10product mix

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Chapter 10


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1 What is a product

2 Brand and trademark

3 Product line decision

4 Product life-cycle

5Development strategies of Newproduct

Chapter 10 Product mix strategy

In this chapter, we focus on 5In this chapter, we focus on 5

parts:parts:


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1 What is a product1 What is a product

1.1 Definition

1.2 Levels of product

1.3 Product classifications

1.4 Physical product

1.5 Product mix



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1.1 Definition1.1 Definition


(1) Defined in GB/T19000

results or outcomes of act, work, produce

and labor physical product

no other than this activities such as an

action, a work, a production or labor

invisible produce or service.


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1.1 Definition1.1 Definition(2) Defined by Philip Kotler

Anything that can be offered to a market for attention,

acquisition, use, or consumption that might satisfy a want

or need.

Physical products Properties

Services Information

Persons Organizations

Places Experiences

Ideas



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1.2 Levels of product1.2 Levels of product

core

benefit



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1.3 Product classifications1.3 Product classifications(1) Consumer productsConvenience products

Shopping productsSpecially productsUnsought products

(2) Industrial productsMaterial and PartSupplies and Business serviceCapital items



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(3) Durability and Tangibility

Non-durable goods

Durable goods

Services

1.3 Product classifications1.3 Product classifications



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1.5 Product mix1.5 Product mix

The set of all product lines and items that aparticular seller offers for sale.Width:the number of different product lines the

company carries.Length:the total number of items the company

carries within its product lines.

Depth:the number of variants offered of eachproduct in the line.

Consistency:how closely related the various productlines are in end use, production requirements,distribution channels, or some other way.



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2 Brand and Trademark

2.1 What is brand and trademark

2.2 Level of brand loyalty2.3 Brand Equity

2.4 Brand strategy



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2.1 What is brand2.1 What is brand

and trademarkand trademark

2.1.1 Brand

(1) Definition:A name,term,sign,symbol,or

design,or a combination of these,thatidentifies the maker or seller of a product or

service.



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2.1 What is brand2.1 What is brandand trademarkand trademark

2.1.1 Brand

(2)The function of the brand

A brand is essentially a seller`s promise toconsistently delivery a specific set of

features, benefits, and services to the

buyers.The best brands convey a warranty of

quality.



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2.1.1 Brand

(3) A brand can convey up to six levels ofmeaning

Attributes Culture

Benefits PersonalityValues User



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2.1.2 Trademark

Trade mark a pattern or a design for use by

somebody in particular its registered inbrand-mark bureau or knowledge property

right management department, and preserved

by legal regulations.The brand and trademark are important industrial

property of the enterprise which can be

negotiated.



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2.22.2 Level of brand loyaltyLevel of brand loyalty

Customer will change Brands, especially for

price reasons. No customer loyalty.Customer is satisfied. No reasons to change.

Customer is satisfied and would incur costs by

changing brand.Customer value the brand and sees it a friend.

Customer is devoted to the brand.



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2.32.3 Brand EquityBrand EquityThe company will enjoy reduced marketing costs because

of the high level of consumer brand awareness andloyalty.

The company will have trade leverage in bargaining withdistributors and retailers since customers expect them tocarry the brand.

The company can charge a higher price than itscompetitors because the brand has higher perceived

quality.The company can more easily launch brand extension

since the brand name has high credibility.

The brand offers the company some defense against fierceprice competition.



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2.4 Brand strategy2.4 Brand strategy

Manufacturer brand

Distributor brand

Licensed brand

Line extensionsBrand extension

Multi-brands

New brands

(1)Brand sponsor (2)Brand strategy



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Line extension Brand extension

Multi-brands New brands

(3)Product category

Brand

name

Existing new

Existing

new




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(4)Brand Name Decision

Individual Brand Name

Blanket family Name For All ProductSeparate Family Names For All Products

Company Trade Name Combined With

Individual Product Names




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(4)Brand Name DecisionIt should suggest something about the products benefits;

It should suggest product qualities;

It should be easy to pronounce, recognize, and remember;

It should not carry poor meanings in other countries and language.Interesting stories: AIDS;Eastern Wind means wind come from

Siberia, Santana ;Passat means dead in Shanghai dialect;Nova inSpanish means can't go, etc.




