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P od ct Se icesP od ct Se icesProduct, Services, Product, Services, and Brandingand Brandingand Branding and Branding
StrategiesStrategiesgg
Ch t 9Ch t 9Chapter 9Chapter 9
Objectives
B bl t d fiB bl t d fi d td t d kd kBe able to define Be able to define productproduct and know and know the major classifications of products the major classifications of products and services.and services.Understand the decisions companiesUnderstand the decisions companiesUnderstand the decisions companies Understand the decisions companies make regarding their individual make regarding their individual products and services product linesproducts and services product linesproducts and services, product lines, products and services, product lines, and product mixes.and product mixes.U d t d h fi b ild dU d t d h fi b ild dUnderstand how firms build and Understand how firms build and manage their brands.manage their brands.
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Objectives
K h f h i i fK h f h i i fKnow the four characteristics of Know the four characteristics of services and the additionalservices and the additionalservices and the additional services and the additional marketing considerations that marketing considerations that
i ii iservices require.services require.Review additional product issuesReview additional product issuesReview additional product issues Review additional product issues related to social responsibility and related to social responsibility and i t ti l k tii t ti l k tiinternational marketing.international marketing.
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DefinitionDefinition
ProductProductA thi ff dA thi ff dAnything offered Anything offered to a market for to a market for attention, attention, acquisition, acquisition, q ,q ,consumption or consumption or use that mightuse that mightuse that might use that might satisfy a need satisfy a need or wantor want
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or want.or want.
DefinitionDefinition
ServiceServiceAnyAny activityactivity ororAny Any activityactivity or or benefitbenefit that one that one party can offer toparty can offer toparty can offer to party can offer to another that is another that is essentiallyessentiallyessentially essentially intangible and intangible and does not result indoes not result indoes not result in does not result in the ownership of the ownership of anythinganything
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anything.anything.
What is a Product?What is a Product?
Products, Products, Services &Services &Services, & Services, & ExperiencesExperiences
M k tM k tMarket Market offerings, offerings, pure pure tangible tangible
ddgoods, pure goods, pure services, services,
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experiencesexperiences Experiences include zoos and aquariums Experiences include zoos and aquariums
Fig re 9 1Figure 9-1:
Three Levels of ProductThree Levels of Product
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What is a Product?What is a Product?
Product and service Product and service classifications fall intoclassifications fall intoclassifications fall into classifications fall into two broad classes based two broad classes based on the types of buyers on the types of buyers who use them:who use them:who use them:who use them:
Consumer productsConsumer productsIndustrial productsIndustrial products
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What is a Product?
Frequent purchasesFrequent purchasesTypes ofTypes of Frequent purchases Frequent purchases bought with minimal bought with minimal buying effort andbuying effort and
Types of Types of Consumer ProductsConsumer Products
ConvenienceConveniencebuying effort and buying effort and little comparison little comparison shoppingshopping
ShoppingShoppingshoppingshoppingLow priceLow priceWid dWid dSpecialtySpecialty Widespread Widespread distributiondistribution
UnsoughtUnsought Mass promotion Mass promotion by producerby producer
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y py p
What is a Product?
Less frequentLess frequentTypes ofTypes of Less frequent Less frequent purchases requiring purchases requiring more shopping effort more shopping effort
Types of Types of Consumer ProductsConsumer Products
ConvenienceConvenienceand price, quality, and and price, quality, and style comparisons. style comparisons. Hi h i d thHi h i d th
ShoppingShoppingHigher priced than Higher priced than convenience goodsconvenience goodsS l ti di t ib ti iS l ti di t ib ti iSpecialtySpecialty Selective distribution in Selective distribution in fewer outletsfewer outletsAdvertising andAdvertising andUnsoughtUnsought Advertising and Advertising and personal selling by personal selling by producer and resellerproducer and reseller
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producer and resellerproducer and reseller
What is a Product?
Strong brand preferenceStrong brand preferenceTypes ofTypes of Strong brand preference Strong brand preference and loyalty, requires and loyalty, requires special purchase effort,special purchase effort,
Types of Types of Consumer ProductsConsumer Products
ConvenienceConveniencespecial purchase effort, special purchase effort, little brand little brand comparisons, and low comparisons, and low
ShoppingShoppingp ,p ,
price sensitivityprice sensitivityHigh priceHigh price
SpecialtySpecialtyHigh priceHigh priceExclusive distributionExclusive distributionCarefully targetedCarefully targetedUnsoughtUnsought Carefully targeted Carefully targeted promotion by producers promotion by producers and resellersand resellers
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and resellersand resellers
What is a Product?
