setting product strategy marketing management, 13 th ed 12
TRANSCRIPT
Setting Product Strategy
Marketing Management, 13th ed
12
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 12-2
Chapter Questions
• What are the characteristics of products and how do marketers classify products?
• How can companies differentiate products?
• How can a company build and manage its product mix and product lines?
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Chapter Questions (cont.)
• How can companies combine products to create strong co-brands or ingredient brands?
• How can companies use packaging, labeling, warranties, and guarantees as marketing tools?
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Caterpillar: A Great Product
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What is a Product?
A product is anything that can be offered to a market to satisfy a want or
need, including physical goods, services, experiences, events, persons,
places, properties, organizations, information, and ideas.
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Figure 12.1 Components of the Market Offering
Attractiveness of the market
offering
Value-based prices
Product features and quality
Services mix and quality
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Figure 12.2 Five Product Levels
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The Wedding Market is a MetaMarket
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Product Classification Schemes
Durability
Use
Tangibility
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Durability and Tangibility
Nondurable
goods
ServicesDurable
goods
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Consumer Goods Classification
Convenience
Unsought
Shopping
Specialty
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Industrial Goods Classification
Materials and parts
Supplies/
business servicesCapital items
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Product Differentiation
• Product form• Features• Customization• Performance• Conformance• Durability• Reliability• Repairability• Style
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Dunkin’ Donuts’ Differentiation
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Design Differentiation
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Service Differentiation
• Ordering ease• Delivery• Installation• Customer training• Customer consulting• Maintenance and
repair• Returns
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Maintenance and Repair
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The Product Hierarchy
Need family
Product family
Product class
Product line
Product type
Item
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Product Systems and Mixes
• Product system• Product mix• Product assortment• Depth• Length• Width• Consistency
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Product Line Analysis
Convenience
items
Core product Staples
Specialties
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Figure 12.3 Product Item Contributions to a Product Line’s
Total Sales and Profits
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Figure 12.4 Product Map
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Line Stretching
Down-Market StretchDown-Market Stretch
Up-Market StretchUp-Market Stretch
Two-Way StretchTwo-Way Stretch
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Line Filling
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Pruning
Pruning weak brands can strengthen the remaining brands in the line
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Product-Mix Pricing
• Product-line pricing
• Optional-feature pricing
• Captive-product pricing
• Two-part pricing
• By-product pricing
• Product-bundling pricing
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Product Line Pricing
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Two-Part Pricing
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Co-branding
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Ingredient Branding
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What is the Fifth P?
Packaging, sometimes called the fifth P, is all the activities of designing and producing the
container for a product.
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Factors Contributing to the Emphasis on Packaging
Self-serviceSelf-service
Consumer affluenceConsumer affluence
Company/brand imageCompany/brand image
Innovation opportunityInnovation opportunity
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Innovations in Packaging
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Packaging Objectives
• Identify the brand
• Convey descriptive and persuasive information
• Facilitate product transportation and protection
• Assist at-home storage
• Aid product consumption
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Functions of Labels
Identifies
Grades
Describes
Promotes
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Warranties and Guarantees
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Marketing Debate
With products, is it form or function?
Take a position:1. Product functionality is the key to brandsuccess.
or
2. Product design is the key to brand success.
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Marketing Discussion
Consider the different means ofdifferentiating products and services.
Which ones have the most impact on your choices?
Why?