what is a product? anything that can be offered to a market for attention, acquisition, use, or...

What is a Product?

• Anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need.– Includes: physical objects, services, events, persons,

places, organizations, ideas, or some combination thereof.

Lähde: Kotler-Armstrong, Principals of Marketing

Levels of a Product


What is a Product? BMW

• Augmented– Social status– Brand name

• Actual– Luxuriant car– Stereo, trim, engine size– Showroom

• Core– Transport for one or more

people

Actual

Core

Augmented


Individual Product Decisions


Product and Service Attributes

• Quality LAATU– Performance and satisfaction includes level and consistency

• Features OMINAISUUDET– Differentiates a product from the competition; assessed

based on value and cost• Style and Design TYYLI JA DESIGN

– Style = Appeareance– Design = heart of the product


Branding

• Creating, maintaining, protecting, and enhancing products and services.

• A brand is a name, term, sign, symbol, or design, or a combination of these, that identifies the maker or seller of a product or service.


Branding

• Advantages to buyers:– Product identification– Product quality

• Advantages to sellers:– Basis for product’s quality story– Provides legal protection– Helps to segment markets


Packaging

• Designing and producing the container or wrapper for a product.

• Developing a good package:– Packaging concept– Package elements– Product safety– Environmental concerns


Labeling

• Printed information appearing on or with the package.

• Performs several functions:– Identifies product or brand– Describes several things about the product– Promotes the product through attractive graphics


Product Support Services

• Assess the value of current services and obtain ideas for new services.

• Assess the cost of providing the services.• Put together a package of services that delights the

customers and yields profits for the company.


Product Lines

• What is a 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 outlet, or fall within given price ranges

• Example Product Lines– Toyota cars– iPods– Coke – cans, multi-packs, bottles (glass/plastic)


Product Line Decisions

Product Line Length- Number of items in the product line

Product Line Length- Number of items in the product line

StretchingLengthen beyond current range.-Downward-Upward-Both directions

StretchingLengthen beyond current range.-Downward-Upward-Both directions

FillingLengthen within current range.

FillingLengthen within current range.


Product Mix Decisions

• Product Mix: all of the product lines and items that a particular seller offers for sale.

• Width: the number of different product lines the company carries.

• Depth: the number of versions offered of each product in the line.

• Consistency: how closely related the various lines are.


Brand Equity

• The positive differential effect that knowing the brand name has on customer response to the product or service.

• Provides:– More brand awareness and loyalty– Basis for strong, profitable customer

relationships


Major Brand Strategy Decisions


Brand Name Selection

• Desirable qualities for a brand name include:1. It should suggest product’s benefits and qualities2. It should be easy to pronounce, recognize, and

remember3. It should be distinctive4. It should be extendable5. It should translate easily into foreign languages6. It should be capable of registration and legal

protectionLähde: Kotler-Armstrong, Principals of

Marketing

Brand Sponsorship

• Four options / NELJÄ VAIHTOEHTOA– Manufacturer’s brands– Co-branding– Private brands– Licensed brands


Line

Extension

New BrandsMultibrands

Brand

Extension

Product Category

Bra

nd N

ame

Exis

ting

New

Existing New

Branding Strategies


Line Extension

• Same Brand Name – Additional Items– New flavours– New sizes – Family/fun size– Ingredients – fat-free, vitamins

• This is by Far the Most Common Branding Activity– Safety – an understood market– Meets customer demands for variety

• Problems– Can dilute focus of the brand– Coke – regular, can, bottle, diet, diet with lemon, diet with

vanilla or cherry?Lähde: Kotler-Armstrong, Principals of

Marketing

Brand Extension

• Using a Successful Brand Name to Launch a New Product– Fairy Liquid – Fairy Detergent– Sony TV – Sony Playstation

• Can Fail– Heinz Soup – Heinz pet food– Porsche Cars – Porsche Toasters

• Some Brands Stretch Further than Others– Virgin – rail, mobile phones, air, music, cola

• The Extension MUST be Compatible with the Original Product/Associations


Multibrands

• Where the Focus is on the Brand, Not the Manufacturer– Lever – Persil, Surf, Radion– Tends to happen where the firm has more than one brand in the

same market• Product Families

– Some firms have brands for ranges of their products– Families grouped together by price/quality etc– Matsushita - Technics, National, Panasonic

• Drawbacks– Cannibalisation– Can be very costly


New Brands

• Toyota and Lexus– To create differentiation between the brands– To increase the gap in perception– Toyota=Mass market - Lexus=Luxury

• Brand Proliferation– Can cause weakness across the portfolio– Megabrand strategies – only the strongest receive

investment• Fighter Brands


Major Stages in New-Product Development


Concept Development and Testing

• Product Idea: idea for a possible product that the company can see itself offering.

• Product Concept: detailed version of the idea stated in meaningful consumer terms.

• Product Image: the way consumers perceive an actual or potential product.


Time

ProductDevelop-ment

Introduction

Profits

Sales

Growth Maturity Decline

Losses/Investments ($)

Sales andProfits ($)

Sales and Profits Over the Product’s Lifetime

Product Life Cycle


Practical Problems of PLC

• Hard to identify which stage of the PLC the product is in• Hard to pinpoint when the product moves to next stage• Hard to identify factors that affect product’s movement

through stages• Hard to forcast sales level. Length of each stafe and

shape of PLC• Strategy is both a cause and result of the PLC


Maturity Stage of the PLC

• Modifying the Market: Increase the consumption of the current product.

• How?– Look for new users and market segments– Reposition the brand to appeal to larger or faster-

growing segment– Look for ways to increase usage among present

customers



• Modifying the Product: Changing characteristics such as quality, features, or style to attract new users and to inspire more usage.

• How?– Improve durability, reliability, speed, taste– Improve styling and attractiveness– Add new features– Expand usefulness, safety, convenience



• Modifying the Marketing Mix: Improving sales by changing one or more marketing mix elements.

• How?– Cut prices– Launch a better ad campaign– Move into larger market channels– Offer new or improved services to buyers


what is a product? anything that can be offered to a market for attention, acquisition, use, or...

Documents

principals of marketinglhde

principals of marketinglevels

principals of marketingwhat

product linestretchinglengthen

package of services

new services

value of current services

good package