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Chapter 8 modified copy
1.
Chapter 8 -
slide 1Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Chapter Eight Products, Services, and Brands: Building Customer Value
2.
Chapter 8 -
slide 2Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product, Services, and Branding Strategy • What Is a Product? • Product and Services Decisions • Branding Strategy: Building Strong Brands • Services Marketing Topic Outline
3.
Chapter 8 -
slide 3Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Product is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want Service is a form of product that consists of activities, benefits, or satisfaction offered for sale and are essentially intangible and don’t result in the ownership of anything. Experiences represent what buying the product or service will do for the customer Products, Services, and Experiences
4.
Chapter 8 -
slide 4Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall • Product is a key element in the overall market offering. Marketing mix planning begins with formulating the offering that brings value to target customers. This offering becomes the basis upon which the company builds profitable relationship with customers. • A company’s market offering often includes both tangible goods and services. The offer may consist of a pure tangible good, at the other extreme are pure service. Between these 2 extremes, many goods and services combinations are possible.
5.
Chapter 8 -
slide 5Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A ________ is anything that can be offered to a market that might satisfy a need or a want. 1. position 2. product 3. promotion 4. none of the above
6.
Chapter 8 -
slide 6Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A ________ is anything that can be offered to a market that might satisfy a need or a want. 1. position 2. product 3. promotion 4. none of the above
7.
Chapter 8 -
slide 7Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Levels of Product and Services
8.
Chapter 8 -
slide 8Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall •Consumers see products as complex bundles of benefits that satisfy their needs.
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Chapter 8 -
slide 9Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall The most basic level of a product is called its ________. 1. augmented product 2. actual product 3. core benefit 4. position
10.
Chapter 8 -
slide 10Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall The most basic level of a product is called its ________. 1. augmented product 2. actual product 3. core benefit 4. position
11.
Chapter 8 -
slide 11Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Consumer products Industrial products Product and Service Classifications
12.
Chapter 8 -
slide 12Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? • Consumer products are products and services bought by final consumers for personal consumption • Classified by how consumers buy them – Convenience products – Shopping products – Specialty products – Unsought products Product and Service Classifications
13.
Chapter 8 -
slide 13Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Convenience products are consumer products and services that the customer usually buys frequently, immediately, and with a minimum comparison and buying effort • Newspapers • Candy • Fast food Product and Service Classifications
14.
Chapter 8 -
slide 14Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Shopping products are consumer products and services that the customer compares carefully on suitability, quality, price, and style • Furniture • Cars • Appliances Product and Service Classifications
15.
Chapter 8 -
slide 15Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort • Medical services • Designer clothes • High-end electronics Product and Service Classifications
16.
Chapter 8 -
slide 16Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Unsought products are consumer products that the consumer does not know about or knows about but does not normally think of buying • Life insurance • Funeral services • Blood donations Product and Service Classifications
17.
Chapter 8 -
slide 17Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Industrial products are products purchased for further processing or for use in conducting a business • Classified by the purpose for which the product is purchased – Materials and parts – Capital – Raw materials Product and Service Classifications
18.
Chapter 8 -
slide 18Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Types of consumer products include convenience products, shopping products, specialty products, and ________ products. 1. unique 2. luxury 3. unsought 4. all of the above
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Chapter 8 -
slide 19Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Types of consumer products include convenience products, shopping products, specialty products, and ________ products. 1. unique 2. luxury 3. unsought 4. all of the above
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Chapter 8 -
slide 20Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall ________ products are purchased frequently, with little comparison or shopping effort. 1. Convenience 2. Shopping 3. Industrial 4. Unsought
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Chapter 8 -
slide 21Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall ________ products are purchased frequently, with little comparison or shopping effort. 1. Convenience 2. Shopping 3. Industrial 4. Unsought
22.
Chapter 8 -
slide 22Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Consumer product with unique brand identification for which buyers are willing to make a special purchase effort is called _________ product. 1. convenience 2. shopping 3. specialty 4. unsought
23.
Chapter 8 -
slide 23Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Consumer product with unique brand identification for which buyers are willing to make a special purchase effort is called _________ product. 1. convenience 2. shopping 3. specialty 4. unsought
24.
Chapter 8 -
slide 24Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall ________ products are those purchased for further processing or for use in conducting a business. 1. Industrial 2. Shopping 3. Unsought 4. Physical
25.
Chapter 8 -
slide 25Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall ________ products are those purchased for further processing or for use in conducting a business. 1. Industrial 2. Shopping 3. Unsought 4. Physical
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Chapter 8 -
slide 26Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Capital items are industrial products that aid in the buyer’s production or operations Materials and parts include raw materials and manufactured materials and parts usually sold directly to industrial users Supplies and services include operating supplies, repair and maintenance items, and business services Product and Service Classifications
27.
Chapter 8 -
slide 27Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Your visit to a doctor’s office is an example of a ________. 1. pure tangible good 2. pure intangible good 3. unsought product 4. impure tangible good
28.
Chapter 8 -
slide 28Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Your visit to a doctor’s office is an example of a ________. 1. pure tangible good 2. pure intangible good 3. unsought product 4. impure tangible good
29.
