MARKETING MANAGEMENT 14th edition 12 Setting Product Strategy Kotler Keller

At the heart of a great brand is a great product

Anything that can be offered to a market to Product Anything that can be offered to a market to satisfy a want or need.

Levels of Product Core Benefit or Augmented Product Installation Brand Name Quality Level Packaging Design Features Delivery & Credit Installation Warranty After- Sale Service Core Benefit or Actual Product Core Product Augmented Product

Product Classification Schemes Durability Tangibility Use

Durability and Tangibility Nondurable goods Durable goods Services

Product Classifications Consumer Products Convenience Products Buy frequently & immediately Low priced Mass advertising Many purchase locations i.e Candy, newspapers Shopping Products Buy less frequently Higher price Fewer purchase locations Comparison shop i.e Clothing, appliances Specialty Products Special purchase efforts High price Unique characteristics Brand identification Few purchase locations i.e can be anything Unsought Products New innovations Products consumers don’t want to think about these products Require much advertising & personal selling i.e Life insurance, blood donation

Industrial Goods Classification Materials and parts Capital items Supplies/ business services

Product Differentiation Style Design Ordering ease Delivery Installation Customer training Customer consulting Maintenance Product form Features Performance Conformance Durability Reliability Reparability

The Product Hierarchy Item Product type Product line Product class Product family Need family

The Product Hierarchy Product line A group of products that are closely related because they may: function in a similar manner be sold to the same customer groups, be marketed through the same types of outlets fall within given price ranges Product line length Line stretching: adding products that are higher or lower priced than the existing line Line filling: adding more items within the present price range

The Product Hierarchy Product mix Also known as product assortment Consists of all the product lines and items that a particular seller offers for sale Product mix width: Number of different product lines carried by company Product line/mix depth: Number of different versions of each product in the line Product mix consistency

Line Stretching Down-Market Stretch Up-Market Stretch Two-Way Stretch

Line Filling

Packaging: The 5th P All the activities of designing and producing the container for a product.

Packaging has been influenced by… Self-service Consumer affluence Company/brand image Innovation opportunity

Innovations in Packaging

Functions of Labels Identifies Grades Describes Promotes

MARKETING MANAGEMENT 14th edition 13 Designing and Managing Services Kotler Keller

Service Any act of performance that one party can offer another that is essentially intangible and does not result in the ownership of anything; its production may or may not be tied to a physical product.

Service Sectors Private Government nonprofit Business Retail Manufacturing

Categories of Service Mix Pure tangible good Good w/ accompanying services Hybrid Service w/ accompanying goods Pure service

Continuum of Evaluation for Different Types of Products

Nature and Characteristic of a Service Intangibility Inseparability Can’t be seen, tasted, felt, heard, or smelled before purchase. Can’t be separated from service providers. Quality depends on who provides them and when, where and how. Can’t be stored for later sale or use. Variability Perishability

Physical Evidence and Presentation Place People Equipment Communication material Symbols Price

How to Increase Quality Control Invest in good hiring and training procedures Standardize the service-performance process Monitor customer satisfaction

Matching Demand and Supply Demand side Differential pricing Nonpeak demand Complementary services Reservation systems Supply side Part-time employees Peak-time efficiency Increased consumer participation Shared services Facilities for future expansion

Service-Quality Model

Determinants of Service Quality Reliability Responsiveness Assurance Empathy Tangibles

MARKETING MANAGEMENT 14th edition 9 Creating Brand Equity Kotler Keller

Brand A name, term, sign, symbol or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

The Role of Brands Identify the maker Simplify product handling Organize accounting Offer legal protection

The Role of Brands Signify quality Create barriers to entry Serve as a competitive advantage Secure price premium

Marketing Advantages of Strong Brands Improved perceptions of product performance Greater loyalty Less vulnerable to competition Less vulnerable to crises Larger margins Inelastic consumer response to price increases Elastic consumer response to price decreases Greater trade cooperation Increase in effectiveness of IMC Licensing opportunities Brand extension opportunities

Brand Promise The marketer’s vision of what the brand must be and do for Consumers. Click on the video icon to view a clip about Starbucks’ brand.

Brand Elements Brand names URLs Slogans Elements Logos Characters Symbols

Brand Elements

Brand Elements Companies often create product icons to develop an identity for their products. Many made-up creatures and personalities, such as Çelik (and now Çeliknaz), Sütaş İnek and Yumoş Ayı, are widely recognized figures in popular culture.

Brand Element Choice Criteria Memorable Meaningful Likeability Transferable Adaptable Protectible

Slogans Like a good neighbor, State Farm is there Just do it Nothing runs like a Deere Help is just around the corner Save 15% or more in 15 minutes or less We try harder We’ll pick you up Nextel – Done Zoom Zoom I’m lovin’ it Innovation at work This Bud’s for you Always low prices

Slogans Adını unutabilirsiniz, tadını asla! “Hayaaaatın tadıııı!” Farkı, fiyatı! Yok aslında birbirimizden farkımız, ama biz Osmanlı Bankası’yız. Ne biçim lastik buuu? Honda, hayat onda. Çakar çakmaz çakan çakmak. Bira bu kapağın altındadır. Citroen gelir, hayat değişir. Türkiye’nin motosikleti. Erkek sünnet olur, askerlik yapar, Permatik kullanır! Philips hayatımızı kolaylaştıracak. Kirlenmek güzeldir. Tefal, ne varsa sende var. Arçelik demek yenilik demek. Kalebodur, seramik budur.

Brand Equity The differential effect that brand knowledge has on consumer response to the marketing of that brand.

The 10 Most Valuable Brands (Source: Millward Brown) 2011 Brand Value (Billions) Apple $153 Google $115 IBM $101 McDonalds $78 CocaCola AT&T Marlboro $74 $70 $68 China Mobile $57 GE $50 ICBC $44

Arçelik New Refrigerators Four Brand Strategies Line Extension Arçelik New Refrigerators Multibrands Arçelik - Beko Brand Extension Arçelik TV-A/C New Brands OYAK - Tukaş Brand Name Existing New Product Category

MARKETING MANAGEMENT 14th edition 20 Introducing New Market Offerings Kotler Keller

Categories of New Products New-to-the-world New product lines Additions Improvements Repositionings Cost reductions

The New Product-Development Decision Process

Consumer-Adoption Process Adoption is an individual’s decision to become a regular user of a product.

Stages in the Adoption Process Awareness Interest Evaluation Trial Adoption

Adopter Categorization

Characteristics of an Innovation Relative advantage Compatibility Complexity Divisibility Communicability