1. 12 Setting Product Strategy
MARKETING STRATEGY 12
Setting Product Strategy

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

3. Figure 12.2 Five Product Levels
Core benefit: service or benefit the customer is buying (hotel- rest & sleep)
Basic product: what is needed to offer the service or benefit (room in a hotel, package, brand)
Expected product: attributes and conditions buyers expect to get (quiet, clean, tasty food)
Augmented product: exceeds customer expectations (image)
Potential product: possible augmentations the product might offer in the future

4. Product Classification Schemes
Non durable: tangible goods normally consumed in one or few uses – consumed quickly and purchased frequently (beer, soap). Strategy – increase availability, charge small mark-up, advertize heavily.
Durability: tangible goods that normally survives many uses (clothing, appliances)
Tangibility
Use

5. Consumer Goods Classification
Convenience
Shopping
Specialty
Unsought

6. What Is a Product? Product and Service Classifications
Convenience products are consumer products and services that the customer usually buys frequently, immediately, and with a minimum comparison and buying effort
Newspapers
Candy
Fast food
Soaps

7. What Is a Product? Product and Service Classifications
Shopping products are consumer products and services that the customer compares carefully on suitability, quality, price, and style
Furniture
Cars
Appliances

8. What Is a Product? Product and Service Classifications
Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort
Medical services
Designer clothes
High-end electronics (stereo components, photographic equipment)

9. What Is a Product? Product and Service Classifications
Unsought products are consumer products that the consumer does not know about or knows about but does not normally think of buying
Life insurance
Funeral services
Blood donations
Smoke detectors

10. Industrial Goods Classification
Industrial products are products purchased for further processing or for use in conducting a business
Materials and parts
Capital items
Supplies/business services

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

12. Services Differentiation
Ordering Ease: how easy is for a customer to place an order
Delivery: how well the product or a service is delivered – speed, accuracy, care attending
Installation: work done to make the product operational in its planned location
Customer training: training the customers
Customer consulting: data, info, advices, that the seller offers
Maintenance & repair: service program for helping customers – keep purchased products in good working order

13. Packaging: The 5th P All the activities of designing and producing
the container for a product.
Three levels of materials:
Primary package: bottle
Secondary package: carton
Shipping package: carton containing
dozen of boxes

14. Packaging has been influenced by:
Self-service: increasing number of products. Tasks: attract attention, describe features, create confidence, make positive impressions
Consumer affluence: consumers are willing to pay for convenience, appearance, prestige of better packages
Company and brand image: recognition of brand or company
Innovation opportunity: unique materials and features for easy-to-open and close pack

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

16. Functions of Labels
Label identifies the product or brand, describes attributes, and provides promotion
Identifies
Describes: who made it, where it was made, when, and what it contains
Promotes: attractive graphics

17. Warranties and Guarantees
Formal statements of expected product performance by the manufacturer – repair, replacement, or refund

18. Individual Product and Service Decisions
Brand is the name, term, sign, or design, or a combination of these, that identifies the maker or seller of a product or service

19. Nature and Characteristics of a Service
Services Marketing
Nature and Characteristics of a Service
Intangibility
Inseparability
Variability
Perishability

20. Nature and Characteristics of a Service
Services Marketing
Nature and Characteristics of a Service
Intangibility refers to the fact that services cannot be seen, tasted, felt, heard, or smelled before they are purchased
Inseparability refers to the fact that services cannot be separated from their providers

21. Nature and Characteristics of a Service
Services Marketing
Nature and Characteristics of a Service
Variability refers to the fact that service quality depends on who provides it as well as when, where, and how it is provided
Perishability refers to the fact that services cannot be stored for later sale or use