MARKETING I
Principles of Marketing
Instructor: Mrs. Marielou Cruz Manglicmot,MBA Reporters: Jhonly Banconian Rowel Montao Marjorie Hangad
PRODUCT
Are the vehicles by which the company attempts to accomplish its objectives Is anything offered for sale by a firm to buyers to satisfy their wants and needs
Product may
A physical object A service A place An organization An idea A personality
To maintain the interest of buyers, the physical products are most often provided with benefits like
Quality Reputation of the manufacturer Packaging Credit Information about the product Warranty After sales services Delivery
With the foregoing statement, a product may now be defined more specifically, as follows:
A product is anything offered for sale by a firm to buyers to satisfy their physical, social, symbolic, and psychological wants and needs.
Classification of Product
Consumer goods Industrial goods
Consumer goods Are those intended for final consumption by consumers
The rate of consumption
and tangibility The consumers shopping habit
Rate of consumption and tangibility
Durables Nondurables Services
Durable goods Are tangible goods which normally
survive many uses
Nondurable goods Are tangible products which are
consumed in one or few uses
Services Are intangible goods like activities,
benefits, or satisfaction which are offered for sale
Consumers Shopping Habit
Convenience goods Shopping goods Specialty goods Unsought goods
Convenience goods Are those which are purchased with
a minimum of effort Shopping goods Are those that bought only after an effort to compare with other goods is made Specialty goods Are those that the consumers seek to buy and they are not willing or they are not able to accept substitutes
Unsought goods Are those that are not yet wanted by
or are still unknown to the consumer
The new unsought goods The regularly unsought goods
New Unsought Goods Are really new ideas or
products that the consumers still have to know to be motivated to buy Regular Unsought Goods Are those that stay unsought but not unbought forever
Industrial goods
Are those used in the
production of other goods
Installations Accessory Equipment Raw Materials Component Parts and
Materials Supplies Services
Installations
Refers to industrial products
with long life, are generally expensive, and they form part of the major capital equipment of an industrial firm
Accessory Equipment are industrial goods that are
used as aids in the production process
Raw Materials
are unprocessed goods that will
become part of another product farm products are those grown by farmers natural products are those which occur by nature
Component Parts and Materials Are processed industrial goods
that will still be used and become an actual part of the finished product
Supplies
Are items that are used as aids in the
operating process but do not become part of the finished product
Services
Are expense items that assist in the
operation
Branding Quality Image Product features Packaging Location Promotion Innovation Different service
The Product as a More Useful Variables
Branding
A marketing action which identifies and helps differentiate the goods or services of one seller from those of another
Brand
Is a name, term, sign, symbol, or design, or a combination of these elements, that is intended to identify the goods or services of one seller or a group of sellers
Legally registered Not legally registered
Legally registered brands are provided with legal protection called trademark
Brand name
Refers to that part of a brand consisting of words, letters, and/or numbers that can be vocalized
Brand mark
Refers to that part of a brand that appears in the form of a symbol, design, or distinctive coloring or lettering, and which can not be vocalized
Licensing as an Alternative
Licensing offers much flexibility because the licensee is not barred from using other options when needed
Criteria for a Good Brand
Desirable qualities of a Good Brand
It should suggest something about the products benefits and qualities It should be easy to pronounce, recognize, spell, and remember It should be distinctive It must be adaptable to additional product lines It must be capable of being legally registered
When to adapt a brand
The demand for the general product class which the product or service under consideration belongs should be large The demand should be strong enough so that the market price can be high enough to make the effort profitable There should be economies scale The product quality should be the best for the price, and the quality should be easy to maintain
The brand or trademark should make it easy for the product to be identified Availability of the product is the dependable and widespread Favorable shelf location or display space in stores must be available for retailing activities
BRANDING STRATEGIES
Manufacturer Branding Reseller branding Mixed branding Generic branding
Manufacturer branding
is a branding strategy in which the brandname for a product is designated by the manufacturer.
