE CONSUMER BECOMES AWARE OF THE INNOVATION BUT LACKS INFORMATION ABOUT IT.
THIS IS THE AREA WHERE MAJOR MARKETERS SPEND BILLIONS OF DOLLARS.
AWARENESS
(1) THE CONSUMER IS STIMULATED TO SEEK INFORMATION ABOUT THE INNOVATION.
(2) MARKETERS TRY TO ATTRACT CUSTOMERS BY ADDING EMOTIONAL FACTORS WITH THE ADS.
(3) HOWEVER, IF THE CONSUMER DOES NOT PERCEIVE THAT THE PRODUCT WILL SATISFY EXISTING WANTS OR NEEDS, HE OR SHE IS NOT LIKELY TO MOVE TO THE NEXT STAGE IN THE ADOPTION PROCESS.
INTEREST
EVALUATION
•CONSUMER CONSIDERS WHETHER TO TRY THE INNOVATION.
TRIAL• CONSUMER TRIES THE INNOVATION TO IMPROVE ESTIMATE OF PRODUCT VALUE.
• COMPANIES SELL PRODUCTS IN THE FORM OF SAMPLES TO ATTRACT CUSTOMERS.
•FMCG
THE CONSUMER DECIDES TO MAKE FULL AND REGULAR USE OF THE INNOVATION.
AT ANY POINT, THEY MAY BECOME DISSATISFIED WITH THE PRODUCT AND DISCONTINUE ITS USE.
ADOPTION
READINESS TO BUY PRODUCTS
IT IS THE DEGREE TO WHICH AN INDIVIDUAL IS RELATIVELY EARLIER IN ADOPTION OF NEW IDEAS.
CLOTHING FASHION
ADOPTER GROUPS
PERSONAL INFLUENCE
• EFFECT ONE PERSON HAS ON ANOTHER’S ATTITUDE.
• IT HAS HIGH INFLUENCE ON LATE ADOPTERS THAN EARLY ADOPTERS.
CHARACTERISTICS OF THE INNOVATION
RELATIVE ADVANTAGE
COMPATIBILITY
COMPLEXITY
DIVISIBILITY
COMMUNICABILITY
BRAND“A 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 and to differentiate them from those of competitors.”
PURPOSE OF A BRAND… Inspire
Motivate
Connect
Simplify
Inform
HOW DO YOU BRAND A PRODUCT?
Branding is the process by which companies distinguish their product offerings from the competition.
Branding protects a seller's products against those marketed by competitors and imitators and helps consumers identify the quality, consistency, and imagery of a preferred source.
BRANDING IS….
An image created in someone’s mind
It’s both tangible and intangible characteristics of a product or service that make it unique
It’s all about creating differences b/w products or services.
Marketing is actively promoting a product or service. It’s pushing out a message to get sales results. Branding, on the other hand is not push, but pull.
Branding is strategic. Marketing is tactical
BRANDING VS MARKETING
Marketing may contribute to a brand, but the brand is bigger than any particular marketing effort. It’s what sticks in your mind associated with a product
Marketing may convince you to buy a particular Maruti but it is the brand that will determine if you will only buy Maruti for the rest of your life.
BRANDING VS MARKETING
SCOPE OF BRANDING
GOODS
SERVICES
PLACES
PERSSON
ORGANIZATION
IDEA etc.
POSITIVES OF BRANDING…
Recognition And Loyalty
A strong brand name and logo/image helps to keep the company’s image in the mind of potential customers.
Image of Size
A strong brand will project an image of a large and established business to any potential customers.
Image of Quality
A strong brand projects an image of quality in your business, many people see the brand as a part of a product or service that helps to show its quality and value.
Image of Experience and Reliability
A strong brand creates an image of an established business that has been around for long enough to become well known.
POSITIVES OF BRANDING…
NEGATIVES OF BRANDING…
Cost
If you wish to create and maintain a strong brand presence, it can involve a lot of design and marketing costs.
Impersonal
One of the main problems with many branded businesses is that they lose their personal image.
Fixed Image
Every brand has a certain image to potential customers, and part of that image is about what products or services you sell.
Timescale
The process of creating a brand will usually take a long period of time.
