Principles of Marketing
Seventeenth Edition
Chapter 8
Products, Services, and Brands:
Building Customer Value
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Learning Objectives
8-1 Define product and describe the major classifications of products and
services.
8-2 Describe the decisions companies make regarding their individual
products and services, product lines, and product mixes.
8-3 Identify the four characteristics that affect the marketing of services and
the additional marketing considerations that services require.
8-4 Discuss branding strategy—the decisions companies make in building and
managing their brands.
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Learning Objective 1
Define product and describe the major classifications of products
and services.
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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 product that consists of activities, benefits, or satisfactions and
that is essentially intangible and does not result in the ownership of
anything.
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What Is a Product?
Products, Services, and Experiences
Products and services are becoming more commoditized.
Companies are now creating and managing customer experiences with
their brands or company.
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What Is a Product?
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What Is a Product?
Product and Service Classifications
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What Is a Product?
Product and Service Classifications
Consumer products
Industrial products
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What is a Product?
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What is a Product?
Product and Service Classifications
Consumer products are products and services bought by final consumers
for personal consumption.
• Convenience products
• Shopping products
• Specialty products
• Unsought products
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What Is a Product?
Product and Service Classifications
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
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What Is a Product?
Product and Service Classifications
Shopping products are less frequently purchased consumer products
and services that the customer compares carefully on suitability, quality,
price, and style.
• Furniture
• Cars
• Appliances
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What Is a Product?
Product and Service Classifications
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
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What Is a Product?
Product and Service Classifications
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
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What Is a Product?
Product and Service Classifications
Industrial products are those products purchased for further processing or
for use in conducting a business.
• Materials and parts
• Capital items
• Supplies and services
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What Is a Product?
Product and Service Classifications
Materials and parts include raw materials and manufactured materials and parts.
Capital items are industrial products that aid in the buyer’s production or
operations.
Supplies and services include operating supplies, repair and maintenance
items, and business services.
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What Is a Product?
Product and Service Classifications
Organizations, Persons,
Places, and Ideas
• Organization marketing
• Person marketing
• Place marketing
• Social marketing
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What Is a Product?
Product and Service Classifications
Organization marketing consists of activities undertaken to create, maintain,
or change the attitudes and behavior of target consumers toward an
organization.
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What Is a Product?
Product and Service Classifications
Person marketing consists of activities undertaken to create, maintain, or
change the attitudes or behavior of target consumers toward particular
people.
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What Is a Product?
Product and Service Classifications
Place marketing consists of activities undertaken to create, maintain, or
change attitudes and behavior toward particular places.
Social marketing uses commercial marketing concepts to influence
individuals’ behavior to improve their well-being and that of society.
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Learning Objective 2
Describe the decisions companies make regarding their individual products
and services, product lines, and product mixes.
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Product and Service Decisions
Figure 8.2 Individual Product Decisions
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Product and Service Decisions
Individual Product and Service Decisions
Communicate and deliver benefits by product and service attributes.
• Quality
• Features
• Style and design
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Product and Service Decisions
Individual Product and Service Decisions
Product quality refers to the characteristics of a
product or service that bear on its ability to satisfy
stated or implied customer needs.
• Total quality management
• Return-on-quality
• Quality level
• Performance quality
• Conformance quality
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Product and Service Decisions
Individual Product and Service Decisions
Product Features
• Competitive tool for differentiating a product from competitors’ products
• Assessed based on the value to the customer versus its cost to the
company
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Product and Service Decisions
Individual Product and Service Decisions
Style describes the appearance of the product.
Design contributes to a product’s usefulness as well as to its looks.
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Product and Service Decisions
Individual 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.
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Product and Service Decisions
Individual Product and Service Decisions
Packaging involves designing and producing
the container or wrapper for a product.
Labels identify the product or brand, describe
attributes, and provide promotion.
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Product and Service Decisions
Individual Product and Service Decisions
Product support services augment actual
products.
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Product and Service Decisions
Product Line 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.
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Product and Service Decisions
Product Line Decisions
Product line length is the number of
items in the product line.
• Line stretching
• Line filling
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Product and Service Decisions
Product Mix Decisions
Product mix consists of all the
product lines and items that a
particular seller offers for sale.
• Width
• Length
• Depth
• Consistency
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Learning Objective 3
Identify the four characteristics that affect the marketing of services and the
additional marketing considerations that services require.
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Services Marketing
Types of Service Industries
• Government
• Private not-for-profit
organizations
• Business organizations
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Services Marketing
Figure 8.3 Four Service Characteristics
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Services Marketing
Marketing Strategies for Service Firms
In addition to traditional marketing strategies, service
firms often require additional strategies.
• Service-profit chain
• Internal marketing
• Interactive marketing
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Services Marketing
Marketing Strategies for Service Firms
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
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Services Marketing
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Services Marketing
Marketing Strategies for Service Firms
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.
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Services Marketing
Marketing Strategies for Service Firms
Interactive marketing means that service quality depends heavily
on the quality of the buyer-seller interaction during the service
encounter.
• Service differentiation
• Service quality
• Service productivity
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Services Marketing
Marketing Strategies for Service Firms
Managing service differentiation creates a
competitive advantage.
• Offer
• Delivery
• Image
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Services Marketing
Marketing Strategies for Service Firms
Managing service quality enables a service firm to differentiate itself by
delivering consistently higher quality than its competitors provide.
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