Multiproduct approach Multibrand approach
Multiproduct approach
Referred to as blanket or family branding strategy, uses the same brand name to cover a group of products
Advantages
Buyers who have a positive experience with the product will extend this favorable attitude to other products with the same brand The level of brand awareness is raised and can reduce the rate of advertising costs
Multibrand approach
Requires the firm to provide each product with a distinctive name
Advantages It is useful when each brand is intended for a different marketing segment There is no risk of one products failure affecting another product line
Reseller branding
Refers to the branding strategy of a firm which manufactures products but sell them under the brand name of a reseller Also referred to as a private labeling or private branding
Mixed branding
Refers to the use of the manufacturer and reseller brands in a product
Generic branding
A branding strategy which lists no product name, only a description of contents
Packaging
Refers
to all activities involved in designing and producing the container or wrapper for a product The container or wrapper is the package
Three level of materials
The
primary package which is the products immediate container The secondary package which protects the primary package The shipping package which contains the secondary package or the packages
Reasons for packaging
It
provides protection to products before and after they are in the possession of the intended users It provides convenience to the users It provides safety It provides economy to both the seller and the user It allows sellers to effectively promote the product
What Makes a Good Package?
Labeling
Label
Part of the product which provides information about the product and the manufacturer It may be A part of the package A tag attached to the product
Types of label
The The The The
brand label descriptive label grade of label promotional label
PRODUCT WARRANTY
One of the product components that attract customers to patronize a product is the warranty, which is a statement explaining what the seller promises about the product. It is actually manufacturers written promise as to the extent of the repair, replacement, or otherwise compensation for detective goods.
Variations of Warranty
Express Implied
Express
are
Warranties
written statement of a manufacturer s liabilities for product deficiencies.
Express warranty may be:
limited-coverage limited
warranty
full warranty
warranty is a manufacturer s statement indicating the bounds of coverage and noncoverage of any deficiency found in the product
full
limited-coverage limited-
warranty
is a statement of liability by a manufacturer that has no limits of coverage.
warranties are those that assign responsibility for product deficiencies to a manufacturer even if the item was sold by a retailer.
Implied
PRODUCT LIFE CYCLES
PLC refers to a products sales growth from the beginning to is peak, followed by a decline and its eventual withdrawal from the market.
STAGES
INTRODUCTION GROWTH MATURITY DECLINE
Various forces affecting the life cycle
Consumer demand Competition Government rulings
The Introduction Stage
slow growth of sales heavy promotion expenditures in the relation of sales relatively high prices for product limited product offering like limited variations in sizes, color, and the like
The slow sales growth is attributed to the ff.
delays in the expansion of production capacity technical product problems that have to be worked out difficulty in gaining widespread distribution inertia on the part of costumer in trying the new product.
Heavy promotional expenditures are attributed
heavy sales cost involved in obtaining distribution the need for heavy advertising to create consumer awareness and trial
High prices are caused by The need to recover investment cost in plant and equipment low volumes of sales
Limited product offering are the caused by insufficiency of initial sales volume to justify variations in the product.
sales start climbing rapidly as distribution increases and the costumer are persuaded to try the product. the ratio of promotion expenditures to sales decreased. This is due the rapid increase in sale but without a corresponding increase in promotion expense. prices tend to remain high except when demand stimulation is required and entry of competitors is discouraged. new forms of the product appear, like new colors, new models, new sizes.
The growth stage
The maturity stage
sales settle down as the
product becomes well-known well price reduction are used as a tool of competition competition s intensified the market becomes saturated
The decline stage
a pruning of production
models an variations to eliminate those not producing profit promotion expense are reduced plans for phasing out the product made
The Importance of the Product Life Cycle Concept
It provides him with a guide in
adapting appropriate marketing strategies Knowledge of the PLC concept may be useful in many aspects of decisiondecision-making in marketing