Little productLittle productTypes ofTypes of Little product Little product awareness and awareness and knowledge (or if aware,knowledge (or if aware,
Types of Types of Consumer ProductsConsumer Products
ConvenienceConvenienceknowledge (or if aware, knowledge (or if aware, sometimes negative sometimes negative interest)interest)
ShoppingShopping))
Pricing variesPricing variesDistribution variesDistribution varies
SpecialtySpecialtyDistribution variesDistribution variesAggressive advertising Aggressive advertising and personal selling byand personal selling byUnsoughtUnsought and personal selling by and personal selling by producers and resellersproducers and resellers
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What is a Product?What is a Product?
Product and Service ClassificationsProduct and Service ClassificationsI d t i l d t thI d t i l d t thIndustrial products are those Industrial products are those purchased for use in conducting a purchased for use in conducting a business or those purchased as business or those purchased as ingredients or components to be used ingredients or components to be used g pg pin manufacturing.in manufacturing.
Materials and partsMaterials and partsMaterials and partsMaterials and partsCapital itemsCapital items
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Supplies and servicesSupplies and services
What is a Product?What is a Product?
Product and Service ClassificationsProduct and Service Classifications“Products” also include organizations“Products” also include organizations“Products” also include organizations, “Products” also include organizations, persons, places, and ideaspersons, places, and ideas
O i ti l k ti k fO i ti l k ti k fOrganizational marketing makes use of Organizational marketing makes use of corporate image advertisingcorporate image advertisingPerson marketing applies to politicalPerson marketing applies to politicalPerson marketing applies to political Person marketing applies to political candidates, entertainment sports figures, and candidates, entertainment sports figures, and professionalsprofessionalsprofessionalsprofessionalsPlace marketing relates to tourismPlace marketing relates to tourismSocial marketing campaigns promote ideasSocial marketing campaigns promote ideas
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Social marketing campaigns promote ideasSocial marketing campaigns promote ideas
Product & Service Decisions
Product attributesProduct attributesK D i iK D i i Product attributesProduct attributesQuality, features, Quality, features,
Key DecisionsKey Decisions
Individual Individual ProductProduct
style and designstyle and designBrandingBrandingProductProduct
Product LineProduct LineBrandingBrandingPackagingPackagingProduct Line Product Line
Product MixProduct Mix
g gg gLabelingLabelingoductoductProduct support Product support servicesservices
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servicesservices
Fig re 9 2Figure 9-2:
Individual ProductIndividual Product and Service Decisions a d Se ce ec s o s
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Product & Service DecisionsProduct & Service Decisions
Innovative productInnovative productInnovative product Innovative product design can help design can help revitalize arevitalize arevitalize a revitalize a company, such as company, such as
ith th A l iMith th A l iMwith the Apple iMac.with the Apple iMac.
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Product & Service DecisionsProduct & Service Decisions
Brand:Brand:Brand:Brand:A name, term, sign, A name, term, sign, symbol design or asymbol design or asymbol, design, or a symbol, design, or a combination of combination of these, that identifiesthese, that identifiesthese, that identifies these, that identifies the maker or sellers the maker or sellers of a product orof a product orof a product or of a product or service.service.
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Product & Service DecisionsProduct & Service Decisions
Packaging involves designing a Packaging involves designing a container or wrapper for a productcontainer or wrapper for a productcontainer or wrapper for a productcontainer or wrapper for a product
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Product & Service DecisionsProduct & Service Decisions
Many aspects of a food product’s Many aspects of a food product’s label are dictated by lawlabel are dictated by lawlabel are dictated by lawlabel are dictated by law
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Product & Service DecisionsProduct & Service Decisions
Support services Support services via the webvia the webvia the web via the web include FAQ files, include FAQ files, email queries liveemail queries liveemail queries, live email queries, live chat with chat with customer servicecustomer servicecustomer service customer service personnel, and personnel, and software updatessoftware updatessoftware updatessoftware updates
1-800 Flowers
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1 800 Flowers
Product & Service Decisions
Product line lengthProduct line lengthK D i iK D i i Product line lengthProduct line lengthLine stretching:Line stretching:adding products thatadding products that
Key DecisionsKey Decisions
Individual Individual ProductProduct
adding products that adding products that are higher or lower are higher or lower priced than thepriced than theProductProduct
Product LineProduct Linepriced than the priced than the existing lineexisting lineLine filling:Line filling: addingaddingProduct LineProduct Line
Product MixProduct MixLine filling:Line filling: adding adding more items within the more items within the present price rangepresent price rangeoductoduct present price rangepresent price range
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Product & Service Decisions
Product line width:Product line width:K D i iK D i i Product line width:Product line width:Number of different Number of different product lines carriedproduct lines carried
Key DecisionsKey Decisions
Individual Individual ProductProduct
product lines carried product lines carried by companyby company
P d t li d thP d t li d thProductProductProduct LineProduct Line
Product line depth:Product line depth:Number of different Number of different Product Line Product Line
Product MixProduct Mixversions of each versions of each product in the lineproduct in the lineoductoduct
Product line Product line consistencyconsistency
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consistencyconsistency
Branding StrategyBranding Strategy
Brands are powerful Brands are powerful assets that must beassets that must beassets that must be assets that must be carefully developed carefully developed and managed.and managed.
