Marketing Management II

Session Plan

• Session 1,2,3: Introduction, Product Management

• Session 4-5: Branding and Positioning
• Session 6-7: Services Marketing
• Session 8,9,10 : Pricing Decisions
• Session 11,12,13: Personal Selling
• Session 14-15: Channel Management
• Session 16-17: Integrated Marketing Communication
• Session 18: Digital Marketing
• Session 19-20: Presentation
Evaluation
• Class assignments: 20 marks
– Evaluation criteria: Rubrics
• Mid term: 20 marks
• Marketing Plan and presentation: 20 Marks
– Evaluation Criteria:
• Student rubric for group evaluation
• Group evaluation rubric
• Presentation Rubric
Student Rubric for Group Evaluation
Rubric for Group evaluation
Criteria Levels
Level 4 Level 3 Level 2 Level 1
(100-90%) (89-80%) (79-70%) (69-60%)
Team work

Contribution
Subject knowledge

Supporting material

Composition/Format

Adhering to deadlines
Rubrics for Final Presentation
Criteria Levels
Level 4 Level 3 Level 2 Level 1
(100-90%) (89-80%) (79-70%) (69-60%)
Content and
creativity
Coherence and
organization/Visua
ls
Subject
knowledge
Speaking skills
and participation
Rubrics for Individual Assessment

Criteria Levels

Level 4 Level 3 Level 2 Level 1

(100-90%) (89-80%) (79-70%) (69-60%)

Lessons learned

Application of
theory in practice
Product Management
Product :Definition
• A product is any offering by a company to a market that serves to A PRODUCT CAN BE
satisfy customer needs and wants.
• Key element in marketing mix
• It is the totality of what a customer buys
• Restaurant’s product is: food + ambiance + service + cleanliness +
other things
Organization
• Computer Operating System is: software + development environment
(hardware and software) + documentation to use it + training program
+ suppliers service & troubleshooting capabilities + availability of
hardware drivers + suppliers enhancement plans
 Product Levels-Customer Value Hierarchy

• Core benefit/generic product – it is the fundamental level.

This is the basic product and the focus is on the purpose for
which the product is intended
• Basic product/ branded product –This represents all the
qualities of the product.
• Expected product/differentiated or customized product
– a set of attributes and conditions buyers normally expect
when they purchase the product.
• Augmented product/ - This refers to all additional factors
which sets the product apart from that of the competition.
• Potential product – encompasses all the possible
augmentations and transformation that the product may
undergo in the future.
Customer Value Hierarchy
Product : Classification
DURABILITY &
CONSUMER GOOD INDUSTRIAL GOODS
TANGIBILITY

• Convenience goods Goods purchased by a business to

• Non Durable
• Tangible
• Shopping goods
• Rapidly consumed
• Minimum buying effort
• Eg. Milk, Bread
• Durable
• Tangible
• Specialty goods
• Lasting a longer time
• Eg. Microvave Oven
• Services
• Intangibility
• Inseperability
• Unsought goods
• Heterogeneity
• Eg. consulting
Inexpensive products that require little time and effort on produce other goods or to resell to
the purchase decisions and are purchased regularly. consumers.
• Materials and parts
Products that usually require a great deal of time and • Farm products
effort for the purchase decision. Consumers search and • Natural products
compare similar products prior to purchase. Clothing
items and hardware or appliances are often considered • Component materials
shopping goods. • Component parts
• Capital items
Sought by a consumer who desires a specific brand or • Installations
product. The consumer will not accept a substitute. The • Equipment
consumer may have saved money for long period of
time before purchasing or may have to borrow money to • Supplies and business services
purchase. Examples: Rolex watch, house, boat. • Maintenance and repair
• Advisory services
Goods that the consumer does not know about or does
not normally think of buying, and the purchase of which
arises due to danger or the fear of danger and lack of
desire. Eg. Funeral service, insurance
Mktg considerations
Convenience Shopping Specialty Unsought
Customer buying Frequent purchase, Less frequent Strong brand Little pdt awareness,
behavior little planning, little purchase, much preference & loyalty , knowledge(or,if even
comparison or planning & shopping special purchase aware , little or even
shopping effort, low effort, comparison of effort , little negative interest,)
customer involvement brands on price, comparison of brands
quality & style. , low price sensitivity

