THE PRODUCT

 Products are almost always combinations

of the tangible and intangible. The entire
package is sometimes referred to as the
augmented product.
 A product is anything that can be offered to a
market to satisfy a want or need, including
physical goods, services, experiences,
events, persons, places, properties,
organizations, information, and ideas.
 COMPONENTS OF THE MARKET
OFFERING

Value based pricing

Attractiveness of the
market offering

Product features and Services mix and

quality quality
 FIVE LEVELS OF THE PRODUCT

(5) Potential (1) Core

Product
Product
(2) Basic
Product

(3) Expected
(4) Augmented Product
Product
 FIVE LEVELS OF THE PRODUCT

 (1) Core Product / Core Benefit : The

fundamental service or benefit that the
customer is really buying.
 (2) Basic Product : At the same level, the
marketer has to turn the core benefit into a
basic product.
 (3) Expected Product : A set of attributes
and conditions buyers normally expect
when they purchase this product.
FIVE LEVELS OF THE PRODUCT

 (4) Augmented Product : The marketer

prepares an augmented product that
exceeds customer expectations.
 (5) Potential Product : encompasses all the
possible augmentations and
transformations the product might undergo
in the future. Companies search for new
ways to satisfy customers and distinguish
their offer.
 PRODUCT DIFFERENTIATION
The challenge before the product marketers is to create
relevant and distinctive product differentiation. The product
differentiation may be based on :
 Physical Differences ( eg., features, performance, conformance,
durability, reliability, design, style, packaging )
 Availability Differences ( eg., available from stores or orderable
by phone, mail, fax, internet )
 Service Differences ( eg., delivery, installation, training,
consulting, maintenance, repair )
 Price Differences ( eg., very high price, medium price, low price,
very low price )
 Image Differences ( eg., symbols, atmosphere, events, media )
 PRODUCT CLASSIFICATION

1. Basis of nature of the product: - 1. Non

Durable, 2. Semi Durable, 3. Durable and 4. Service
2. Basis of Customer Shopping Habits
1. CONVENIENCE, 2. SHOPPING 3. SPECIALITY and
4. UN SOUGHT GOODS.
3. Basis of Process of Consumption:
1. Consumer Goods 2. Industrial Goods
4. Basis of Operations:
1. Local 2. National, 3. International 4. Global
Convenience Products
Buy frequently & immediately
> Low priced
> Many purchase locations
> Includes:
• Staple goods
• Impulse goods
• Emergency goods
Shopping Products
Buy less frequently
> Gather product information
> Fewer purchase locations
> Compare for:
• Suitability & Quality
• Price & Style

Specialty Products Unsought Products

Special purchase efforts
> Unique characteristics
> Brand identification
> Few purchase locations
New innovations
> Products consumers don’t
want to think about.
>Require much advertising &
personal selling
PRODUCT MIX

 A product mix (also called product

assortment) is the set of all products and
items that a particular seller offers for
sale.
 A total group of products that an
organization markets.
 A company’s product mix has a certain width,
length, depth and consistency.
 Product Mix – Godraj
Product Mix – Godrej
 Consumer products

1. Appliances 
2. Locks
3. Furniture
4. Security Equipment 
5. Office Automation 
6. Conferencing Solutions 
7. Typewriters
8. Vending Machines Product Mix
9. Soaps & Personal care  
10. Foods
11. Cosmetics
12. Household Insecticides 
13. Housing
14. Pest Management Services
Product Mix Dimensions
Product Mix of Videocon.
DIMENSIONS OF PRODUCT MIX

 The width of company’s (say HLL’s) product mix

refers to how many different product lines the
company carries, such as bathing soap, detergents,
shampoos, toothpaste, food products.
 The length of a company’s product mix refers to the
total number of items in its product Line. Thus in
each of the product line HLL has a number of product
items. Eg., in the product line of bathing soaps, HLL
has several product items like Lux, Liril, Lifebuoy,
Pears.
DIMENSIONS OF PRODUCT MIX