Chapter 8 -
slide 29Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? • In addition to tangible products and services, marketers have broadened the concept of a product to include other market offerings; organizations, persons, places and ideas. • Organization marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward an organization.Business firms sponsor public relations or corporate image advertizing campaigns to polish their images and market themselves. Organizations, Persons, Places, and Ideas
30.
Chapter 8 -
slide 30Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product? Person marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular people.sometimes used to build reputation. Organizations, Persons, Places, and Ideas
31.
Chapter 8 -
slide 31Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall What Is a Product Place marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular places or destinations. Ideas can also be marketed. Social marketing is the use of commercial marketing concepts and tools in programs designed to influence individuals’ behavior to improve their well-being and that of society Social marketing goes well beyond the promotional P of the marketing mix to include every other element to achieve its social change objectives. Organizations, Persons, Places, and Ideas
32.
Chapter 8 -
slide 32Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Marketers make product and service decisions at three levels: • Individual product decisions • Product line decisions • product Mix decisions I-Individual Product and Service Decisions
33.
Chapter 8 -
slide 33Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product attributes are the benefits of the product or service • Quality • Features • Style and design Individual Product and Service Decisions
34.
Chapter 8 -
slide 34Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product quality is one of the marketer’s major positioning tools, it includes level and consistency. • Quality level is the level of quality that supports the product’s positioning (TQM) • Conformance quality is the product’s freedom from defects and consistency in delivering a targeted level of performance Individual Product and Service Decisions
35.
Chapter 8 -
slide 35Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall The two dimensions of product quality are ________ and ________. 1. value; features 2. style; design 3. level; consistency 4. style; value
36.
Chapter 8 -
slide 36Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall The two dimensions of product quality are ________ and ________. 1. value; features 2. style; design 3. level; consistency 4. style; value
37.
Chapter 8 -
slide 37Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product features are a competitive tool for differentiating a product from competitors’ products Product features are assessed based on the value to the customer versus the cost to the company Individual Product and Service Decisions
38.
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slide 38Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Style describes the appearance of the product Design contributes to a product’s usefulness as well as to its looks Good design begins with a deep understanding of customer needs.Designers should concentrate on how customers will use and benefit from the product. Individual Product and Service Decisions
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slide 39Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Brand is the name, term, sign, or design—or a combination of these—that identifies the maker or seller of a product or service Brand equity is the differential effect that the brand name has on customer response to the product and its marketing Individual Product and Service Decisions
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slide 40Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall • Branding help Buyers in many ways: – Identify products that might benefit them. – Brands say something about product quality and consistency • Branding help sellers in many ways: – Legal protection for unique product features. – Basis upon which the product’s special qualities are built . – Help in segmenting markets. Building and managing brands are one of the most important tasks of a marketer.
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slide 41Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Packaging involves designing and producing the container or wrapper for a product. Packages nowadays attract attention,describe the product and make the sale. Labels identify the product or brand, describe attributes, and provide promotion. Labels have been affected by unit pricing, open dating and nutritional labeling. Individual Product and Service Decisions
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slide 42Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product support services augment actual products • Survey customers periodically • Assess costs • Develop a package of services that will delight customers and yield profit. • Sophisticated mix of interactive technologies to provide support services. Individual Product and Service Decisions
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slide 43Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A(n) ________ is a name, term, sign, symbol, or combination of these intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. 1. package 2. position 3. image 4. brand
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slide 44Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A(n) ________ is a name, term, sign, symbol, or combination of these intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. 1. package 2. position 3. image 4. brand
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slide 45Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall The designing and producing of the container or wrapper for a product is called ________. 1. packaging 2. labeling 3. manufacturing 4. industrial design
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slide 46Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall The designing and producing of the container or wrapper for a product is called ________. 1. packaging 2. labeling 3. manufacturing 4. industrial design
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slide 47Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product line is a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges II- Product Line Decisions
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slide 48Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product line length is the number of items in the product line • Line stretching ( beyond its current range,downward, upward or both directions) • Line filling (adding more items within the present range of the line) reasons are: extra profits satisfying dealers using excess capacity plugging holes to keep out competitors being the leading full line company. – Product Line Decisions
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slide 49Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A company can lengthen its product line by ________ it or by ________ it. 1. modifying; stretching 2. stretching; switching 3. filling; stretching 4. brushing; combing
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slide 50Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A company can lengthen its product line by ________ it or by ________ it. 1. modifying; stretching 2. stretching; switching 3. filling; stretching 4. brushing; combing
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slide 51Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Product and Service Decisions Product mix consists of all the products and items that a particular seller offers for sale • Width(no. of product lines) • Length(no. of items within a line) • Depth(no. of versions of each product) • Consistency(how are product lines closely related in end use) III- Product Mix Decisions
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slide 52Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Which of the following is not a dimension in a company’s product mix? 1. Width 2. Depth 3. Consistency 4. Age
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slide 53Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Which of the following is not a dimension in a company’s product mix? 1. Width 2. Depth 3. Consistency 4. Age
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slide 54Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Brand represents the consumer’s perceptions and feelings about a product and its performance. It is the company’s promise to deliver a specific set of features, benefits, services, and experiences consistently to the buyers 1- Brand equity: the positive differential effect that knowing the brand name has on customer response to the product or service. Branding Strategy: Building Strong Brands
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slide 55Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall • High brand equity provides a company with many competitive advantages: – High level of consumer brand awareness and loyalty. – More leverage in bargaining with resellers – High credibility – The company can easily launch line and brand extensions. – Defence against fierce competition – Basis for building strong and profitable customer relationships.
