1. Examining The Marketing Mix
LECTURE WEEK 3
Examining The Marketing Mix

2. Chapter questions
What marketing strategies are appropriate at each stage of the product life cycle?
What are the implications of market evolution for marketing strategies?
What are the characteristics of market products and how do marketers classify products?

3. Chapter questions (continued)
How can companies differentiate products and manage its product mix and product lines?
How can companies use packaging, labelling, warranties, and guarantees as marketing tools?

4. Lessons from product life cycles
Products (market offerings) have a limited life.
Sales pass through distinct stages, each posing different challenges, opportunities and problems to the seller.
Profits rise and fall at different stages of the product life cycle.
Products require different marketing, financial, manufacturing, purchasing and human resource strategies at each stage.
View this video clip about the product life cycle:

5. Long-range product life cycle
Figure Long range product market expansion strategy (P1 product 1; M1 market 1)

6. Growth-slump-maturity pattern
Figure Common product life-cycle patterns

7. Cycle-recycle pattern
Figure Common product life-cycle patterns (continued)

8. Scalloped pattern
Figure Common product life-cycle patterns (continued)

9. Style-shaped PLC
Figure (a) Style, (b) fashion and (c) fad life cycles

10. Fashion-shaped PLC
Figure (a) Style, (b) fashion and (c) fad life cycles (continued)

11. Fad-shaped PLC
Figure (a) Style, (b) fashion and (c) fad life cycles (continued)

12. Why be first in a market? Industrial age environment
Natural monopolies
Bias toward winners
In this video: Coca-Cola’s European Market Director argues his company’s case for fast new product development.

13. Long-range product market
Figure Long-range product market expansion strategy (pi = product i; mj = market j)

14. Strategies to sustain rapid market growth
Improve product quality and add new product features and improved styling.
Add new models, accessory items and personalising options.
Enter new market segments.
Increases its distribution coverage and enters new distribution channels.
Shifts from product-awareness advertising to product-preference advertising.
Lowers prices to attract the next layer of price- sensitive buyers.

15. Phase in the maturity stage of the PLC
Growth maturity
Stable maturity
Decaying maturity

16. Ways to increase sales volume
Table Alternative ways to increase sales volume

17. Product modifications possible
Quality
Feature
Style

18. Marketing programme modifications
Prices
Distribution
Advertising
Sales
Personal selling
Services

19. Design options for emerging markets
Design the new product to meet the preferences of one of the corners of the market – a single niche strategy.
Launch two or more products simultaneously to capture two or more parts of the market – a multiple-niche strategy.
Design the new product for the middle of the market – a mass-market strategy.

20. Market fragmentation
Figure Market fragmentation and market consolidation strategies

21. Market consolidation
Figure Market fragmentation and market consolidation strategies (continued)

22. What is a product?
A product is anything that can be offered to a market to satisfy a want or need, including physical goods, services, experiences, events, persons, places, properties, organisations, information and ideas.

23. Figure 14.6 Components of the market offering

24. Figure 14.7 Five product levels

25. Product classification schemes
Durability
Tangibility
Use

26. Durability and tangibility
Nondurable
goods
Durable
goods
Services

27. Consumer goods classification
Convenience
Shopping
Specialty
Unsought

28. Industrial goods classification
Materials and parts
Capital items
Supplies/
business services

29. Product differentiation
Form
Features
Customisation
Performance
Conformance
Durability
Reliability
Repairability
Style

30. Service differentiation
Ordering ease
Delivery
Installation
Customer training
Customer consulting
Maintenance and repair
Returns

31. The product hierarchy Item Product type Product line Product class
Product family
Need family

32. Product systems and mixes
Product mix
Product assortment
Depth
Length
Width
Consistency

33. Product systems and mixes (continued)
Product mix
Product assortment
Depth
Length
Width
Consistency

34. Product line analysis Core product Staples Specialties Convenience
items

35. Figure 14.8 Product item contributions to a product line’s total sales and profits

36. Product map
Figure Product map for a paper product line Source: B. P. Shapiro (2003) Industrial product policy: managing the existing product line, Cambridge, MA: Marketing Science Institute (Report No ). Copyright © Reproduced with permission from Marketing Science Institute and Benson P. Shapiro

37. Line stretching
Down-market stretch
Up-market stretch
Two-way stretch

38. Pruning
Pruning weak brands can strengthen the remaining brands in the line
Pruning slow-selling brands from product lines often benefits the brands that are left, such as Unilever’s global bestsellers including Lipton worldwide or Persil in the United Kingdom Source: Martin Meissner/AP Wide World Photos

39. Product-mix pricing Product-line pricing Optional-feature pricing
Captive-product pricing
Two-part pricing
By-product pricing
Product-bundling pricing

40. What is the 5th P?
Packaging, sometimes called the 5th P, is all the activities of designing and producing the container for a product.
Packaging must protect goods effectively be attractive to consumers and look good. View this fun video clip to appreciate the important role of packaging:

41. Factors contributing to the emphasis on packaging
Self-service
Consumer affluence
Company/brand image
Innovation opportunity

42. Packaging objectives Identify the brand
Convey descriptive and persuasive information
Facilitate product transportation and protection
Assist at-home storage
Aid product consumption

43. McDonald’s environmentally friendly packaging
McDonald’s burger and fries cardboard packaging is environmentally friendly. Source: mediablitzimages UK Ltd/Alamy

44. Functions of labels
Identifies
Grades
Describes
Promotes

45. Recap: can you explain?
What marketing strategies are appropriate at each stage of the product life cycle?
What are the implications of market evolution for marketing strategies?
What are the characteristics of market products and how do marketers classify products?

46. Recap: can you explain? (continued)
How can companies differentiate products and manage its product mix and product lines?
How can companies use packaging, labelling, warranties, and guarantees as marketing tools?