MARKETING STRATEGY

O.C. FERRELL • MICHAEL D. HARTLINE

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Product Strategy
PRODUCT CLASSIFICATION (1 OF 3)

• Consumer Product Classifications

• Convenience Products
• Shopping Products
• Specialty Products
• Unsought Products
• (1) Products of which consumers are
unaware
• (2) Products that consumers do not
consider
purchasing until a need or emergency
arises
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SPECIALTY PRODUCTS

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PRODUCT CLASSIFICATION (2 OF 3)

• Business Product Classifications

• Raw Materials
• Component Parts
• Process Materials
• MRO Supplies
• Accessory Equipment
• Installations
• Business Services
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RAW MATERIAL

• Basic natural
materials

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 COMPONENT PARTS

• Finished item, that

become a parts of
larger finished
product

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 PROCESS MATERIALS

• Finished products
that become
unidentifieble upon
their inclusion in the
finished product

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 MAINTANANCE, REPAIR, AND
OPERATING PRODUCTS
• Product thta are
use in business
process or
operations but not
become a part of
the finished product

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 ACCESSORY EQUIPTMENT

• Product that help

facilitate
production or
operations but do
not become part of
the finished product

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 INSTALLATION

• Major purchases,
typically of physical
nature, that are
based on
customized solutions
including
installation/construc
tion, training,
financing,
maintanance, and
repairing
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 BUSINESS SERVICES

• Intangible products
that support
business operations.
These purchases
often occure as a
part of
ourtsourching
decision

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PRODUCT CLASSIFICATION (3 OF 3)

• Product Lines and Mixes

• Product Line
• Product Mix
• Benefits of offering a wide variety
and deep assortment of products:
• Economies of Scale
• Package Uniformity
• Standardization
• Sales and Distribution Efficiency
• Equivalent Quality Beliefs
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 PRODUCT LINES AND
PRODUCT MIXES AT GILLETTE

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Exhibit 7.1
 DISCUSSION QUESTION

• Consider the number of product

choices that are available in the U.S.
consumer market. In virtually every
product category, consumers have
many, many options to fulfill their
needs. Are all of these options really
necessary? Is having this many
choices a good thing for
consumers? Why or why not?
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NEW PRODUCT DEVELOPMENT
• Six strategic product development
options:
• (1) New-to-the-world products
(discontinuous innovations)
• (2) New product lines
• (3) Product line extensions
• (4) Improvements or revisions of existing
products
• (5) Repositioning
• (6) Cost reductions
• Customer perception of
differentiation is critical 7-16
AVIS: “WE TRY HARDER”

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 PRODUCT STRATEGY
THROUGHOUT THE LIFE CYCLE
• Development Stage
• Introduction Stage
• Growth Stage
• Maturity Stage
• Decline Stage

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STAGES OF THE PRODUCT LIFE
CYCLE

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Exhibit 7.2
MARKETING STRATEGY DURING
THE PRODUCT LIFE CYCLE

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Exhibit 7.3
 DEVELOPMENT STAGE
• No sales revenue during this stage
• Components of the product concept:
• An understanding of desired uses and benefits
• A description of the product
• The potential for creating a complete product line
• An analysis of the feasibility of the product concept
• Customer needs should be discerned before
developing marketing strategy

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 INTRODUCTION STAGE
• Begins when development is complete
• Ends when customers widely accept the product
• Marketing strategy goals during this stage:
• Attract customers by raising awareness and interest
• Induce customers to try and buy
• Engage in customer education activities
• Strengthen or expand channel and supply relationships
• Build on availability and visibility
• Set pricing objectives

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 GROWTH STAGE (1 OF 2)
• Be ready for sustained sales increases
• Rapid increase in profitability early in the growth stage
that decreases at the end of this stage
• Length depends on nature of product and
competitive reactions
• Two strategies:
• (1) Establish a strong, defensible marketing position
• (2) Achieve financial objectives

