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Product, Branding, and Packaging Concepts
What is a Product?
Product is anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need. Includes:
Physical Objects Services Events Persons Places Organizations Ideas Combinations of
What is a Service?
Service is a form of product that consist of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. Examples include:
Banking Hotels Tax
Preparation Home Repair Services
philosophy. Ideas provide the psychological stimulation that aids in solving problems or adjusting the environment. or issue. image. Example : Mothers Against Drunk Driving (MADD) .What is an idea? An idea is a concept.
The total product .
cars. Unsought Products ØNew innovations ØProducts consumers don’t want to think about ØRequire much advertising & personal selling i. shoes. warranties. blood donation.e Clothing. newspapers Specialty Products ØSpecial purchase efforts ØHigh price ØUnique characteristics ØBrand identification ØFew purchase locations i.Product Classifications Consumer Products Convenience Products ØBuy frequently & immediately ØLow priced ØMass advertising ØMany retail outlets ØSelf service basis (packaging is important) i. Rolex Shopping Products ØBuy less frequently ØHigher price ØFewer purchase locations ØComparison shop (prices. appliances. qualities.e Candy. cameras.e Lamborghini. features) i.e Life insurance. natural 6 catastrophe .
legal. facilitate production) 7. MRO supplies (not part of the finished product. marketing research) 8. Component parts (identified) 5. Accessory equipment (cheaper. Installations (expensive. . time consuming. involve investment of capital) 2. treated as expense item) 3. Raw materials(are bought and sold according 4.Business products Purchased on the basis of the an organization’s goals and objectives Functional aspects are more important than psychological rewards There are seven classifications: 1. Process materials (not identifiable) 6. Business services (financial services.
2. 1. I. Is the number of product lines a company offer.Product line and product mix Product item.Depth. Product line. consisting of width and depth. Chunky White Kit-Kat. I.e. Product mix. etc... Total or group of products available in an organization. product line. .. A specific product of an organization’s overall products.Width.e. Is the average number of product items that exist in a product line. shampoo product line. A group of similar products in a certain product category.
Product Life Cycle Sales and Profits ($) Profits Time Product Develop ment Losses/ Investments ($) Sales and Profits Over the Product’s Life From Inception to Demise 9 Sales Introduction Growth Maturity Decline .
Objectives. & Strategies Sale s Sale s Co sts Co sts Pro fits Pro fits Marke ting Marke ting Obje c tive s Obje c tive s Pro duc tt Pro duc Pric e Pric e Distributio n Distributio n Adve rtising Adve rtising Lo w sale s Lo w sale s Hig h c o st pe r c usto me r Hig h c o st pe r c usto me r Ne g ative o r lo w Ne g ative o r lo w Cre ate pro duc t aware ne ss and Cre ate pro duc t aware ne ss and trial trial Offe r a basic pro duc tt Offe r a basic pro duc Usually is high. use c o stplus fo rmula fo rmula High distributio n expe nse s High distributio n expe nse s Build pro duc t aware ne ss amo ng Build pro duc t aware ne ss amo ng e arly ado pte rs and de ale rs e arly ado pte rs and de ale rs 10 .Introduction Stage of the PLC Summary of Characteristics. use c o stplus Usually is high.
se rvic e . the n de c line Rising pro fits. Offe r ne w pro duc t fe ature s. se rvic e . exte nsio ns. Objectives. and warranty Pric e re duc tio ns to pe ne trate Pric e re duc tio ns to pe ne trate marke tt marke Inc re ase numbe r o f distributio n Inc re ase numbe r o f distributio n o utle ts o utle ts Build aware ne ss and inte re st in Build aware ne ss and inte re st in the mass marke tt the mass marke 11 .Growth Stage of the PLC Summary of Characteristics. and warranty exte nsio ns. the n de c line Maximize marke t share Maximize marke t share Offe r ne w pro duc t fe ature s. & Strategies Sale s Sale s Co sts Co sts Pro fits Pro fits Marke ting Marke ting Obje c tive s Obje c tive s Pro duc tt Pro duc Pric e Pric e Distributio n Distributio n Adve rtising Adve rtising Rapidly rising sale s Rapidly rising sale s Lo we r c o sts due to e c o no mie s o f Lo we r c o sts due to e c o no mie s o f sc ale sc ale Rising pro fits.