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3 Product line decision

3.1 Product line define

3.2 Product line analysis3.3 Product line length

3.4 Product line modernization3.5 Product line characteristicization



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3.1 Product line definedefineA group of products that are closely

relates because they perform a similar

function, are sold to the same customer

groups, are marketed through the same

channels, or fall within given price

ranges.



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3.1 Product line definedefine


Example:

m

2

1

n

2

1

1 k


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3.2 Product line analysisanalysis

Sales volume and profitLine manager of products should know

sales amount and profit of the project ofthe products.

Market position and prospect

Line manager of products shouldanalyses how the one's own products linemade a reservation .



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3.3 Product line lengthlengthline stretchingStretch line downward

Stretch line upwardStretch line both ways

line filling

Reasons: reaching for extra profits Satisfying dealers using excess capacity Being the leading full-line company Pluggingholes to keep out competitors



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3.4 Product line modernizationmodernization

Pay attention to two points

The question is that a products lineshould be modernized gradually or

modernized quickly

choose the best opportunity ofimproving the products , not too late

either too early



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3.5 Product line characteristicization

The line manager of products chooses one

or minority produce having models in the

products line to sell with characteristic.Low-grade products----make it serve as"

cheap goods which opens up the sale".

High end products----In order to improvethe grade of the products line



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4 product life-cycle4 product life-cycle

4.1 Definition of Product life-cycle

4.2 Five distinct stages

4.3 Product life-cycle strategies



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4.1 Definition of Product life-cycle4.1 Definition of Product life-cycle

the period of a type/kind of product is being manufactured andsold lastingly. It lasts from R&D, trial production and selling toceasing production and selling because of lack of enoughconsumer or appearance of replacements or competitive product.

product life-cycle usually includes five distinct stages as R&D,introduction, growth, maturity, decline.



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4.2 Five distinct stages4.2 Five distinct stagesProduct development

IntroductionGrowth

Maturity

Decline



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4.2 Five distinct stages4.2 Five distinct stages

Sales

Profits

Sales and

profits

($)

Losses-

investment ($)

Product

develo-

pment Introduction

Growth

Maturity

Decline

0 Time



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4.3 Product life-cycle4.3 Product life-cycle

strategiesstrategies(1)Introduction Rapid-skimming strategies

Slow-skimming strategies

Rapid-penetration strategies

Slow-penetration strategies

In a word, a manager must stress on accurate.



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strategiesstrategies(2) Growth Improve product quality and add newproduct features and models

Enter new market segments and new

distribution channelsIn a word, a manager must stress on

splendid.



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strategiesstrategies(3)Maturity Modify the market---trying to increase the consumption of the

current productModify the product---changing characteristics such as

quality,features,or style to attract new users and to inspire more

usage

Modify the market mix---improving sales by changing one or

more marketing mix elements

In a word, a manager must stress on strive for.



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strategiesstrategies(4) Decline Identify their aging products in the decline stage by

reviewing sales,market shares,costs,and profitsDecide whether to maintain,harvest,or drop each of these

declining products

Reduce various costs and hope that sales hold up or sell itto other firms

In a word, a manager must stress on transform.



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5 Development strategies of new5 Development strategies of new

productproduct (1) Definition of new product:

a product that can bring consumer new satisfactionand benefits.

For examples:New type/kind of product

Improved product: function increased, performanceimproved, structure changed, advanced techniques applied,

and so onNew packed product

New brand product

etc.


h d


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(3) New product development method

Independence development: to depend on owncapabilities

Development based on techniques from else

corporation or based on import technologyDevelopment cooperated with each other

Combined those


5 Development strategies of new5 Development strategies of new

productproduct

10product mix

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