1. CHAPTER 10 Product Concepts
Lamb, Hair, McDaniel
Chapter 9 Product Concepts
CHAPTER 10
Product Concepts
Marketing cannot be accomplished in isolation. Even though the marketing function resides with marketers, the concept of marketing must permeate the entire organization.

2. What Is a Product? Product
Chapter 9 Product Concepts
What Is a Product?
Product
Everything, both favorable and unfavorable, that a person receives in an exchange.
Tangible Good
Service
Idea

3. Core and Augmented Components of a Product
SUPPORT SERVICES COMPONENT
PACKAGING
COMPONENT
 Repair and maintenance
 Deliveries
CORE
COMPONENT
 Trademark
 Price
 Product platform
 Design features
 Functional features
 Legal
 Installation
 Quality
 Warranty
 Brand name
 Package
 Instructions
 Spare parts
 Legal
 Styling
 Other related
services
 Legal

4. Types of Products(Goods)
Chapter 9 Product Concepts
Types of Products(Goods)
Unsought
Products
Specialty
Shopping
Convenience
Consumer
Business
Notes:
Chapter 6 described seven categories of business products: (have students name these) major equipment, accessory equipment, component parts, processed materials, raw materials, supplies, and services.
Consumer products are classified into four types: convenience products, shopping products, specialty products, and unsought products. This approach organizes products by the effort used to shop for them.

5. Types of Consumer Products
Chapter 9 Product Concepts
Types of Consumer Products
Market
Development
Diversification
Increase market share among
existing customers
Attract new customers to
existing products
Introduce new products
into new markets
Create new products for
present markets
Convenience
Product
Shopping
Specialty
Unsought
A relatively inexpensive item that merits little shopping effort
A product that requires comparison shopping, because it is usually more expensive and found in fewer stores
A particular item for which consumers search extensively and are reluctant to accept substitutes
A product unknown to the potential buyer or a known product that the buyer does not actively seek
Discussion/Team Activity:
Name products and services that fall into each of the consumer product categories:
Convenience: candy, soft drinks, deodorant, aspirin, hardware, dry cleaning.
Shopping: Homogeneous shopping products such as washers, dryers, televisions. Decisions are based on the lowest-priced brand with the desired features. Heterogeneous shopping products are essentially different, for example furniture, clothing, housing, universities. Decisions are highly-individual and based on “finding the best product for me.”
Specialty: fine watches, expensive automobiles, gourmet restaurants.
Unsought: new products, insurance, burial plots, encyclopedias.

6. Distinguishing Consumer Products
Type/
Criteria
Convenience
Shopping
Specialty
Distribution
Intensive
Selective
Exclusive
Retail margin
low
medium
High
Consumer Shopping time
Purchase frequency
high
Inventory turnover
Support services

7. Product Items, Lines, and Mixes
Chapter 9 Product Concepts
Product Items, Lines, and Mixes
Product Item
Product Line
Product Mix
A specific version of a product that can be designated as a distinct offering among an organization’s products.
A group of closely-related product items.
All products that an organization sells.
Notes:
Rarely does a company sell a single product. Instead, it sells a variety of things that may be categorized into product lines and product mixes.

8. Campbell’s Product Lines and Mix
Chapter 9 Product Concepts
Campbell’s Product Lines and Mix { }
Notes:
All of Campbell’s products constitute its product mix. Each product in the product mix may require a separate marketing strategy.
In some cases, product lines and mixes share some marketing strategy components. Consider Nike’s theme, “Just Do It.”
An example of Campbell’s product lines and product mix is shown in Exhibit 9.1.
Discussion/Team Activity:
Identify a few companies with extensive product lines and product mixes. Pick one and create a matrix similar to Exhibit Evaluate the marketing strategies in use.

9. Factors Affecting the Optimum Product Mix Decision of Company
Level of market/economic development
Sales/Profit
Competition
Market characteristics
Product characteristics
Legal considerations

10. Product Modification, Repositioning, and Extension
Product Modification: quality modification, functional modification, style modification
Product Repositioning
Product Line Extension or Deletion/Contraction
Planned Obsolescence

11. Branding Concepts
A name, term, symbol, design, or combination thereof that identifies a seller’s products and differentiates them from competitors’ products.
Why branding-benefits of branding
Manufacturer’s vs. Private Brands
Individual vs. Family Brands
Co-branding
Trademark, Patent
Brand Equity
Warranties-benefits of warranties
Global Branding

12. Branding Concepts and Use
Chapter 9 Product Concepts
Branding Concepts and Use

13. Packaging and Labeling
Chapter 9 Product Concepts
Why packaging-Functions/benefits of packaging:
containing and protecting products
facilitating storage, use, convenience
facilitating recycling and reducing environmental damage
Why labeling-benefits of labeling
Information and persuasion issue
Government regulations
Notes:
A trademark is the exclusive right to use a brand or part of a brand. Others are prohibited to use without permission.
A service mark performs the same function for services.
Parts of a brand or other product identification may qualify for trademark protection. Some of the best known trademarked features include the Coca-Cola bottle and the Nike “Swoosh,” the Jeep front grille, and the Levi’s pocket tag.
Companies that fail to protect trademarks face the risk of product names becoming generic. This list includes aspirin, cellophane, thermos, monopoly, cola, and shredded wheat.
Discussion/Team Activity:
Discuss some heavily-protected product brands that are used generically in conversations. Examples might include Kleenex, Xerox, Band-Aid Brand Adhesive Bandages, etc.

14. Universal Product Codes
Chapter 9 Product Concepts
Universal Product Codes
Universal Product Codes (UPCs)
A series of thick and thin vertical lines (bar codes), readable by computerized optical scanners, that represent numbers used to track products.
Notes:
Universal product codes, often called bar codes, were first introduced in 1974.
UPCs help retailers prepare records of customer purchases, control inventories, and track sales.

15. Global Issues in Branding
Chapter 9 Product Concepts
Global Issues in Branding
Adaptations & Modifications
Global Options for Branding
One Brand Name Everywhere
Different Brand Names in Different Markets
Notes:
When entering a foreign market with an existing product a firm has three options for handling the brand name:
One brand name everywhere. Coca-Cola uses this strategy in 195 countries around the world. This strategy allows greater recognition of the product and easier promotional coordination from market to market.
Adaptations and modifications are used when the name cannot be pronounced or interpreted successfully in a different language.
Different brand names for different markets: Local brand names are used when translation or pronunciation problems occur, when the marketer wants the brand to appear to be a local brand, or when regulations require localization.

16. A confirmation of the quality or performance of a good or service.
Chapter 9 Product Concepts
Product Warranties
Warranty
Express
Implied Warranty
A confirmation of the quality or performance of a good or service.
A written guarantee.
An unwritten guarantee that the good or service is fit for the purpose for which it was sold. (UCC)

17. Ch 10: Discussion Questions
What is a product? How marketers define Core and Augmented Product?
Define the four types of consumer products. How can we classify them using various criteria? Explain.
Explain the concept of product item, product line, and product mix.
What is an optimum product mix? Explain the factors affecting optimum product mix of a company.
Define branding and explain the rationale for branding.