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11

Setting
Product
Strategy
11
Setting Product Strategy

Chapter Questions


What are the characteristics of products and
how do marketers classify products?
How can companies differentiate products?
Why is product design important and what
factors affect a good design?

Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from
the United States edition of Marketing Management, 14e.

11-2

warranties. labeling. 14e. Authorized adaptation from the United States edition of Marketing Management. 11-3 . and guarantees as marketing tools? Copyright © 2013 Dorling Kindersley (India) Pvt Ltd.Chapter Questions    How can a company build and manage its product mix and product lines? How can companies combine products to create strong co-brands or ingredient brands? How can companies use packaging.

and ideas. Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. experiences. organizations. including physical goods. 14e. information. properties. persons.What Is a Product? A product is anything that can be offered to a market to satisfy a want or need. Authorized adaptation from the United States edition of Marketing Management. places. 11-4 . services. events.

11-5 . Authorized adaptation from the United States edition of Marketing Management.Figure 11. 14e.1 Components of the Market Offering Copyright © 2013 Dorling Kindersley (India) Pvt Ltd.

11-6 .2 Five Product Levels Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management.Figure 11. 14e.

Product Classification Schemes Durability Tangibility Use Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management. 11-7 . 14e.

14e. 11-8 .Durability and Tangibility Nondurable goods Durable goods Services Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management.

Consumer Goods Classification Convenience Shopping Specialty Unsought Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-9 . 14e. Authorized adaptation from the United States edition of Marketing Management.

Industrial Goods Classification    Materials and parts Capital items Supplies/business services Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management. 11-10 . 14e.

11-11 . 14e.Product Differentiation      Product form Features Customization Performance Conformance     Durability Reliability Repairability Style Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management.

Authorized adaptation from the United States edition of Marketing Management. 11-12 .Service Differentiation        Ordering ease Delivery Installation Customer training Customer consulting Maintenance and repair Returns Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 14e.

Design Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-13 . Authorized adaptation from the United States edition of Marketing Management. 14e.

14e. Authorized adaptation from the United States edition of Marketing Management.The Product Hierarchy Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-14 .

11-15 . Authorized adaptation from the United States edition of Marketing Management. 14e.Guidelines for Marketing Luxury Brands Copyright © 2013 Dorling Kindersley (India) Pvt Ltd.

Product Systems and Mixes Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-16 . Authorized adaptation from the United States edition of Marketing Management. 14e.

Authorized adaptation from the United States edition of Marketing Management.3 Product-Item Contributions to a Product Line’s Total Sales and Profits Copyright © 2013 Dorling Kindersley (India) Pvt Ltd.Figure 11. 14e. 11-17 .

Figure 11. Shapiro. 77–110). Reprinted by permission of Marketing Science Institute and Benson P. Authorized adaptation from the United States edition of Marketing Management. 14e. Industrial Product Policy: Managing the Existing Product Line (Cambridge. Shapiro. Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-18 . MA: Marketing Science Institute Report No. Copyright © 2003.4 Product Map for a Paper-Product Line Source: Benson P.

Authorized adaptation from the United States edition of Marketing Management.Line Stretching Down-Market Stretch Up-Market Stretch Two-Way Stretch Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 14e. 11-19 .

11-20 . 14e. Authorized adaptation from the United States edition of Marketing Management.Product-Mix Pricing       Product-line pricing Optional-feature pricing Captive-product pricing Two-part pricing By-product pricing Product-bundling pricing Copyright © 2013 Dorling Kindersley (India) Pvt Ltd.

11-21 . Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management. 14e.What Is Cobranding? In co-branding—also called dual branding or brand bundling—two or more well-known brands are combined into a joint product or marketed together in some fashion.

14e. 11-22 . Authorized adaptation from the United States edition of Marketing Management.Ingredient Branding Copyright © 2013 Dorling Kindersley (India) Pvt Ltd.

Consumers must believe the ingredient matters to the performance and success of the end product. Consumers must be convinced that not all ingredient brands are the same and that the ingredient is superior. Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-23 .Requirements for successful ingredient branding 1. 2. 14e. A distinctive symbol or logo must clearly signal that the host product contains the ingredient. 3. Authorized adaptation from the United States edition of Marketing Management. A coordinated “pull” and “push” program must help consumers understand the advantages of the branded ingredient. 4.

14e. Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-24 . Authorized adaptation from the United States edition of Marketing Management.What is the Fifth P? Packaging. sometimes called the 5th P. is all the activities of designing and producing the container for a product.

Factors Contributing to the Emphasis on Packaging     Self-service Consumer affluence Company/brand image Innovation opportunity Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-25 . 14e. Authorized adaptation from the United States edition of Marketing Management.

Packaging Objectives Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 14e. Authorized adaptation from the United States edition of Marketing Management. 11-26 .

Authorized adaptation from the United States edition of Marketing Management.Functions of Labels Identify the product or brand  Grade it  Promote it  Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-27 . 14e.

14e. Authorized adaptation from the United States edition of Marketing Management.For Review    What are the characteristics of products and how do marketers classify products? How can companies differentiate products? Why is product design important and what factors affect a good design? Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 11-28 .

labeling. warranties. 11-29 . Authorized adaptation from the United States edition of Marketing Management. and guarantees as marketing tools? Copyright © 2013 Dorling Kindersley (India) Pvt Ltd. 14e.Also for Review    How can a company build and manage its product mix and product lines? How can companies combine products to create strong co-brands or ingredient brands? How can companies use packaging.