Product and Brand Management

Module 1
 Topics
• Introduction to Product- Meaning &
Classification
• Product Management – Definition, Scope and
Importance
• Role of Product Manager
• Challenges affecting Product Management
• Product Mix and Line Decisions – Managing
Line Extensions
 What is a Product?
• A product is any offering by a company to a market
that serves to satisfy customer needs and wants.
• Includes:
– Physical Products
– Services
– Persons
– Places
– Organizations
– Ideas
– Combinations of the above
 Features of a Product

Tangibility
Associated
attributes
Intangible
Features of attributes
product

Exchange Customer
value satisfaction
 Levels of Product

Unexpected features Potential product

Luxury features Augmented product

Expected features Expected product

Basic features
Generic product

Basic benefit Core product

 Core
Core Actual
Actual
Product
Product Product
Product
Warranty
Quality
Design
Level
Service
Service
After- or
Delivery
or
Sale Benefit
& Credit
Benefit
Service Core
Core
Brand
Features Name
Packaging
Installation
Augmented
Augmented
Product
Product
Levels of Product
 Classification of Products
• Consumer products
• Business products
 Classification of Products
• Consumer Products
– Convenience
– Shopping
– Unsought
– Specialty
 Classification of Products
• Convenience Products:
– Buy frequently & immediately
– Low priced
– Many purchase locations
– Includes:
• Staple goods
• Impulse goods
• Emergency goods
 Classification of Products
• Shopping Products:
– Buy less frequently
– Gather product information
– Fewer purchase locations
– Compare for:
• Suitability & Quality
• Price & Style
 Classification of Products
• Unsought Products:
– New innovations
– Products consumers don’t want to think about.
– Require much advertising & personal selling
 Classification of Products
• Specialty Products:
– Special purchase efforts
– Unique characteristics
– Brand identification
– Few purchase locations
 Business Products
• Materials and parts
– Raw materials and parts
– Manufactured materials and parts

• Capitals items
– Installation
– Equipment

• Suppliers and business services

– Maintenance and repair items
– Operating suppliers
 Marketing Mix and Product Management

PRODUCT CLASSIFICATION
A. Durability and tangibility
- Nondurable goods.
- Durable goods
- Services.
B.  Consumer –goods classification
- Convenience good.
- Shopping goods
- Speciality goods
- Unsought goods.
PRODUCT 14
 Marketing Mix and Product Management

A. Durability & Tangibility

1. Non-durable goods
- Consumed in one or few uses
- Consumed quickly
- Frequent purchase
- Need to make them available in many locations
- Heavy promotion
- Induce trial
Example
Coke, Modern bread, Lux Soap, Mother Diary Milk

PRODUCT 15
 Marketing Mix and Product Management

2. Durable goods
- Used many times
- More personal selling/service
- Seller’s assurance about product longevity
Example
- Refrigerators
- Mixer
- Car
• Higher priced than non-durable
• Consumer involvement is high as they are high
priced

PRODUCT 16
 Marketing Mix and Product Management

3. Services
- Intangible
- Inseparable
- Variable
- Perishable
Example
- Beauty parlour
- Education Services
- A Surgery
- Listening to concert
- Airlines
PRODUCT 17
 Marketing Mix and Product Management

Therefore
• Products which are predominantly tangible
are called goods
• Products, which are predominantly
intangible, are called services.

PRODUCT 18
 Marketing Mix and Product Management
B. Consumer – Goods classification
Based on shopping habits
1. Convenience goods
Goods purchased
- Frequently
- Immediately
- Minimum effort
Example
- Newspapers
- Bread
- Milk
Distributed at shops very near to households

PRODUCT 19
 Marketing Mix and Product Management

2. Shopping goods
- Goods that the customer in the process of
selection and purchase
- Characteristically compares on such basis
as suitability, quality, price and style
Examples
- Furniture
- Clothing
- Appliances