Maturity Stage of the PLC Summary of Characteristics. & Strategies Sale s Sale s Co sts Co sts Pro fits Pro fits Marke ting Marke ting Obje c tive s Obje c tive s Pro duc tt Pro duc Pric e Pric e Distributio n Distributio n Adve rtising Adve rtising Pe ak sale s Pe ak sale s Lo w c o st pe r c usto me r Lo w c o st pe r c usto me r Co ntinue to fall Co ntinue to fall De fe nd marke t share thro ugh De fe nd marke t share thro ugh pro duc t impro ve me nts pro duc t impro ve me nts Dive rsify brand and mo de ls Dive rsify brand and mo de ls Pric e to matc h with be st Pric e to matc h with be st c o mpe tito rs c o mpe tito rs Build mo re inte nsive (glo bal) Build mo re inte nsive (glo bal) distributio n distributio n Stre ss brand diffe re nc e s and Stre ss brand diffe re nc e s and be ne fits be ne fits 12 . Objectives.
Mainly pric e and pro mo tio n 13 . Modifying the Mar keting Mix Co mpany trie s to impro ve sale s by c hanging o ne o r mo re marke ting mix e le me nts. Maintaining share o f marke t Modifying the Product Changing c harac te ristic s suc h as quality.Maturity Stage of the PLC Modifiying the Market Co mpany trie s to inc re ase c o nsumptio n o f the c urre nt pro duc t. o r style s to attrac t ne w use rs. fe ature s.
reposition. & Strategies Sale s Sale s Co sts Co sts Pro fits Pro fits Marke ting Marke ting Obje c tive s Obje c tive s Pro duc tt Pro duc Pric e Pric e Distribution Distribution Advertising Advertising De c lining sale s De c lining sale s Lo w c o st pe r c usto me r Lo w c o st pe r c usto me r De c lining pro fits De c lining pro fits Reduce expenditure and maintain. harvest or drop the product reposition. harvest or drop the product Phase out weak items Phase out weak items Cut price Cut price Go selective: phase out unprofitable Go selective: phase out unprofitable outlets outlets Reduce to level needed to retain Reduce to level needed to retain hardcore loyal customers hardcore loyal customers 14 .Decline Stage of the PLC Summary of Characteristics. Objectives. Reduce expenditure and maintain.
which are: 1.Product adoption process Customers who eventually accept a new product do so through an adoption process.Trial 5.Interest 3.Adoption .Evaluation 4.Awareness 2.
2004.Figure 7. p182) .2 Innovation Diffusion Theory (Luftman.
Example: Tide Brand mark.Branding Brand. Example: Nike sign Trademark. Used to differentiate product items. Example: P&G Brand name. Trade name. Patency rights Example: Ford Motor Company . The whole lot of benefits given by a product.
Brand names help call consumers' attention to new products that might benefit them. Buyers who always buy the same brand know that they will get the same quality each time they buy. 2.VALUE OF BRANDING Value is to both buyers and sellers. Brand names tell the buyer something about product quality. Imagine a buyer going into a supermarket and finding thousands of generic products. Buyers benefits are as follows: 1. The brand name becomes the basis upon which a whole story can be built about the new product's special qualities . 3. Brand names also increase the shopper's efficiency.