 The depth of a company’s product mix refers to how

many variants are offered of each product in the
line. Thus if close up toothpaste comes in three
formulations and in three sizes, Close up has a depth of
nine (3x3). The average depth of HLL product mix can
be calculated by averaging the number of variants
within the brand groups.
 The Consistency of the product mix refers to how
closely related the various product lines are in end-
use, production requirements, distribution
channels, or some other way. HLL’s product lines are
consistent in so far as they are consumer goods that go
through the same distribution channels.
Product Hierarchy:
Need Family:
Core need that underlines the existing of a product family.
Example: Feel good/Look good.
Product Family:
All product classes that satisfy a core need with reasonable
effectiveness.
Example: Toiletries.
Product Class:
Group of products within product family recognized to
have certain functional coherence.
Example: Cosmetics.
Product Line:
Group of products within product class that are closely
related because:
They perform similar functions.
They are sold to same customer group.
They are marketed through same channels.
They fall within given price range.
Example: Lipstick.
Product Hierarchy:

Product Type:
Group of items within a product line that share one of
several possible forms of product.
Example: Tube lipstick.

Brand:
Name associated with one/ more items in the product line
that is used to identify the source/ characteristics of items.
Example: Lakme.

Variant/ Stock Keeping Unit (SKU):

Distinct unit within a brand/product line that is
distinguishable by size/ price/ appearance/ other attribute
Example: Frosted lipstick (pink)
DIMENSIONS OF PRODUCT MIX

 These four dimensions of the product mix

provide the handles for defining the company’s
product strategy. The company can expand its
business in four ways.
 1. The Co. can add new product lines, thus
widening its product mix.
 2. The Co. can lengthen each product line.
 3. The Co. can add more product variants to each
product and deepen its product mix.
 4. The Co. can pursue more product-line
consistency or less, depending upon whether it
wants to acquire a strong reputation in a single
field or participate in several fields.
PRODUCT LINE

 A product line is a homogeneous group of

products that are closely related, because
they perform a similar function, are sold to
the same customer groups, are marketed
through the same channels or fall within the
given price ranges.

 The product mix may be composed of

several product lines.
List of product Line IN HUL
Personal care
Oral care
Skin care
Fabric wash
Hair care
House hold care
Oil & edible fats
Seeds & fertilizers
Beverages
Ice creams
 PRODUCT PORTFOLIO MANAGEMENT

 Product Line Length :

. Downward Line Stretching
. Upward Line Stretching
. Two Way Stretching
High Present New
New
Product
Price Present
New Present
Product New
Low
Low High
Quality

(Downward) (Upward) (Two Way)

DEFINITION OF BRAND

 American Management Association

defines brand as follows :
“ A brand is a name, term, sign, symbol, or
design, or a combination of them,
intended to identify the goods and
services of one seller or group of sellers
and to differentiate them from those of
competitors. ”
BRAND NAME DECISIONS

 Individual Names LUX, Ariel etc.,

 Blanket Family Names BPL, SONY,

SAMSUNG, HP, TATA, HONDA etc.,

 Company Trade name combined with

individual product names. TATA NANO

 http://brandyuva.in/2017/02/30-top-indian-fmcg-company-logos.html
 BRAND IDENTITY AND ASSOCIATION

 A brand identity or association is anything that

is directly or indirectly linked in memory to
a brand. The most common association is that
of product attributes or customer benefits.

 A brand’s associations are assets that can

differentiate, provide reasons to buy, instil
confidence and trust, affect feelings
towards a product and the use experience,
and provide the basis for brand extension.
 BRAND LOYALTY

 First, brand loyalty reduces the marketing costs of

doing business, since existing customers are relatively
easier to hold.
 Second, brand loyalty represents a substantial barrier
to competitors. Excessive resources are required when
entering a market in which existing customers must be
enticed away from an established brand that they are
loyal to.
 Third, Brand loyalty provides trade leverage.
 Fourth, a relatively large, satisfied customer base
provides an image of a brand as an accepted,
successful, and enduring product.
 Finally, brand loyalty provides the time to respond to
competitive moves.
DEFINITION OF BRAND EQUITY