PRODUCT 20
 Marketing Mix and Product Management
3. Speciality goods
- Unique characteristics
- Unique brand values
- Buyers willing to make extra efforts
Example
- Arrow shirts
Very few outlets, exclusive
- Honda showrooms
One in Badarpur, Udyog Nagar
Customers willing to travel that far to buy their
choice of goods

PRODUCT 21
 Marketing Mix and Product Management

4. Unsought goods
- Goods the consumer does not know about
or does not normally think of buying
- Consumers made aware through
promotional efforts of the firm.
Examples
- Life insurance
- Security equipments
- Fitness equipment

PRODUCT 22
 Product Management
• Product Management is the planning activities
related to the management of product(s) or
product line.
• Involves obtaining organizational support for
the marketing plan.
 Scope and Importance
• Design product strategies.
• Spot market opportunities.
• Develop strategies for each stage of product
life cycle.
• Generate new product ideas.
• Greater customer focus.
 Role of Product Manager

Advertising
Manufacturing Agency Media
Promotion
& distribution
services

R&D Packaging

Product
Manager

Legal Purchasing

Fiscal Publicity
Market
Research Sales
 What Is A Product Manager?
Product Management is a strategic and business-oriented role,
focused on delivering solutions to market needs.

Product Managers...
‣ Identify profitable opportunities that meet market needs
‣ Launch products into the market
‣ Oversee products already in the market
‣ Wind down products that no longer meet market needs
 Understands The Market
‣Communicates with customers & prospective customers
‣Conducts usability tests
‣Surveys
‣Keeps an ongoing record of compliments/complaints
‣Actually uses the product regularly
 Develops Market-Based Product
Strategies
‣Research, research, research
‣Is aware of, and understands, the competition...
‣... but is not just lavishly copying their feature sets
 Creates Relevant, Usable Documentation
‣BRD: Business Requirements Document - Identifies business problems, solutions
‣MRD: Market Requirements Document - Functional, non-functional requirements
‣PRD: Product Requirements Document - Feature details, user interface, flow
‣FSD: Functional Specifications Document - Engineers, screen by screen
‣Note: Not every company uses these acronyms--or docs--in the same way!
 Brings Products Into (And Out Of) The
Market
‣Your job is to meet market demands and actually make it to market
‣Realize that pioneering doesn’t always pay…
‣But understand the importance of not falling behind the curve
‣Timing is crucial
‣Examples: Xerox’s Star computer (’81), Lycos TV (’99)

Image source: [Link]

 Develops Customer Relationships
The Means... The 5-C Method...
‣Face to face ‣Clear, not jargon
‣Email ‣Concise, not convoluted
‣Blog ‣Confident, not weasel words
‣Telephone ‣Courteous
‣Social networks ‣Completely understands the issue

Image source: [Link] Image source: [Link]

 Bridges Every Department That Touches
Product
‣Sales
‣Marketing Communications
‣Engineering
‣Design
‣Customer Service
‣QA
‣Operations
The Product Manager’s Role: To Avoid
This
 What Else Does A Product Manager Do?
‣Manages the brand
‣Generates sales leads
‣Responsible for the profit & loss of the product
‣Brings new products to life... maximizes profits in existing products...
winds down unsuccessful products
‣Champions the product, internally and externally
 In Short…
Product Managers analyze market data to make intelligent
decisions, chart the course, and captain the product
toward its intended destination.
 Challenges of Product Management

• Internet
• Data explosion
• Increased emphasis on brand equity
• Changes in the balance of market power
• Increased importance of customer retention
programs
• Global competition
 Product Planning

 How are decisions made to

introduce new products and
delete old ones?
 What is Product Planning?