NEGATIVES OF BRANDING…
BRAND EQUITY
Brand Equity is defined as the unique set of brand assets and liabilities that is linked to a brand. It is the net result of all the investment and effort that a marketer puts into building a brand.
What’s the first thing that comes to your mind when I say Coffee?
What do you think when you see this logo
High Brand Equity provides a number of competitive advantages:
The Company will enjoy reduced marketing costs because of consumer brand awareness and loyalty
The Company can charge a higher price than its competitors because the brand has higher perceived quality.
The Company will have more trade leverage in bargaining with distributors and retailers because customers expect them to carry the brand.
The Company can more easily launch extensions because the brand name carries high credibility.
The brand offers the Company some defense against price competition.
BUILDING BRAND EQUITY
BRAND ELEMENTS
Brand Elements are those trademarkable devices that serve to identify and differentiate the brand.
The main ones are brand names, URLs, logos, symbols, characters, spokespeople, slogans, jingles, packaging etc.
WHY BRAND ELEMENTS?
The customer based brand equity model suggests that marketers should choose brand elements
• To enhance brand awareness• Facilitate the formation of strong and unique brand
associations• Elicit positive brand feelings
BRAND ELEMENT CHOICE CRITERIA
MemorableMeaningfulLikable
TransferableAdaptableProtectable
Brand Builders
Defensive
CRITERIA FOR CHOOSING BRAND ELEMENTS
Offensive Strategies
• Memorable
• Easily Recognized• Easily Recalled
• Meaningful
• Descriptive• Persuasive
• Likable
• Rich visual/verbal imagery• Aesthetically Pleasing
CRITERIA FOR CHOOSING BRAND ELEMENTS
Defensive Strategies
• Transferable
• Within and across product categories• Across geographic boundaries
• Adaptable
• Flexible• Update-able
• Protectable
• Legally• Competitively
EXAMPLES OF MEANINGFULNESS
MEANINGFULNESS OF INTELThe word ‘Intel’ is a portmanteau of the words “intelligent” “electronics”.
The name suggests that it is an electronics company that delivers better, even “intelligent” products
PROTECTABILITY EXAMPLE
LOGOS AND SYMBOLS
Along with brand names, visual elements have a critical role in building brand equity, especially brand awareness
Logos have been used since the middle ages to denote names of Kings in the form of a Coat of Arms and Emblems
EXAMPLE OF LOGOS
CHARACTERS Characters are human or life-like brand symbols that take
the characteristics of the brand.
They are usually introduced through advertising campaigns
Brand characters play a central role in brand campaigns and package designs
Brand characters can also be negative in the sense that they dominate other brand elements and decrease brand awareness
EXAMPLES OF BRAND CHARACTERS
SLOGANS Slogans are short phrases that communicate descriptive
or persuasive information about the brand
They often appear in advertising
They function as “hooks” to help consumers understand the meaning of the brand
Eg: “Hungry Kya?” by Domino’s Pizza
Eg: “Isse sasta aur achcha kahin nahi” by Big Bazaar
BENEFITS OF SLOGANS Build both brand awareness and image
Strong links with the
The brand is exaggerated to leverage maximum brand equity. Eg: “It’s not TV, It’s HBO” by HBO; “The Citi Never Sleeps” by CitiBank
The brand is made an aspirational product – “Just Do It” by Nike
JINGLES Jingles are musical messages written around the brand
Usually composed by professional songwriters and musicians
Successful jingles are registered in the minds of the listeners
It was popular in the early 20th century when the primary broadcast medium was radio
Convey brand benefits and product meaning in a fairly abstract manner
IPL JINGLE
BRANDING ELEMENTS – A PICTORIAL OVERVIEW
Brand Names
URLs
Logos and
Symbols
Characters
Slogans
Packaging
Brand Identity
Brand Awareness
Brand Association
s
BRAND REINFORCEMENT
What products the Brand represent
Core benefits
How the brand makes the products superior, strong, favorable etc.
BRAND REVITALIZATION
REVITALIZING BRAND
HOLISTIC MARKETING ACTIVITIES
Word of Mouth
Observation
Interactions w/company
SECONDARY ASSOCIATIONS
Brand
Geographic Regions
Other Brands
Characters
Spokespeople
Sporting Events
BRANDING REVITALIZATION STRATEGY
Develop new brand elements
Apply existing brand elements
Combine new and existing elements
BRANDING STRATEGY
Identifies which brand elements a firm chooses to apply across the various products it sells.