Price Low price Higher price High price Varies

Distribution Wide Wide spread dist in Selective dist in fewer Varies
spread,convenient many outlets per outlets
locations market area

Promotion Mass promotion by Advtg & personal More carefully Aggressive advtg &
the producer selling by both targeted promotion by personal selling by
producer & resellers both producer & producer & reseller
reseller

Examples Toothpastes,laundry Major appliances , Luxury goods eg Life insurance , Red

detergents furniture & clothing Rolex, property, Cross blood
donations
Main tasks in Product Management
• Appraisal of each product line and each product in the line
• Decisions of packaging
• Managing the PLC
• Innovations and new product development
• Differentiation and Positioning
• Managing Brands
Product : Mix

• It is the set of products that a particular company offers to buyers and it consist of
various product lines.
• Product Line: It is a group of products that is closely related because they perform a
similar function, targeted at the same customer groups, marketed through same channel.

• There are 4 dimensions

– Width – No. of different product lines
– Length – Total no. of items in the product line
– Depth – Assortment of size, color, model offered in each item of product line
– SKU/product item- Independent item of a product/brand offered for a sale
 Width - Eight (Hair care, Oral care etc.)

Product Mix Length - Twenty Eight

Average Line Length – 3.5
Depth - Lifebuoy has six variants : Lifebuoy Lemon Fresh Soap bar, Lifebuoy Vita Protect Soap bar,
Lifebuoy Natural Betel Leaf Soap Bar, Lifebuoy moisture plus soap bar, Lifebuoy mild care soap bar. If
each one is available in 3 different sizes, then depth would 18 (6x3)
Product Mix of HUL

Personal Care Home Beverages

Care

Hair Care Oral Care Deodorants Skin Care Personal Wash Soaps & Detergent Coffee Tea
Clinic Pepsode Axe Ponds Lux Surf Bru Brooke
Plus nt Excel Bond
Sunsilk Close Up Rexona Fair & Rexona Rin Lipton
Lovely
Pond’s Vaseline Liril Wheel Red
Lifebuoy Label
Dove Lakme Vim
Pears
Dove
Breeze
Hamam
Product Line Strategies
• Strategic Alternatives
1. To increase the length of a product line
1. Downward stretch strategy
2. Upward stretch Strategy
3. Two way stretch strategy
4. Line filling Strategy
2. To decrease the length of a product line(line
pruning)
1. They are not successful
2. They reach the decline stage
3. Long product line marketing costs are too
high
Product Mix Strategies

• Strategic Alternatives
– To increase the product
line
– To decrease the product
line
 Decisions on Packaging.

Packaging : All the activities of designing and producing the container for a product Packaging objectives:
➢ Identify the brand
➢ Primary Package ➢ Convey description and
➢ Secondary Package persuasive information
➢ Shipping Package ➢ Facilitate product
transportation and protection
Factors that contribute to the growing ➢ Assist at home storage
of packaging as a marketing tool: ➢ Aid product consumption
➢ Self service
➢ Consumer Affluence
➢ Company and Brand Name
Image
➢ Innovation Opportunity
Product packaging –Labelling, Warrantees, Guarantees
Labelling : -Warrantees :
➢ Simple tag attached to the product or an elaborately Formal statements of expected product performance by the
manufacturer
designed graphic that is part of the package.
All sellers are legally responsible for buyer’s normal or
➢ Carry only the brand name or a great deal of information. reasonable expectations.
➢ Functions of labels: Products under warrantees can be returned
✓ Identify -Guarantees :
✓ Grade Reduce buyers risk. They suggest that the product is of
high quality and that the company and its service
✓ Describe performance are dependable.
✓ Promote
Product Life Cycle
Product Life-Cycle Strategies

• The Typical Product Life Cycle (PLC) Has Five Stages

– Product Development, Introduction, Growth, Maturity,

Decline
Product Life-Cycle Strategies

• Begins when
PLC Stages the company
develops a
• Product new-product
development idea
• Introduction • Sales are zero
• Growth • Investment
• Maturity costs are high
• Decline • Profits are
negative
Product Life-Cycle Strategies-Introduction