• Product Planning: The decisions made about what

features should be used in selling of a business’s
products.
• These decisions relate to:

 packaging  guarantees
 labeling  branding
 warranties  product mix
 Product Planning
Involves making
decisions about
those features that
are needed to sell a
business’s products,
services, or ideas.
 What is Product Planning? (cont.)
• Product Mix: All the different products that a company makes or sells.
– Product Line: A group of closely related products manufactured or
sold by a business.
– Product Item: A specific model, brand, or size of a product within a
product line.
– Product Width: The number of different product lines a business
manufactures or sells.
– Product Depth: The number of product items in a product line.
What is Product Planning? (cont.)
• A well defined product plan allows a business to:
– Create sales opportunities.
– Design appropriate marketing programs.
– Develop effective advertising campaigns.
– Coordinate the product mix offered to customers.
– Add new products.
– Delete older products that no longer appeal to
customers
 4 P’s of the PRODUCT MIX
• PRICE

• PRODUCT

• PLACE

• PROMOTION
 PRODUCT MIX
= all the types of products a company makes or
sells. The particular assortment of goods and
services that a business offers to meet the
needs of its market(s) and its company goals.
Product Mix and Product Line
PRODUCT
PRODUCTMIX MIX
The
Theset
setof
ofall
allproducts
productsoffered
offered
for
forsale
saleby
byaacompany
company

PRODUCT
PRODUCTLINELINE
AAbroad
broadgroup
groupofof
products
productsfor
forsimilar
similaruses
uses
and
andwith
withsimilar
similarcharacteristics
characteristics
 Product Mix
Includes all the different products that a
company makes or sells.
 Identify ways in which product lines can be
organized.
• Product Line = group of closely related products
manufactured by a business
• Product Item = specific model, brand, or size of
a product within a line
– Ex: P&G has over 250 products within 21 product lines
• Dish care is a product line
– Cascade, Dawn, Joy,
& Ivory are
product items
• Some companies have different brands for different
markets
• Coca-Cola has different drinks for sparkling beverages,
water, juice, performance, coffee, tea, and
international flavors.
 Product Line
A group of closely related products
manufactured and/or sold by a business.
 Product Item
A specific model, brand, or size of a product
within a product line.
 DIMENSIONS
• WIDTH = number of product lines carried by a company.
– NARROW = offering a limited number of product lines
– BROAD = many different product lines carried

• DEPTH = number of products and the assortment of sizes, colors,

and models offered in a product line
– SHALLOW = limited variety within a product line
– DEEP = extensive variety within a product line
 Product Mix

PRODUCT DEPTH
PRODUCTMIX
MIX
Variety
of
sizes,
colors,
models
within
a
product
BREADTH The number of product lines carried line
 Product Width
The number of different product lines a
business manufactures or sells.

Width of the Gillette Product Mix

Oral Blades & Personal Batteries Appliances

Care Razors Care
 Product Depth
The number of product items offered within
each product line.
Oral Blades & Personal Batteries Appliances
Care Razors Care
 NARROW PRODUCT MIX

= Limited product lines carried, typically very

specialized. A description of the width of a
business's product mix offering a limited number of
product lines.
 Broad Product Mix

= Many different product lines carried. A

description of the width of a business's product
mix offering many product lines.
 Shallow Product Mix

= Limited variety within a product line. A

description of the depth of a business's product
mix offering few items in the product line.
 Deep Product Mix

= Extensive variety within a product line. A

description of the depth of a business's
product mix offering a great many items in
the product line.
 Identify reasons that a business would offer
a narrow product mix.

• Product Width – number of different product lines

• CONTRACTING - Pruning weak brands can strengthen the
remaining brands in the line.
– Ease on management
– Cost effective
– Simplicity
– Consistency
 Identify reasons that a business would offer
a broad product mix.

• Product Width – number of different product lines

• EXPANDING
– Reach all markets
– Competitive advantage
– Ex: Red Lobster specializes in seafood, but offers chicken and
steak to broaden their product mix.
 Identify reasons that a business would offer
a deep product mix.

• Product Depth – number of items offered within

each product line

• EXPANDING
– Variety
– Quantity
Ex: Kohl’s carries various quantities of sizes,
colors, & styles of Levi Jeans.
 Identify reasons that a business would offer
a shallow product mix.

• Product Depth – number of items offered within each

product line

• CONTRACTING
– Cost effective
– Satisfy small markets

– Ex: Only 2 chicken items on Red Lobster’s menu.

