1. Chapter Eight Product Strategies

2. Chapter Objectives Define and classify products.
Issues related to branding
Address product packaging and labeling issues.
Analyze dimensions of the product mix.
Describe the new product development process.
Examine the new product diffusion process.
Address the stages of the product life cycle.
Examine product portfolio management challenges.

3. Product Definition* Product Durability Durable goods Nondurable goods
A product is any offering that can satisfy consumer needs and wants.
Goods
Services
Ideas
Product Durability
Durable goods
Nondurable goods

4. The Product Mix The product mix is the complete assortment of
the products that a company offers to its target mkt.
Dimensions of the Product Mix:
Product item*: An individual, unique brand offering
Product line: Related brands in the same product category
Product length: Total number of brands in the product mix
Product width: Total number of product lines a company offers
Product depth: Number of different offerings for a product category
Product consistency: Extent to which the different product lines are related, use the same distribution channels, and have the same consumers

5. Product Classification*
Convenience goods
Impulse goods
Staples
Emergency goods
Shopping goods
Homogeneous shopping goods
Heterogeneous shopping goods
Specialty goods
Low
Willingness to Search*
High

6. Branding Branding—adds value to products
Cool Hunting #2
Branding—adds value to products
A brand (Brand name, Brand mark, Trademark)
Name, design, symbol, or a combination
Used to differentiate the product from competitors’ offerings
Brand Equity: Brand Acceptance*
Awareness - Rejection
Perceived Quality - Non-recognition
Loyalty - Recognition
Association - Preference
- Insistence
Brand Image: Consumers’ perception of a particular brand

7. Brand Identity Brand Name Protecting the Brand Easy to pronounce
Memorable
Distinctive
Suggest product traits and/or benefits
Easy to translate into other languages
Protecting the Brand
Design counterfeiting
Brand Name counterfeiting
The OCSE estimates the value of counterfeit goods alone at more than $ 450,000,000,000, approximately 10% of the world’s GDP, and growing. Many industries are affected by this phenomenon, among them luxury items, fashion, pharmaceuticals, food products, toys and mechanical components.

8. Brand Sponsor Decisions
How should a brand be sold?
Manufacturers’ brand
Private label (Dealer*, Private*) brands
Generic brands*
Branding Strategies*
Individual branding
Family branding
Licensing, Co-Branding
Minute Maid, a national brand, is offered side-by-side with the Ukrop’s private brand.

9. Packaging and Labeling
Package design considerations:
Uniqueness
Shipping and storage
Shelf appearance
Appealing to consumers
Theft and tamper proofing
Label . . .
Identifies the brand
Describes the ingredients or components
Contains an expiration date
Identifies the manufacturer and/or distributor
Promotes the product
Directs the consumer on product use
Benefits*
- Traditional
Communication
Perception
Function

10. New Product Development: Stages
get happy
Idea generation
Screening new product ideas
Developing & evaluating product concepts
Performing product business analyses
Designing and developing new product
Test marketing
Launch (commercialization)
2008 New Products

11. New Product Diffusion Factors Influencing Diffusion of Innovation*
1. Relative Advantage Compatibility 3. Complexity
4. Possibility of Trial Observability/Communicability
Explanations (Media, People)*
Description (Adopter Categorization)
1. Innovators Late Majority
2. Early Adopters Laggards
3. Early Majority
Coming Soon

12. Product Life Cycle: Strategy
Length and Shape*
Product/Service Features
Managerial Actions*
Stage Management*
Note “Extending the Product Life Cycle”

13. Managing the Product Portfolio
The product portfolio is defined as the totality of products managed by the company as separate businesses.
Strategic Frameworks*
Product Portfolio Analysis
Build, Hold, Entrench, Harvest, Divest, Abandon
Product-Market Opportunity Matrix
Profit Impact of Market Strategy (PIMS)
Others

14. Product Portfolio Analysis
High
Market Share
Low
High
Star
Question
Mark
 Industry growth rate 
Dog
Cash
Cow
Low

15. Product-Market Opportunity Matrix
Old
New
Old
Product
Development
Market Penetration
Market
Market
Development
New
Diversification