PRODUCT

MANAGEMENT
LEARNING
OBJECTIVES
Types of products
Characteristics of technology
products,
commodity products and
customized products
The concept of a product and a
brand
Various elements of the
product line and
the product mix
Decisions regarding product
mix modifications
The issue of excessive product
variants, and
its management
Learni ng Obj ecti ves ( Contd. )
Managing the product lines and brands
over a period of time: The concept of the
product life cycle
Managing product and brand portfolios
in multi-product, multi-brand companies
Deciding product strategies for planning
growth in existing and new markets
Planning and managing product recalls
PRODUCT
Product is the most important element in the
marketing mix
Product provides the functional requirements
sought by consumers
Product is the reason the customer gets interested
in the company
Devote best people and systems to develop
products for customers
BUSINESS PRODUCT AND
CONSUMER PRODUCT
Business products are used to manufacture other goods
or services, to facilitate an organizations operations, or
to resell to other customers
Consumer products are bought to satisfy an individuals
personal wants
Same product can be classified as business product or
consumer product depending on intended use
TYPES OF CONSUMER
PRODUCTS
Convenience product / Fast moving consumer
goods
Shopping product / Durable goods
Specialty product
Unsought product
TECHNOLOGY
PRODUCTS
Control-Chaos
Freedom-Enslavement
New-Obsolete
Intelligence-Stupidity
Efficiency-Inefficiency
Fulfilling needs-Creating new needs
Assimilation-Isolation
Engagements-Disengagements
COMMODITY
PRODUCTS
Hard to differentiate
Reducing risk means of differentiation
Price wars should be avoided
Show evidence of risk reduction
Understand what causes risk - variations in
product specifications, supply, or demand
Charge premium to insure customer against the
risk
CUSTOMIZED
PRODUCTS
Customers do not want more choices
Match or make a product which is suitable for the
customer
Have a learning relationship with the customer
Customization through modular design
Customization easier and less costly in digital
products
Learning relationships with customers
PRODUCT AND
BRAND
A product is anything which is capable of
satisfying customer need
Branding is the process by which companies
distinguish their product offerings from those of
the competition

PRODUCT LINE AND
PRODUCT MIX
Product item
Product line
Depth of a product line
Product mix
Width of product mix
PRODUCT-MIX
MODIFICATIONS
Product mix expansion
Line extension
Mix extension
Trading up
Trading down
Product mix contraction
Repositioning
Product modification
Planned obsolescence
Components of the Market
Offering
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Value-based prices
Services mix
and quality
Product features
and quality
Attractiveness of
the market offering
Five Product
Levels
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Potential product
Augmented product
Expected product
Basic product
Core benefit
Consumer Goods
Classification
6/ 23/ 2014 13- 15


Specialty Products
Unsought Products
Shopping Products
Buy less frequently
> Gather product information
> Fewer purchase locations
> Compare for:
Suitability & Quality
Price & Style
Convenience Products
Special purchase efforts
> Unique characteristics
> Brand identification
> Few purchase locations
New innovations
> Products consumers dont
want to think about.
>Require much advertising &
personal selling
Buy frequently & immediately
> Low priced
> Many purchase locations
> Includes:
Staple goods
Impulse goods
Emergency goods
Product
Mix
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Width - number of
different product
lines
Length - total
number of items
within the lines
Depth - number of
versions of each
product
Product Mix -
all the product
lines offered
Product Line
Length
Line Stretching
Downmarket
Upmarket
Two-way
Line Filling
Line Modernization
Line Featuring & Line Pruning
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Two-Way Product-Line Stretch:
Marriott Hotels
6/ 23/ 2014 13- 18
Quality
Economy
Superior
Standard Good
Price
High
Above
average
Average
Low
Fairfield Inn
(Vacationers)
Courtyard
(Salespeople)
Marriott
(Middle
managers)
Marriott
Marquis
(Top
executives)
What is a
Brand?
6/ 23/ 2014 13- 19
Attributes Benefits Values
Culture
User
Personality
Brand
Equity
6/ 23/ 2014 13- 20
No Brand Loyalty
(customer will change)
Satisfied Customer
(no reason to change)
Satisfied & Switching Cost
Values the Brand
(brand as friend)
Devoted
to Brand
An Overview of Branding
Decisions
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Branding
Decision
Brand-
Sponsor
Decisio
n
Brand-
Name
Decision
Brand-
Repositioning
Decision
Brand-
Strategy
Decision
Brand

No brand
Manu-
facturer
brand

Distribu-
tor
(private)
brand

Licensed
brand
Individual
brand
names

Blanket
family
name

Separate
family
names

Company-
individual
names
Reposi-
tioning

No
reposi-
tioning
Line
extension

Brand
extension

Multi-
brands

New
brands

Cobrands
Brand
Strategies
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Brand
Extension
New
B
r
a
n
d

N
a
m
e

Product Category
Line
Extension
Existing
Existing
Multibrands
New
New
Brands
Good Brand
Names:
6/ 23/ 2014 13- 23
Suggest
Product
Benefits
Distinctive
Lack Poor
Foreign
Language
Meanings
Suggest
Product
Qualities
Easy to:
Pronounce
Recognize
Remember
Package Crucial as
Marketing Tool
Self-service

Consumer affluence

Company & brand image

Opportunity for innovation
6/ 23/ 2014 13- 24
Labels
6/ 23/ 2014 13- 25
Identify
Describe

Promote