Products and Services Based on Marketing: An Introduction, 6th edition by Philip Kotler & Gary Armstrong April 16, 2017 Product and Services Strategies

Product and Services Strategies Something that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or a need. April 16, 2017 Product and Services Strategies

Product and Services Strategies April 16, 2017 Product and Services Strategies

Three levels of product April 16, 2017 Product and Services Strategies

Core, Actual and Augmented Product Customers perceive the Sony camcorder as a complex bundle of tangible and intangible features and services that deliver a core benefit - A convenient, high-quality way to capture important moments. April 16, 2017 Product and Services Strategies

Product Classifications Consumer Products Industrial Products April 16, 2017 Product and Services Strategies

Product and Services Strategies Consumer Products Products bought by final consumers for personal consumption April 16, 2017 Product and Services Strategies

Product and Services Strategies Consumer Products April 16, 2017 Product and Services Strategies

Product and Services Strategies Industrial Products Products bought by individuals and organizations for further processing or for use in conducting business. April 16, 2017 Product and Services Strategies

Product and Services Strategies Industrial Products Materials and parts Capital items Supplies and services. Materials and parts are raw materials (wheat, cotton, livestock,fruits, vegetables, fish lumber, crude petroleum, iron ore) and manufactured materials (iron, cement, wires, small motors, tires, castings): proce and service are the amjor marketing factors Capital items are industrial products that aid in the buyer’s production or operations, such as factories, offices (major equipment), generators, drill presses, large computer sistems, elevators, hand tools, lift trucks, fax machines... Supplies and services are lubricants, coal, paper, clips, pencils, paint, nails, brooms, and window cleaning, computer repair, legal, management consulting, advertising... April 16, 2017 Product and Services Strategies

Individual Product Decisions April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Attributes Product Quality Product Features Product Design April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Quality Two dimensions: Performance Conformance In performance terms: Rolls-Royce is better than Ford Rolex is better than Timex In conformance terms: Rolls-Royce quality is as consistent as Ford quality Rolex quality is as consistent as Timex quality Quality level that matches target needs and the quality levels of competing products Consistently deliver the quality that customers pay for and expect April 16, 2017 Product and Services Strategies

Product Quality for Motorola “Quality means the world to us” TQM - Total quality management Improve customer value April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Features Stripped down Added features Feature value to customer vs. Feature cost to the company April 16, 2017 Product and Services Strategies

Product Style and Design Style + Performance Bose, B&O, Braun Falar do exemplo da lanterna de Black & Decker April 16, 2017 Product and Services Strategies

Product and Services Strategies Brand A name, term, sign, symbol, or design, or combination of these, intended to identify the goods or services of one seller or group of sellers and differentiate them from those of its competitors Nike, Philips April 16, 2017 Product and Services Strategies

Product and Services Strategies Powerful Brand Names April 16, 2017 Product and Services Strategies

Product and Services Strategies Branding April 16, 2017 Product and Services Strategies

Product and Services Strategies April 16, 2017 Product and Services Strategies

Product and Services Strategies Brand Equity The value of a brand based on the extent to which it has high brand loyalty, name awareness, perceived quality, strong brand associations, and other assets such as patents, trademarks and channel relationships. IBM $17 bn, Coca-cola $39 bn Marlboro$39 bn, Kodak $12 bn April 16, 2017 Product and Services Strategies

Product and Services Strategies Brand Name Selection Brand Name should: Suggest something about the product benefits and qualities: Duracell Be easy to pronounce, recognize, and remember: TIDE Be distinctive: Kodak, Shell April 16, 2017 Product and Services Strategies

Product and Services Strategies Brand Name Selection Brand Name should: ‘work’ in languages used in target markets Be ‘registerable’ April 16, 2017 Product and Services Strategies

Brand Owner (or Sponsor) Manufacturer’ Brand Brand created and owned by the producer of a product or a service. Ex: IBM, Kellogg Manufactures have to pay Slotting fees Private Brand or (middleman, distributor or store brand) Brand created and owned by a reseller of a product or service. Ex: Continente, Pingo Doce April 16, 2017 Product and Services Strategies

Product and Services Strategies Licensing Looney Tunes generates more than $1 bn annually April 16, 2017 Product and Services Strategies