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slide 56Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Branding Strategy: 2- Building Strong Brands Brand strategy decisions include: • Product attributes • Product benefits • Product beliefs and values Establish a mission for the brand and a vision for what the brand must be and do. A brand is the company’s promise to deliver a specific set of features, benefits, services and experiences consistently to buyers. The promise must be simple and honest. A-Brand Positioning
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slide 57Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Branding Strategy: Building Strong Brands Begins with: A careful review of the product and its benefits, the target market and proposed market strategies. *Desirable qualities 1. Suggest benefits and qualities 2. Easy to pronounce, recognize, and remember 3. Distinctive 4. Extendable 5. Translatable for the global economy 6. Capable of registration and legal protection. Once chosen, the brand name must be protected. B- Brand Name Selection
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slide 58Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Branding Strategy: Building Strong Brands Manufacturer’s brand Private brand (hard to establish,costly to stock and promote but yield high profit margins.) Licensed brand (celebrities and characters) Co-brand ( advantages and disadvantages) C- Brand Sponsorship
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slide 59Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Branding Strategy: Building Strong Brands D- Brand Development Strategies
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slide 60Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall a. Line extension – occurs when a company extends existing brand names to new forms, colors, sizes, ingredients or flavors of an existing product category. Ex. Creamsilk – hair full, glossy shine, …etc.
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slide 61Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall b. Brand extension – extends a current brand name to new or modified products in a new category/categories. Ex. Huggies brand from disposable diapers to a full line of toiletries, such as huggies shamppos, lotions, baby wash, disposable changing pads
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slide 62Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall c. Multibranding – offers a way to establish diiferent features and appeal to different buying motives. Ex. Procter & Gamble markets many brands in each of its product categories. d. New brand – create a new brand name when it enters a new product category.
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slide 63Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A good brand name should do which of the following? 1. Suggest something about the product’s benefits 2. Be easy to translate into other languages 3. Be capable of registration and legal protection 4. All of the above
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slide 64Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A good brand name should do which of the following? 1. Suggest something about the product’s benefits 2. Be easy to translate into other languages 3. Be capable of registration and legal protection 4. All of the above
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slide 65Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A ________ brand is created by a reseller of a product or service. 1. private 2. tangible 3. value 4. shopping
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slide 66Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall A ________ brand is created by a reseller of a product or service. 1. private 2. tangible 3. value 4. shopping
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slide 67Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Purina Tuna would be a poor attempt at a ________. 1. specialty good 2. brand extension 3. multibrand 4. new brand
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slide 68Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Purina Tuna would be a poor attempt at a ________. 1. specialty good 2. brand extension 3. multibrand 4. new brand
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slide 69Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing • Government • Private not-for-profit organizations • Business services Types of Service Industries
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slide 70Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Nature and Characteristics of a Service
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slide 71Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Which of the following is not a special characteristic of service? 1. Tangibility 2. Inseparability 3. Variability 4. Perishability
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slide 72Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Which of the following is not a special characteristic of service? 1. Tangibility 2. Inseparability 3. Variability 4. Perishability
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slide 73Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing In addition to traditional marketing strategies, service firms often require additional strategies • Service-profit chain • Internal marketing • Interactive marketing Marketing Strategies for Service Firms
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slide 74Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Service-profit chain links service firm profits with employee and customer satisfaction • Internal service quality • Satisfied and productive service employees • Greater service value • Satisfied and loyal customers • Healthy service profits and growth Marketing Strategies for Service Firms
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slide 75Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Internal marketing means that the service firm must orient and motivate its customer contact employees and supporting service people to work as a team to provide customer satisfaction Internal marketing must precede external marketing Marketing Strategies for Service Firms
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slide 76Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Interactive marketing means that service quality depends heavily on the quality of the buyer-seller interaction during the service encounter • Service differentiation ( offer, delivery and image) • Service quality • Service productivity Marketing Strategies for Service Firms
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slide 77Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Managing service differentiation creates a competitive advantage from the offer, delivery, and image of the service • Offer can include distinctive features • Delivery can include more able and reliable customer contact people, environment, or process • Image can include symbols and branding Marketing Strategies for Service Firms
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slide 78Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Managing service quality provides a competitive advantage by delivering consistently higher quality than its competitors Service quality always varies depending on interactions between employees and customers Marketing Strategies for Service Firms
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slide 79Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Services Marketing Managing service productivity refers to the cost side of marketing strategies for service firms • Employee recruiting, hiring, and training strategies • Service quantity and quality strategies Marketing Strategies for Service Firms
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slide 80Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
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