• Low sales
PLC Stages
• High cost per
• Product customer
development acquired
• Introduction • Negative profits
• Growth • Innovators are
• Maturity targeted
• Decline • Little
competition
Product Life-Cycle Strategies-Growth

• Rapidly rising sales

PLC Stages
• Average cost per
• Product customer
development • Rising profits
• Introduction • Early adopters are
• Growth targeted
• Maturity
• Growing
• Decline competition
Product Life-Cycle Strategies--Maturity

PLC Stages • Sales peak

• Low cost per
• Product customer
development
• Introduction • High profits
• Growth • Middle majority are
• Maturity targeted
• Decline • Competition begins
to decline
Product Life-Cycle Strategies--Decline

PLC Stages • Declining sales

• Low cost per
• Product customer
development
• Introduction • Declining profits
• Growth • Laggards are
• Maturity targeted
• Decline • Declining
competition
Technology Life-Cycle: S Curve
Class exercise on PLC

Discuss Strategies for each stage of PLC for any

product/service. Choose any product or service in each stage
of PLC and analyze how the company would revise its
marketing strategy according to the product’s positioning in
the Product Life Cycle chart. For example, when Coke hit a
decline stage, the company diversified and introduced Coke
Zero and other flavors of Coke. Or, when Dove sales
plummeted, the company focused on re-branding and based
its marketing strategy on a re-conception of the idea of
beauty.
Marketing Strategies: Introduction Stage

• Product – Offer a basic product

• Price – Use cost-plus basis to set
• Distribution – Build selective distribution
• Advertising – Build awareness among early
adopters and dealers/resellers
• Sales Promotion – Heavy expenditures to
create trial
Marketing Strategies: Growth Stage

• Product – Offer product extensions, service,

warranty
• Price – Penetration pricing
• Distribution – Build intensive distribution
• Advertising – Build awareness and interest
in the mass market
• Sales Promotion – Reduce expenditures to
take advantage of consumer demand
Marketing Strategies: Maturity Stage

• Product – Diversify brand and models

• Price – Set to match or beat competition
• Distribution – Build more intensive
distribution
• Advertising – Stress brand differences and
benefits
• Sales Promotion – Increase to encourage
brand switching
How stages of the product life cycle relate to firm’s
marketing objectives & marketing mix actions

INTRODUCTION GROWTH MATURITY DECLINE

Product Limited models More models Large number Eliminate

Strategy Frequent Frequent of models. unprofitable
changes changes. models

Distribution Limited Expanded Extensive. Phase out

Strategy Wholesale/ dealers. Long- Margins drop. unprofitable
retail distributors term relations Shelf space outlets

Awareness. Aggressive ads. Advertise. Phase out

Promotion Stimulate Stimulate Promote promotion
Strategy demand.Sampling demand heavily

Higher/recoup Fall as result of Prices

Prices fall
Pricing development competition & stabilize at
(usually).
Strategy costs efficient produc- low level.
tion.
What is a new product ?
• Booz, Allen & Hamilton identified six types of new products related to their newness to the
company and the marketplace. They are:
• New-to-the-World Products: New-to-the-world products are those products that create an
entirely new market.
• New-Product Lines: If a company can enter an established market for the first time with a
product, it is called a new product line.
• Additions to Existing Product Lines: New products that supplement a company’s
established product lines are called additions to existing product lines.
• Improvements in / Revisions to Existing Products: New products that provide improved
performance or greater perceived value and replace existing products are referred to as
improvements in/revisions to existing products.
• Repositioning: Repositioning is modifying the existing products/brands in some way to widen
their appeals or direct appeals to other market segments(s).
 Product Innovation

Product
innovation

Radical Incremental
innovation innovation

New products
Major Start up product line Product
for market Style Change
innovations business extension improvements
presently served
Rogers theory of diffusion
Diffusion of innovation
Stages of New Product
Development
Assessing New Product Feasibility
Test Marketing