Both Tiger WoodsBoth Tiger WoodsBoth Tiger Woods Both Tiger Woods and Nike can be and Nike can be
id d b did d b dconsidered brandsconsidered brands
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Branding StrategyBranding Strategy
Brands with strong Brands with strong equity have manyequity have manyequity have many equity have many competitive competitive advantages:advantages:advantages:advantages:
High consumer awareness High consumer awareness St b d l ltSt b d l ltStrong brand loyaltyStrong brand loyaltyHelps when introducing Helps when introducing new productsnew productsnew productsnew productsLess susceptible to price Less susceptible to price competitioncompetition
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pp
Fig re 9 3Figure 9-3:
Major BrandMajor Brand Strategy Decisions S a egy ec s o s
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Brand Strategy
Three levels ofThree levels ofK D i iK D i i Three levels of Three levels of positioning:positioning:
Key DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand Name
Product attributesProduct attributesLeast effectiveLeast effectiveBrand Name Brand Name
Selection Selection B dB d
Least effectiveLeast effectiveBenefitsBenefits
Brand Brand SponsorshipSponsorship
Beliefs and valuesBeliefs and valuesTaps intoTaps into
Brand Brand DevelopmentDevelopment
Taps into Taps into emotionsemotions
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DevelopmentDevelopment
Brand Strategy
Good Brand Names:Good Brand Names:K D i iK D i i Good Brand Names:Good Brand Names:Suggest something Suggest something about the product or its about the product or its
Key DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand Name
benefitsbenefitsAre easy to say, Are easy to say,
i di dBrand Name Brand Name Selection Selection B dB d
recognize and recognize and rememberrememberAre distinctiveAre distinctiveBrand Brand
SponsorshipSponsorshipAre distinctiveAre distinctiveAre extendableAre extendableTranslate well intoTranslate well into
Brand Brand DevelopmentDevelopment
Translate well into Translate well into other languagesother languagesCan be registered and Can be registered and
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DevelopmentDevelopment gglegally protectedlegally protected
Brand Strategy
Manufacturer brandsManufacturer brandsK D i iK D i i Manufacturer brandsManufacturer brandsKey DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand NameBrand Name Brand Name SelectionSelectionB dB dBrand Brand SponsorshipSponsorshipBrand Brand DevelopmentDevelopment
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DevelopmentDevelopment
Brand Strategy
Private (store) brandsPrivate (store) brandsK D i iK D i i Private (store) brandsPrivate (store) brandsCostly to establish and Costly to establish and promotepromote
Key DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand Name
promotepromoteHigher profit marginsHigher profit margins
Brand Name Brand Name SelectionSelectionB dB dBrand Brand SponsorshipSponsorshipBrand Brand DevelopmentDevelopment
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DevelopmentDevelopment
Brand Strategy
Licensed brandsLicensed brandsK D i iK D i i Licensed brandsLicensed brandsName and character Name and character licensing has grownlicensing has grown
Key DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand Name
licensing has grownlicensing has grown
Brand Name Brand Name SelectionSelectionB dB dBrand Brand SponsorshipSponsorshipBrand Brand DevelopmentDevelopment
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DevelopmentDevelopment
Brand Strategy
CoCo--brandingbrandingK D i iK D i i CoCo brandingbrandingAdvantagesAdvantages
Broader consumer Broader consumer Key DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand Name
appealappealGreater brand equityGreater brand equityEfficient means ofEfficient means ofBrand Name Brand Name
SelectionSelectionB dB d
Efficient means of Efficient means of expansion into new expansion into new product categoriesproduct categories
Brand Brand SponsorshipSponsorship
LimitationsLimitationsComplex legal contractsComplex legal contractsR i f lR i f l
Brand Brand DevelopmentDevelopment
Requires careful Requires careful coordination of IMCcoordination of IMCRequires that partners Requires that partners
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DevelopmentDevelopment q pq ptrust one anothertrust one another
Brand Strategy
Line extensionsLine extensionsK D i iK D i i Line extensionsLine extensionsMinor changes to existing Minor changes to existing productsproducts
Key DecisionsKey Decisions
Brand PositioningBrand PositioningBrand NameBrand Name
ppBrand extensionsBrand extensions
Successful brand namesSuccessful brand namesBrand Name Brand Name SelectionSelectionB dB d
Successful brand names Successful brand names help introduce new help introduce new productsproducts