 REVIEW:

What are some key

product mix

strategies?
Product-Mix Strategies

Expansion
Expansion Contraction
Contraction

Alteration
Alteration of
of
Trading
Trading Up
Up and
and
existing
existing products
products
Trading
Trading Down
Down
 Explain the importance of a business’s
product mix.

• Businesses must plan their product mix carefully

because they cannot offer all the products that
customers may want.

• They should be a profitable market for product

offered by a company
 How do businesses
determine which products to
produce and sell?

• Businesses will use different product mix strategies to

determine what to produce or sell.
• Product mix strategies depend on:
– Resources
– Objectives
– Past and current sales
– Consumer trends
 Product Mix Strategies
• The plan for how the business determines which products it
will make or stock

• May develop completely new products

• May expand or modify their current product lines

• May drop existing products

EXPANSION
 Developing New Products
• Generating Ideas
– Come from a variety of sources
– Creativity is essential

• Screening Ideas
– Ideas are evaluated and matched against the company’s
overall objectives.
 Developing New Products (cont.)

• Developing a Business Proposal

– Consider a product’s potential sales, costs, and
production requirements.

• Developing the Product

– The new idea takes physical shape
– Marketers develop a marketing strategy.

• Testing the Product with consumers

 Developing New Products (cont.)

• Introducing the Product

– The product has been researched successfully
– This stage also is called commercialization.

• Evaluating Customer Acceptance

– Marketers track new product performance.
 EXPANSION
ADVANTAGES DISADVANTAGES
• Extend product lifecycle • Adding items to a product line
or introducing an entire
• Adding items to a product product line can be expensive,
line or introducing an be difficult to manage, and not
entire product line can always be successful.
capture market share and
meet customer’s needs
and wants.
Deleting a Product or Product Line
• Obsolescence
• Loss of appeal
• Conflict with current company objectives
• Replacement with new products
• Lack of profit
• Conflict with other products in the line
 CONTRACTION
ADVANTAGES DISADVANTAGES
• Cut losses • Deleting products from a product
• Reallocate resources to more line or the entire product line is
profitable products conceding market share to your
• Deleting products from a competitors.
product line or the entire • It may be wiser to improve the
product line can be cost existing product or line to
effective and easier to recapture market share.
manage while creating
simplicity and consistency
 Describe alteration product-mix strategies.

• Alteration of Existing Products:

– Making changes to meet customer needs &
wants
– Improve an established product with new
design, new package, new uses.
• Ex: Jeep offering 4 doors
Developing Existing Products
(ALTERATION)
• Companies constantly review their product mix to see
if they can further expand their product lines or
modify existing products.

• Two ways to do this:

 Developing Existing Products (cont.)

Line Extensions – new product lines, items,

or services
Original Product

Newer Products
Developing Existing Products (cont.)

Product Modifications – an alteration in a

company’s existing product
 ALTERATION
ADVANTAGES DISADVANTAGES
• Improving an • Improving an established
established product product is expensive and not
can capture new always a success. Example:
customers and meet New Coke
customer’s unmet
wants as trends
change. Ex:
McDonald’s opening
stores in India
 Product Mix Strategies
• Developing New Products
– Follows seven steps:
• Generate Ideas
• Screen Ideas
• Develop a Business Proposal
• Test the product with consumers
• Introduce the product
• Evaluate customer acceptance
 Product Mix Strategies (cont)
• Developing Existing Products
– Line Extensions: Adding new product lines, items or services.
• Ex: Tylonol
– Product Modifications: An alteration to an existing product:
• New and different varieties
• Formulations
• Colors
• Styles
• Features
• Sizes
 Product Mix Strategies (cont)