BRANDING STRATEGY
When a firm introduces new product, three main choices it has:
Develop new brand elements for the new product.
Apply some of its existing brand elements.
Use combination of new and existing brand elements.
BRANDING STRATEGY DECISIONS
Whether to develop a brand name for a product.
If a firm decides to brand its products or services, it must then choose which brand name to use.
BRANDING STRATEGY DECISIONS
Four strategies often used:
1. Individual names.
2. Blanket family names.
3. Separate family names for all products.
4. Corporate name combined with individual product names.
INDIVIDUAL NAMESCompany does not tie its reputation to the product.
For example : HUL
BLANKET FAMILY NAMESSame name is used in diverse product categories.
Development costs are lower.
For example : TATA
SEPARATE FAMILY NAMES
Firms use separate family names for its various products..
For example : Aditya Birla Group
CORPORATE NAME COMBINED WITH INDIVIDUAL PRODUCT NAMES
Kellog combines corporate & individual names in Kellogg’s Rice Krispies, Kellogg’s Raisin Bran, Kellogg’s Corn Flakes.
J&J
BRANDING STRATEGY
Two key components of any branding strategy are:
Brand Extensions
Brand Portfolios
BRAND EXTENSION
Two general categories are:
1. Line Extension
2. Category Extension
LINE EXTENSIONThe parent brand covers a new product within a product category it currently serves, such as with new flavours, forms, ingredients and package sizes.
Examples: Dove, LUX
CATEGORY EXTENSIONA company may use its parent brand name to launch new products in other categories.
Example: Bajaj
ADVANTAGES OF BRAND EXTENSIONS
Facilitate new product acceptance.
Provide positive feedback to the parent brand company.
Reduce cost of the introductory launch campaign.
Avoid difficulty and expense of coming up with the new name.
DISADVANTAGES OF BRAND EXTENSIONS
May cause the brand name to be less strongly identified with any one product.
For example : Cadbury.
Brand dilution occurs i.e. consumer no longer associate a brand with a specific product and start thinking less of the brand.
Consumers become confused and perhaps frustrated.
BRAND PORTFOLIOS
Marketers often need multiple brands in order to target multiple segments
Reasons for introducing multiple brands:
Increasing shelf presence in the store.
Attracting consumers seeking variety who may otherwise have switched to another brand.
Yielding economies of scale.
BRAND PORTFOLIOSReduce consumer confusion.
For Example: PepsiCo.
BRAND POSITIONING
POSITIONING: Act of designing the company’s offering and image to occupy a distinctive place in the minds of the target market.
A good brand positioning guides marketing strategy by clarifying the brand essence.
Result of positioning – customer-focused value proposition.
BRAND POSITIONING
Place in the customer’s mind that you want your brand to own.
Deciding on positioning requires :
determining frame of reference by identifying the target market and the competition.
Identifying and establishing points-of-parity and points-of-difference to establish right brand identity and brand image.
EGS. OF BRAND POSITIONING
Based on low price.
FRAME OF REFERNCE (FOR)
Concerns with category membership of the product or which product category it competes with.
To determine competitive frame of reference, marketers need to understand consumer behaviour.
For Example: Frooti – Mango drink
If Frooti – Apple drink, out of frame of reference.
POINTS-OF-DIFFERENCE (PODS)
Attributes or benefits consumer strongly associate with brand, positively evaluate, and believe they could not find to the same extent with the competitive brand.
Examples
design
performance
POINTS-OF-PARITY (POPS)
Associations that are not necessarily unique to the brand but may in fact be shared with other brands.
POPs may not be the reason to choose the brand, but their absence can certainly be the reason to drop the brand.
For example: Savlon & Dettol
CONCLUSIONProduct & it’s Characteristics
Product Differentiation
Product Line Analysis
New Product Development
Challenges to New Product Development
Consumer Adoption Process
CONCLUSIONBranding & it’s Scope
Brand Equity
Brand Elements
Brand Revitalization
Branding Strategy
Brand Positioning