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 GROWTH STAGE (2 OF 2)
• Marketing strategy goals in this stage:
• Leverage the product’s perceived differential
advantages
• Establish a clear product and brand identity
• Create unique positioning
• Maintain control over product quality
• Maximize availability of the product
• Maintain or enhance the product’s profitability to
partners
• Find the ideal balance between price and demand
• Keep an eye focused on the competition
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 MATURITY STAGE (1 OF 2)

• Few, if any, new firms will enter the

market
• Still an opportunity for new product
features and variations
• Typically the longest stage in the
product life cycle

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 MATURITY STAGE (2 OF 2)
• Four general goals in this stage:
• (1) Generate Cash Flow
• (2) Hold Market Share
• (3) Steal Market Share
• (4) Increase Share of Customer
• Four options to achieve these goals:
• (1) Develop a new product image
• (2) Find and attract new users to the product
• (3) Discover new applications for the product
• (4) Apply new technology to the product

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 DECLINE STAGE
• Two options:
• (1) Attempt to postpone the decline
• (2) Accept its inevitability
• Harvesting
• Divesting
• Factors to be considered during this stage:
• Market segment potential
• The market position of the product
• The firm’s price and cost structure
• The rate of market deterioration

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 MARKETING STRATEGY IN ACTION

• Ford has been creative in restyling the 2005 Mustang with

retro styling cues to keep the model viable despite
decreasing interest in “muscle cars.” What other ways can
marketers combat the inevitability of the decline stage of
the product life cycle?
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 DISCUSSION QUESTION

• Describe the different product decisions

that impact each phase of the product
life cycle. If you were losing money with
a product in the decline stage, why
might you consider retaining that
product? Why would a firm or brand
manager become sentimental about a
product and hold on to it even in the
face of monetary losses?
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 BRAND

A brand is a name, term, design, symbol, or

combination of these elements that identifies a
product or service and distinguishes it from its
competitors. Brands include elements such as:
• Brand and trade names
• Trade and brand marks, and trade characters

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 BRANDING STRATEGY
• Key Issues In Branding
• Brand Loyalty
• Brand Equity
• Brand Alliances
• Packaging and Labeling
• Packaging
• Protection, storage, convenience, etc.
• Labeling
• The Nutritional Labeling and Education Act of 1990
• Food Choking Prevention Act

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 PACKAGE AND LABEL

• A package is the physical container or wrapping for a

product. Developing a product’s package is an
integral part of product planning and promotion
because the package is a selling tool.
• A label is an information tag, wrapper, seal, or
imprinted message that is attached to a product or
its package. Its main function is to inform
customers about the product’s contents and give
directions for its use.

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CO-BRANDING

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SUMBER : HTTP://MNURCHOLIS.LECTURE.UB.AC.ID/FILES/2013/02/MATERI-11-PENGEMASAN-DAN-
PENYIMPANAN.PDF
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ADVANTAGES OF BRANDING

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Exhibit 7.4
THE WORLD’S TWENTY-FIVE
MOST VALUABLE BRANDS

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Exhibit 7.5
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PRODUCT STRATEGY FOR SERVICES

• Characteristics of Services
• Marketing Strategy for Services
• Product Issues
• Pricing Services
• Promoting Service Benefits
• Distributing Services

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UNIQUE CHARACTERISTICS OF SERVICES
AND RESULTING MARKETING
CHALLENGES

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Exhibit 7.6
 DISCUSSION QUESTION

• Given the unique characteristics of

services, what potential ethical
issues could arise in service
marketing and delivery? How can a
service marketer prevent ethical
challenges and convey a sense of
trust to customers?

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 TUGAS INDIVIDU

• Dengan mengunakan kerangka atribut

bangunlah keseluruhan pernyataan
branding tentang diri anda.
- Bagaimana orang lain terutama atasan
di masa depan akan melihat brand anda?
- Area mana yang harus anda
tingkatkan ?
- Apakah merek anda menjawab
pertanyaan kunci mengenai kemampuan
anda di dunia kerja ?
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• Buat penelitian mengenai sikus hidup produk
kelompok, pada tahap sikus mana produk anda
saat ini ? Karakteristik apa yang membuktikan hal
tersebut ? Apakah ada kemungkinan bahwa pasa
sedang bergerak ke tahap selanjutnya ?

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