Branding helps the supplier to segment markets.VALUE OF BRANDING Sellers benefits are as follows: 1. Branding enables the supplier to attract a loyal and profitable set of customers. The brand name makes it easier for the supplier to process orders and track down problems. 4. 3. Cadbury can offer Daily Milk. 2. not just one general confectionery product for all consumers. Milk Tray. . The supplier's brand name and trademark provide legal protection for unique production features that otherwise might be copied by competitors. Fruit and Nut and many other brands. Roses. Flake. For example.
20 g n o rt tS S n a ro B r n d g n a r B d io cs o ss sA A n o ii tc a n o i t a to lL a y o L y t l a y y b ir rt tt tA A sb e ti u s e t u io sC n o C y ci n e ts sn y c n e t s .ir e ce rP e P Q c d e v y tv ii le a u Q d e y t i l a u e m a N ra a w A N se sm e n e r a w A s s e n e B i h g iH H d n a rg h B d n a r ta iu lQ a u Q V i & l y e u lt a V & y e u l a Branding Advantages Advantages of of Brand Names Brand Names ie td n e d II o ii tf a ci it fn n o i t a c n Brand Brand Equity Equity This Land-O-Lakes ad shows the depth of the brand.
personality type Perceived high brand quality helps to support a premium price .Brand recognition 2. 1.Brand insistence Brand awareness contribute to brand familiarity. a familiar brand is likely to be in a consideration set Brand associations are dimensions such as lifestyle.Brand equity There are three degrees of brand loyalty.Brand preference 3.
Types of brands Manufacturer brands Private distributor brands Generic brands .
spell.Outsource 5.Special department for developing brand names in large companies 4.Internally through brainstorming 2. 6. . Example.Selecting brand names Characteristics of brand names: 1.Designed to be recognizable in all types of media Who creates them? 1.Should indicate product benefits.Easy to say.Committees for brand creation and approval 3.Brand should be distinctive 4. and recall 2. Vanish 3.
Cartier watches. Examples. Louis Vuitton handbags . arbitrary. GM parts. suggestive. generic Most protectable are the descriptive and the suggestive Least protectable or even not protectable are the generic brand names. descriptive.Protecting a brand Types of brands are fanciful. Companies should try to protect their brands from counterfeited products.
Kelloggs . the company may use individual branding. family branding Individual branding is a policy used for heterogeneous products that needs to be differentiated (facilitates market segmentation) Family branding is a policy used for branding all product items under one product line. Example.BRANDING POLICIES If the company has homogeneous products it will be hard to brand them if not at all In case of the branding decision.
Factors that affect the branding policy decision Influenced by the number of products and product lines Characteristics of its target market The number and types of competing products available The size of the company’s resources .
What might be some advantages and disadvantages of such a strategy? .Brand extensions Is when a company introduces a new product item under a product line that is existing.
Kellogg's joined forces with ConAgra to co-brand Kellogg's Healthy Choice cereals Benefits of co-branding 1. Co-branding occurs when two established brand names of different companies are used on the same product. .The combined brands create broader consumer appeal and greater brand equity 3.CO-BRANDING.Co-branding allows companies to enter new markets with minimal risk or investment 2. For example.
free publicity. trademark protection Main disadvantages are a lack of manufacturing control and bombarding consumers with too many unrelated products bearing the same name . Licensor has the right to a royalty fee Royalty fee could be low as 2 percent or higher than 10 percent. The licensee is responsible for all manufacturing.Brand licensing An agreement in which a company permits another organization to use its brand on other products for a licensing fee. selling. and advertising functions The licensee bears the cost if the product fails Main advantages are extra revenues.
what aspects of packaging can help/hinder product sales? How have these products become known by their packaging: •Cracker Jacks? •Capri Sun? Packaging Activity of designing and producing the container or wrapper for a product. Besides its impact on the environment. Tie together elements to support the positioning 30 and marketing strategy.This business-to-business ad offers to provide ecologically sound packaging. . Packaging used to just contain and protect the product. Develop specific elements of the package. Packing now has promotional value and marketers should: Establish a packaging concept.
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