foundations of Chapter M A R K E T I N G Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Marketing the Total Product: Brand, Image, Warranty, and Packaging 10

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Objectives 1.Explain the concept of a total product and of product management. 2.Discuss the role of brands, brand names, and trademarks. 3.Elaborate on basic approaches to brand management. 4.Understand brand equity and what contributes to it. 5.Explain the importance, role, and functions of packaging. 6.Identify the classifications for consumer products and briefly describe each category. 7.Classify the types of industrial products. Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Total Product A total bundle of physical, service, and symbolic characteristics designed to produce customer want satisfaction Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. The Total Product Concept 10 Figure 10.1 Brand Warranty and service Product image Package and label Physical or Functional Characteristics of a Good or Service 10-3 Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Warranty A guarantee to the buyer that the supplier will replace a defective product (or part of a product) or refund its purchases price during a specified period of time Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand A name, term, sign, symbol, or design (or some combination of these) used to identify the products of one firm and to differentiate them from competitive offerings Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Name Words, letters, or symbols that make up a name used to identify and distinguish the firm’s offerings from those of its competitors Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. A Good Brand Name 1.Easy to pronounce 2.Recognize 3.Remember 4.Legally protectable Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Trademark A brand that has been given legal protection and has been granted solely to its owner Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Generic Name A brand over which the original owner has lost exclusive claim because all offerings in the associated class of products have become generally known by the brand name (usually that of the first or leading brand in that product class) Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Equity Represents the value customers (and the stock markets) place on the sum of the history the customer has had with a brand Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Components of Brand Equity 10 Figure 10.2 Brand association Brand loyalty Brand awareness Perceived quality Source: Reprinted with permission of The Free Press, a Division of Simon & Schuster Adult Publishing Group, from Brand Leadership, by David A. Aaker and Erich Joachimsthaler, p. 17. Copyright © 2000 by David A. Aaker andErich Joachimsthaler Brand Equity Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Loyalty Categories 1.Familiarity 2.Preference 3.Insistence Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Familiarity The first stage of brand loyalty, when a firm has developed enough publicity for a brand that its name is familiar to consumers Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Preference The second stage of brand loyalty, when based on previous experience, consumers will choose a product rather than one of its competitors -- if it is available Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Insistence The ultimate stage of brand loyalty, when consumers will accept no alternatives and will search extensively for the product Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Architecture The relationship between a company’s products, brands and sub-brands Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Leadership 10 Figure 10.3 Organizational Structure and Processes Responsibility for brand strategy Management processes Brand Architecture Brands/subbrands/endorsed brands Roles of brands/subbrands Brand Leadership Brand-Building Program Accessing multiple media Achieving brilliance Integrating the communication Measuring the results Brand Identity/Position Aspirational image Positioning the brand Source: Reprinted with permission of The Free Press, a Division of Simon & Schuster Adult Publishing Group, from Brand Leadership, by David A. Aaker and Erich Joachimsthaler, p. 25. Copyright © 2000 by David A. Aaker andErich Joachimsthaler Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Family Brand Brand name used for several related products. Individual Brand Brand that is known by its own brand name rather than by the name of the company producing it or an umbrella covering similar items Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Extension The decision to use a popular brand name for a new product entry in an unrelated product category Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Brand Strategy 1.The decision to use a popular brand name for a new product entry in an unrelated product category. a) Family b) Individual 2.Private Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. National Brand (Manufacturer’s Brand) A brand promoted and distributed by a manufacturer. Private A brand promoted and distributed by a wholesaler or retailer Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Generic Products Food and household staples characterized by plan labels, little or no advertising, and no brand names Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Purposes for Packaging 1. Protection against damage, spoilage, and pilferage 2. Assistance in marketing the product 3. Cost-effectiveness Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Label The part of the package that contains: 1. The brand name or symbol 2.The name and address of the manufacturer or distributor 3.Information about product composition and size 4.Information about recommended uses of the product Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. A code readable by optical scanners that can print the name of the item and the price on the cash register receipt. 10 Universal Product Code Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. 1. Convenience 2. Preference 3. Shopping 4. Specialty 5. Unsought 10 Consumer Goods Classification: Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Products that are lowest in terms of both effort and risk. 10 Convenience Products Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Products that are slightly higher on the effort dimension and much higher on risk than convenience products. 10 Preference Products Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Products that are usually purchased only after the consumer has compared competing products. 10 Shopping Products Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Products that are highest in both effort and risk, due to some unique characteristics that cause the buyer to prize that particular brand. 10 Specialty Products Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Products that people may know about but normally do not purchase. 10 Unsought Products Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. 10 Figure A Strategic Classification of Products Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. 10 Managerial Implications of Classifying Products Strategically (1 of 2) Table a Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Managerial Implications of Classifying Products Strategically (1 of 2) 10 Table b Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. 1. Installations 2. Accessory Equipment 3. Component Parts and Materials 4. Raw Materials 5. Supplies and MRO Items 10 Classifying Business-to-Business Products: Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Major capital assets that are used to produce products and services. 10 Installations Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Second-level capital items that are used in the production of products and services but are usually less expensive and shorter-lived than installations. 10 Accessory Equipment Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. A wholesaler that operates in the business-to-business goods market and typically handles small accessory equipment and operating supplies. 10 Industrial Distributor Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Finished business-to-business goods that actually become part of the final product. 10 Component Parts and Materials Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Raw Materials Farm products (such as cattle, wool, eggs, milk, pigs, and canola) and natural products (such as coal,copper, iron ore, and lumber) Marketing the Total Product: Brand, Image, Warranty, and Packaging

Chapter Copyright © 2003 by Nelson, a division of Thomson Canada Limited. Supplies and MRO Items Supplies Regular expense items necessary in the daily operation of a firm, but not part of its final product. MRO Items Business-to-business supplies, so called because they can be categorized as maintenance items, repair items, and operating supplies Marketing the Total Product: Brand, Image, Warranty, and Packaging