Marketing An Introduction 7 Products Services and Brands
Marketing An Introduction 7 Products, Services, and Brands Building Customer Value 3 -1
Learning Objectives • • Define product and describe the major classifications of products and services. Describe the decisions companies make regarding their individual products and services, product lines, and product mixes.
Learning Objectives • • Identify the four characteristics that affect the marketing of services and the additional marketing considerations that services require. Discuss branding strategy—the decisions companies make in building and managing their brands.
Product • Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need • Services: Activities, benefits, or satisfactions offered for sale • Intangible and do not result in ownership of anything
Products, Services, and Experiences • Market offerings include both tangible goods and services. • Companies create and manage customer experiences with their brands or companies. • To differentiate their offers from that of the competitors
Figure 7. 1 - Three Levels of Product Traditional approach – today trends – smart, connected products after sale service, remote control etc. Levels shrinking.
Product and Service Classifications • Consumer products: Bought by final consumers for personal consumption • Industrial products: Bought by individuals and organizations for further processing or for use in conducting a business • Materials and parts, capital items, and supplies and services
Table 7. 1 - Marketing Considerations for Consumer Products
Other Marketable Entities f. e. university f. e. politicians, musicans, showbusiness… Organization marketing Person marketing Place marketing Social marketing Tourism, municipalities….
Product and Service Decisions Individual Product Decisions Product Line Decisions Product Mix Decisions
Figure 7. 2 - Individual Product Decisions
Product Line Decisions • Product line: Closely related products that: • Have similar functions and customer groups • Are sold through similar outlets or fall within given price ranges • Product line length - Number of items in the product line • Product line filling • Product line stretching
Product Mix (or Product Portfolio) • Set of all product lines and items that a particular seller offers for sale
Product Mix Decisions Width • Number of different product lines the company carries Length • Total number of items a company carries within its product lines Depth • Number of versions offered for each product in the line Consistency • Relativity of the various product lines in end use, production requirements, distribution channels, or some other aspect
Figure 7. 3 - Four Service Characteristics
Service Profit Chain • Links service firm profits with employee and customer satisfaction • The links include: • • • Internal service quality Satisfied and productive service employees Greater service value Satisfied and loyal customers Healthy service profits and growth Health. Care Marketing perspectives….
Figure 7. 4 - Three Types of Service Marketing
Marketing Tasks for Service Companies Managing service differentiation • Developing a differentiated offer, delivery, and image Managing service quality • Delivering consistently higher quality than the competitors Managing service productivity • Training current employees or hiring new ones • Increasing the quantity of service by giving up some quality • Harnessing the power of technology
Brand Equity • The differential effect that knowing the brand name has on customer response to the product or its marketing • With positive brand equity, consumers react more favorably to the brand than to an unbranded version of the same product. • With negative brand equity, consumers react less favorably to the brand than to an unbranded version. Brands are powerful assets that must be carefully developed / managed. Brands with strong equity have many competitive advantages: High consumer awareness + Strong brand loyalty + Helps when introducing new products + Less susceptible to price competition
Brand Equity • Consumer perception dimensions include: • • Differentiation Relevance Knowledge Esteem • Brand valuation is the estimation of the total financial value of a brand. • Customer equity is the value of customer relationships that the brand creates.
Major Brand Strategy Decisions Brand positioning Brand name selection • Attributes • Benefits • Beliefs and values • Selection • Protection Brand sponsorship Brand development • • Manufacturer’s brand Private brand Licensing Co-branding Line extensions Brand extensions Multibrands New brands
Brand Positioning and Brand Name Selection • Marketers should establish a mission and vision for the brand when positioning it. • Desirable qualities for a brand name should: • • • Be based on the product’s benefits and qualities Be easy to pronounce, recognize, and remember Be distinctive and extendable Translate easily into foreign languages Be capable of registration and legal protection
Brand Sponsorship National brands • Marketed under the manufacturer’s own name Store brands • Created and owned by a reseller of a product or service Licensing • Use names and symbols created by other companies or wellknown movie characters or celebrities for a fee Co-branding • Use the established brand names of two different companies on the same product
Figure 7. 6 - Brand Development Strategies
Managing Brands • • Communicate the brand’s positioning Manage all brand touch points Train employees to be customer centered Audit the brands’ strengths and weaknesses
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