Products, Services, and Brands: Building Customer
Value
Product
Anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a want or need.
Broadly defined, "products" also include services, events, persons, places,
organizations, ideas or mixes of these.
Services
Any activity or benefit that one party can offer to another that is essentially
intangible and does not result in the ownership of anything.
Products, Services, and Experiences
Product is a key element in the overall market offering.
A company's market offering often includes both goods and services. (pure tangible,
pure intangible or in between)
As products and services become commoditized, in order to differentiate,
companies are creating and managing customer experiences with their brands and
company.
Levels of products and services
Core
Actual
Augmented
Consumer products
Products and services brought by final consumers for personal consumption.
Industrial Product
Product brought by individuals and organizations for further processing or for use
in conducting a business.
Organizations, Persons, Places and Ideas
Organizations often carry out activities to "sell" the organization itself.
Both profit and not-for-profit organizations practice organization marketing.
They use public relation or corporate image advertising to market themselves and
polish their image.
Place marketing involves activities undertaken to create, maintain or change
attitudes or behavior towards particular places.
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Ideas can also be marketed. (social Ideas)
Social Marketing: The use of commercial marketing concepts and tools in
programs designed to influence individuals' behavior to improve their well-being
and that of society.
Individual Product Decisions
1. Product Attributes
a. Product Quality
The characteristics of a product or service that bear on its ability to satisfy stated or
implied customer needs.
Quality is when our customers come back, and our products don't.
Performance Quality: The ability of a product to perform its functions.
Conformance Quality: Freedom from defects and consistency in delivering a
targeted level of performance.
b. Product Features
Features are competitive tool.
Stripped-down model with no extra or dressed-up model with many extras.
c. Product Style and Design
Style simply describes the appearance of a product.
Design is more than skin deep - it goes to the very heart of a product.
Good design contributes to a product's usefulness as well as to its looks.
2. Branding
Today hardly anything goes unbranded.
A name, term, sign, symbol, design, or a combination of these that identifies the
products or services of one seller or group of sellers and differentiates them from
those of competitors.
Brand name help consumers identify products.
Brands say something about product quality and consistency.
Seller's brand name and trademark provides legal protection.
Branding helps seller to segment the market.
3. Packaging
The activities of designing and producing the container or wrapper of a product.
Traditionally, primary purpose of packaging was to hold and protect the
product.
For increased competition, packaging today perform many functions - from
attracting attention, to describing the product, to making the sale.
Innovative packaging can give a company an advantage over competitors and boost
sales.
"Green" packaging - using environmentally responsible packaging materials.
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4. Labeling
Simple tags attached to products to complex graphics that are part of the package.
It identifies the product or brand.
It describes several things about the product.
It helps to promote the brand, support its positioning, and connect with
customers.
Along with the positives, labeling also raise legal concerns.
Today labeling must contain unit pricing, open dating and nutritional labeling.
5. Product Support Service
A company's offer usually includes some support services, which can be a minor or
major part of the total offering.
Many companies are now using a sophisticated mix of phone, email, fax, internet
and interactive voice and data technologies to provide support services that were
not possible before.
Product Line Decisions
Product line: 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.
Product line length is influenced by company objectives and resources.
Product Line Filling: Adding more item within the present range of the line.
Reasons:
Reaching for extra profit.
Satisfying dealers.
Using excess capacity.
Being the leading full-line company.
Plugging holes to keep out competitors.
Product line stretching: occurs when a company lengthens its product line
beyond its current range.
Stretching Downward: Companies located at the upper end of the market can
stretch their lines downward.
Reasons:
To plug a market hole that otherwise would attract a new competitor.
To respond to a competitor's attack on the upper end.
To enjoy the faster growth segment at the low end segment.
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Stretching Upward
Reasons:
To add prestige to the current products.
To enjoy the higher growth rate or higher margin at the higher end.
Stretching in both directions
Product Mix Decisions
Product Mix (or Product Portfolio): The set of all product lines and items that
a particular seller offers for sale.
Four Dimensions
Length
Width
Depth
Consistency
Brand Equity
The differential effect that knowing the brand name has on customer response to
the product or its marketing.
Four pillars of Brand equity
Differentiation
Relevance
Knowledge
Esteem
Major Brand Strategy Decisions
1. Brand Positioning
Attributes are the least desirable level for brand positioning.
Competitors can easily copy attributes.
Customers are not interested about attributes; they are more interested in
what the attributes will do for them.
A brand can be better positioned by associating its name with a desirable benefit.
Strongest brands focused on strong beliefs and values.
These brands pack on emotional wallop.
2. Brand name selection
It should suggest something about the product's benefits and qualities.
It should be easy to pronounce, recognize and remember.
It should be distinctive.
It should be extendable.
It should translate easily into foreign language.
It should be capable of registration and legal protection.
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Generic Names
3. Brand Sponsorship
Four Brand Sponsorship options for manufacturer.
Manufacturer's or National Brand
Private Brand
Licensing
Co-Branding
4. Brand Development
Line Extension
Brand Extension
Multibrands
New Brands
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