Product and Services Strategies Co- Branding The practice of using established brand names belonging to different companies on the same product Philips & Whirlpool, Credit card issued by Ordem dos Engenheiros & American Express April 16, 2017 Product and Services Strategies

Product and Services Strategies Brand Strategy April 16, 2017 Product and Services Strategies

Product and Services Strategies Line Extension Using a successful brand name to introduce additional items in a given product category under the same brand name Classic vs. Diet Coke Danone vs. Corpos Danone April 16, 2017 Product and Services Strategies

Product and Services Strategies Brand Extensions Using a successful brand name to launch a new or modified product in a new category. Honda motorbikes, cars, and outboard engines (for boats) April 16, 2017 Product and Services Strategies

Product and Services Strategies Multibrands A strategy under which a seller develops two or more brands in the same product category: Philips & Ariston Toyota & Lexus VW & Skoda April 16, 2017 Product and Services Strategies

Product and Services Strategies New brands The same manufacturer but different brands for different products: Philips & Signaal (for defense) April 16, 2017 Product and Services Strategies

Product and Services Strategies Packaging Includes design and production of: Primary container Secondary container Shipping container Primary container Tube holding the Colgate toothpaste Secondary container = Cardboard box containing the tube Shipping container = Box containing six dozen tubes (of, say, Colgate toothpaste) April 16, 2017 Product and Services Strategies

Product and Services Strategies Packaging Packaging supports sales by: Attracting buyer’s attention Promoting the product Describing the product (legal requirements) Average supermarket which stocks 15,000 to 17,000 shopper passed by some 300 items per minute and 53% of all the purchases are made from impulse. Campbell Soup Company estimates that the average shopper sees its familiar red and white can 76 times a year creating the equivalent of $26 millions worth of advertising (ref 16) April 16, 2017 Product and Services Strategies

Packaging concept or strategy Packaging strategy states: What the package should be, or What the package should do for the product. Decisions must be made on specific aspects, including size, shape, materials, color, text and brand name. Must be consistent with the product advertising, pricing and distribution. Must be childproof April 16, 2017 Product and Services Strategies

Product and Services Strategies Labeling Identifies brand: Sunkist oranges Identifies grade Describes benefits Uses attractive graphics April 16, 2017 Product and Services Strategies

Product and Services Strategies Labeling Checklist for essential information: Unit price Use-by date Nutritional value Low fat, light, high fiber Often regulated by law April 16, 2017 Product and Services Strategies

Product-Support Services Services that augment actual products More and more companies use product-support services as a major tool in gaining competitive advantage. An active customer service department creates customer satisfaction and loyalty and helps the company find ways to distinguish itself from competitors. April 16, 2017 Product and Services Strategies

Product-Support Services Whirlpool, Procter& Gamble use 1-800 numbers Cadillac holds regular focus-group interviews with owners. Cadillac has learned that buyers are very upset by repairs that are not done correctly the first time. As a result the company has set up a system directly linking each dealership with a group of 10 engineers who can help walk mechanics trough difficult repairs April 16, 2017 Product and Services Strategies

Product-Support Services Estimate the cost and the benefit of product-support services April 16, 2017 Product and Services Strategies

Product Line Decisions A group of products that are closely related because they function in a similar manner, are sold to the same customer groups and marketed through the same type of outlets, or fall within given price ranges. April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Line Length Number of items in the product line. Companies looking for high market share and growth usually carry longer lines. Companies looking for short-term profit generally carry shorter lines of selected items. April 16, 2017 Product and Services Strategies

Increasing Product Line Length Stretching. Downward or upward Xerox stretched downwards with the small copier. Filling. Solar-powered Sony Walkman line Marriott stretch .. April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Mix Decisions The set of all product lines and items that a particular seller offers for sale to buyers. April 16, 2017 Product and Services Strategies

Product Mix Selected From P&G April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Mix Decisions Line Width Number of different product lines Line length Total number of items that the company carries April 16, 2017 Product and Services Strategies

Product and Services Strategies Product Mix Decisions Line consistency How closely related the various product lines are in end use, production requirements, distribution channels, etc. Line depth Number of versions of each product. Example: Crest comes in three sizes and two formulations April 16, 2017 Product and Services Strategies

Product and Services Strategies April 16, 2017 Product and Services Strategies

Product and Services Strategies April 16, 2017 Product and Services Strategies