 Brand equity is a set of assets and

liabilities linked to a brand’s name and
symbol that add to or substract from the
value provided by a producer or service to
a firm and / or that firm’s customers.
 Brand equity generates value to the
customer that can emerge either as a price
premium or enhanced brand loyalty.
BRAND EQUITY

Brand Brand
Awareness Identity
Brand
Equity
Perceived Brand
Quality Loyalty

( Powerful brands have high brand

equity, higher brand loyalty.)
 PRODUCT LIFE CYCLE

 The Product Life Cycle ( PLC ) is an

important concept in marketing that
provides insights into a product’s
competitive dynamics.
 To fully understand the concepts of PLC ,
one should first understand its parent
concept, the demand and technology life
cycles.
 Three special categories of PLC

1. Styles appear in homes, clothing, art etc.

2. A Fashion is a currently accepted or popular style in a given field. Fashion
pass through four stages: Distinctiveness, imitation, mass fashion, decline
3. Fads are fashions that comes quickly into public view , are adopted with
great zeal, peak early, and decline very fast.
Style, Fashion and Fad categories of
PLC
PRODUCT LIFE CYCLES - Graph
Stages in the Product Life Cycle

Monopoly Monopolistic Oligopoly Pure Competition

 PLC : Introduction Stage
Sales
Sales Low
Low

Costs
Costs High
High cost
cost per
per customer
customer

Profits
Profits Negative/
Negative/ V.
V. Low
Low

Marketing
Marketing Objectives
Objectives Create
Create product
product awareness
awareness and
and trial
trial

Product
Product Offer
Offer aa basic
basic product
product

Price
Price Use
Use cost-plus
cost-plus formula
formula

Distribution
Distribution Build
Build selective
selective distribution
distribution

Promotion
Promotion Heavy
Heavy to
to entice
entice product
product trial
trial
 PLC : Growth Stage

Sales
Sales Rapidly
Rapidly rising
rising

Costs
Costs Average
Average cost
cost per
per customer
customer

Profits
Profits Rising
Rising

Marketing
Marketing Objectives
Objectives Maximize
Maximize market
market share
share

Product
Product Offer
Offer extension,
extension, service,
service, warranty
warranty

Price
Price Penetration
Penetration strategy
strategy

Distribution
Distribution Build
Build intensive
intensive distribution
distribution

Promotion
Promotion Reduce
Reduce to
to take
take advantage
advantage of
of demand
demand
 PLC : Maturity Stage
Sales
Sales Peak
Peak

Costs
Costs Low
Low cost
cost per
per customer
customer

Profits
Profits High
High

Marketing
Marketing Objectives
Objectives Maximize
Maximize profits
profits while
while defending
defending market
market share
share

Product
Product Diversify
Diversify brand
brand and
and models
models

Price
Price Match
Match or
or best
best competitors
competitors

Distribution
Distribution Build
Build more
more intensive
intensive distribution
distribution

Promotion
Promotion Increase
Increase to
to encourage
encourage brand
brand switching
switching
 PLC: Decline Stage
Sales
Sales Declining
Declining

Costs
Costs Low
Low cost
cost per
per customer
customer

Profits
Profits Declining
Declining

Marketing
Marketing Objectives
Objectives Reduce
Reduce expenditures
expenditures and
and milk
milk the
the brand
brand

Product
Product Phase
Phase out
out weak
weak items
items

Price
Price Cut
Cut price
price

Distribution
Distribution Selective:
Selective: phase
phase out
out unprofitable
unprofitable outlets
outlets

Promotion
Promotion Reduce
Reduce to
to minimum
minimum level
level
NEW PRODUCT DEVELOPMENT PROCESS

 (1) Idea Generation

 (2) Screening
 (3) Concept Development and Testing
 (4) Marketing Strategy
 (5) Business Analysis
 (6) Product Development
 (7) Market Testing
 (8) Commercialization
 Marketing
Strategy Business
Development Analysis

Concept Product
Development Development
and Testing

Idea Market
Screening Testing

Idea
Generation Commercialization