• Deleting a Product or Product Line

– Obsolescence
– Loss of Appeal
– Changes in Company Objectives
– Replacement with New Products
– Lack of Profit
– Conflict with other products in the line
 Describe trading up / down product-mix
strategies.
• Trading up: Adding a higher-priced product to a line to attract
a higher-income market and improve the sales of existing
lower-priced products.
• Trading down: Adding a lower-priced item to a line of prestige
products to encourage purchases from people who cannot
afford the higher-priced product, but want the status.
 TRADING UP
ADVANTAGES DISADVANTAGES
• Adding higher priced items • While sales may be generated for the new product or
line, sales of established products may decline.
to a product line will attract • If the business uses trading up to enhance its image,
the higher income market the business must be careful that present customers
and may help increase the are not lost in the process of gaining new ones.
• Customers may become confused as to what the
image and sales of the lower company’s image is meant to be, or they may refuse to
priced items. believe that better quality merchandise can be
purchased from a business that had formerly sold
budget goods.
• Adding higher priced items to a product line is
expensive and may not attract new customers while
hurting the image and sales of the lower priced items.
 TRADING DOWN
ADVANTAGES DISADVANTAGES
•
• Adding lower priced items Adding lower priced items to a product line of
prestige products can hurt the image and sales of
to a product line of the higher priced items in the line
prestige products can • Consumers may be confused about the new product
or line.
capture a lower income • Profits from the cheaper product may be eroded by
market who cannot afford reduced sales in the more expensive line.
• Dealers may not be willing to add the lower priced
the higher priced items. product to their offering.
• Competition may become stronger at the high end
of the market.
• Gaining short-term sales at the expense of long term
sales
 How are

products/services

positioned in the

market place?
POSITIONING is about bringing
attention to products and
DIFFERENTIATING them from
similar ones.
 Positioning the Product
Differential
Differential
COMPETITOR
COMPETITOR advantage
advantage

PRODUCT
PRODUCTCLASS
CLASS Associated
Associated with
with
OR
ORATTRIBUTE
ATTRIBUTE attractive
attractive attribute
attribute

High
High price/high
price/high quality
quality
PRICE
PRICE or
or
AND
ANDQUALITY
QUALITY low
low price
price
Product Positioning = the IMAGE a product projects
• The goal is to set the product apart from the competition.

• “The way you get into your customer’s mind.”

• The efforts a business makes to identify, place, and sell its

products.
 Describe positioning product-mix strategies.

• Positioning – is all about perception; actions marketers take to

create a certain image of a product in the minds of the customers
• In Relation to a Competitor
• In Relation to a Product Class or Attribute
• In Relation to a Target Market
• By Price and Quality
• Difficult to change
 Product Positioning
• Product positioning: Efforts a business makes to
identify, place and sell its products in the marketplace.
– Positioning by price and quality:
• Ex: Ford Motor Company positions its Focus as an
economical passenger car while still emphasizing
quality.
 Positioning by Price & Quality
• Offer economy, mid-priced, and luxury lines
 Product Positioning (cont)

– Positioning by features and benefits:

• Ex: Oil of Olay was positioned as a premium
facial moisturizer and cleanser to keep skin
soft and young.

– Positioning by unique characteristics:

• Ex: Cell phones that can text message or
take pictures and send them.
 Positioned by Features & Benefits

• Unique characteristics
Product Positioning (cont)

– Positioning in relation to the competition:

• Ex: Warner-Lambert Company introduced
Cool Mint Listerine by positioning against
the “theraputic” benefits of Original
Listerine and the “cosmetic” benefits of
Scope.

– Positioning in relation to other products in a

line:
• Ex: Binney & Smith introduced washable
crayons and positioned them as a specialty
item in the company’s Crayola crayon line.
 Positioning in
Relation to the Competition
Positioning in Relation to
Other Products in a Line
 POSITIONING STRATEGIES
ADVANTAGES DISADVANTAGES
• Creating an identity of a • Images of a product are
product helps find a place difficult to change once they
for the product in the are established and very
marketplace while expensive.
strongly identifying with a
specific target market and
possibly creating brand
loyalty.
 6 Steps to Successful Positioning

1. What position do you currently own?

2. What position do you want to own?
3. Whom you have to defeat to own the position you want.
4. Do you have the resources to do it?
5. Can you persist until you get there?
6. Are your tactics supporting the positioning objective you
set?