Brand Brand SponsorshipSponsorship
MultibrandsMultibrandsMultiple product entries in Multiple product entries in
Brand Brand DevelopmentDevelopment
a product categorya product categoryNew brandsNew brands
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DevelopmentDevelopment New product categoryNew product category
Fig re 9 4Figure 9-4:
Brand DevelopmentBrand DevelopmentStrategies S a eg es
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Brand StrategyBrand Strategy
Li E t i MLi E t i MLine Extensions May Line Extensions May Feature Different ThingsFeature Different ThingsFeature Different ThingsFeature Different Things
FlavorsFlavorsC lC l
FormsFormsI di tI di tColorsColors IngredientsIngredients
Package SizesPackage Sizes
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Services MarketingServices Marketing
ServicesServicesAccount for 74% ofAccount for 74% ofAccount for 74% of Account for 74% of U.S. gross domestic U.S. gross domestic productproductproduct.product.Service industries Service industries i l d b ii l d b iinclude business include business organizations, organizations,
t dt dgovernment, and government, and private notprivate not--forfor--profit profit
i tii ti9- 42
organizations.organizations.
Fig re 9 5Figure 9-5:
Four ServicesFour Services Characteristics C a ac e s cs
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Fig re 9 6Figure 9-6:
Three Types of MarketingThree Types of Marketing in Services Industries Se ces dus es
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Services MarketingServices Marketing
Service Firm Marketing StrategiesService Firm Marketing StrategiesTh S iTh S i P fit Ch iP fit Ch iThe ServiceThe Service--Profit ChainProfit Chain
Internal Marketing:Internal Marketing: service firms service firms train and effectively motivate their train and effectively motivate their employees to work as a team to employees to work as a team to p yp ysatisfy the customersatisfy the customerInteractive Marketing:Interactive Marketing: recognizes thatrecognizes thatInteractive Marketing:Interactive Marketing: recognizes that recognizes that service quality depends heavily on the service quality depends heavily on the quality of buyerquality of buyer--seller interactionseller interaction
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quality of buyerquality of buyer--seller interactionseller interaction
Services MarketingServices Marketing
Service Firm Marketing StrategiesService Firm Marketing StrategiesM i S i Diff ti tiM i S i Diff ti tiManaging Service DifferentiationManaging Service Differentiation
British Airways British Airways differentiates its differentiates its service by offering service by offering firstfirst--class world class world travelers private travelers private “demi“demi--cabins”cabins”
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Services MarketingServices Marketing
Service Firm Marketing StrategiesService Firm Marketing StrategiesManaging Service QualityManaging Service QualityManaging Service QualityManaging Service Quality
One method of differentiationOne method of differentiationCustomer retention is often the best measureCustomer retention is often the best measureCustomer retention is often the best measureCustomer retention is often the best measureTop service firms are “customer obsessed”Top service firms are “customer obsessed”S i d l tS i d l tService recovery and employment Service recovery and employment empowerment are keyempowerment are key
M i S i P d ti itM i S i P d ti itManaging Service ProductivityManaging Service ProductivityMany methods of enhancing productivity Many methods of enhancing productivity
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Key is to avoid reducing qualityKey is to avoid reducing quality
Additional Product C id tiConsiderations
Product Decisions and SocialProduct Decisions and SocialProduct Decisions and Social Product Decisions and Social ResponsibilityResponsibility
Acquisitions and mergersAcquisitions and mergersLegal complianceLegal complianceProduct liability issuesProduct liability issuesProduct liability issuesProduct liability issuesWarrantiesWarranties
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Additional Product C id tiConsiderations
International Product and ServicesInternational Product and ServicesInternational Product and Services International Product and Services MarketingMarketing
Special challenges:Special challenges:Special challenges:Special challenges:Which products should be marketed Which products should be marketed i t ti ll ?i t ti ll ?internationally?internationally?Should the products be standardized Should the products be standardized
ffor adapted for world markets?or adapted for world markets?How should packaging be adapted?How should packaging be adapted?
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How can other barriers be overcome?How can other barriers be overcome?