chapter 8 product strategy copyright © 2013 pearson canada inc

Chapter 8Product Strategy

Copyright © 2013 Pearson Canada Inc.

Visual Model

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Developing a Marketing Strategy: The Marketing Mix

Promotion(Marketing

Communications)

(Distribution)

MarketingMix

Consumeror Business Customer

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Total Product Concept


A product is “a bundle of tangible and intangible ______________________in exchange for money and other considerations.”

Package ofBenefits

• Physical product• Brand name• Service guarantee• Brand image• Warranty, etc.

Product Items, Lines, and Mixes

________________________________________

Product LineProduct Line

Product Mix/Array

Product Mix/Array

A specific version of a product that can be designated as a

distinct offering among an organization’s products.

A specific version of a product that can be designated as a

distinct offering among an organization’s products.

A group of _________________product items.

A group of _________________product items.

All products that an ___________________.

All products that an ___________________.

The Product Mix


“The _____________of products offered for sale by a company.”

A unique product offered for sale; it has a “unique selling point” or “USP.” Think SKU (Stock Keeping Unit)

A grouping of product items that have major attributes in common but they may differ in size, form or flavour.

Product Line Width and Depth


Product LineWidth

Product LineDepth

The number of product lines in the mix.

The _______________in the product line.

Proctor & Gamble Product Lines

Campbell’s Product Lines and Mix

Product Line Width and Depth


A sampling of Nestle’s depth in one product category.

The width of Nestle’s product lines embrace pet foods, baby foods, coffee, frozen meals , ice cream and frozen treats.

Product Strategy

• A number of _________________processes which include: – Creating Product Offerings and managing every

aspect of those offerings including the concept of “Brand”

– Move customers through adoption– Manage it through the Product Life Cycle– Extend the_________________

Consumer Goods – B2C


“Products and services ultimately purchased for _________________.” Consumer goods are classified into three categories:

1. Convenience Goods

2. Shopping Goods

3. Specialty Goods

Factors such as time spent on the purchase decision and the cost of the product determine a goods classification.

Industrial Goods – B2B


Branding

• Deliberately – ________________________(change) – the perceived “personality” of a product or

product line – to deliver to the customer a quality experience – and evoke a ________________– to the product or service.

Components of a Brand


The components of a brand distinguish one company’s product from another company’s product. Those components include:

1. Brand Name – The part of a brand that can be vocalized.

2. Brandmark or Logo – The part of a brand identified by a symbol or design.

3. Trademark – The part of a brand __________________so that only the owner can use it.

Co-Branding


Using the equity of one brand name to market another branded product. There are _____________________on the product.

1. Nestle ice cream uses brand names such as Rolo and Coffee Crisp (popular brands in another Nestle category).

2. Two restaurants such as Wendy’s and Tim Hortons share facilities.

Private Label Brands


Brands produced according to specifications established by the ___________________

The Think Marketing box on p. 165 demonstrates the impact of private label brands.

Packaging Strategies


The objective of a design is always to breakthrough the clutter—shelf clutter. Designers recommend several tips:

1. A brand should _______________

2. The colour should stand out in the _________________________.

3. The package should be a ______________________.

Colour and Packaging


Coca-Cola’s signature never changes and the brand owns the colour “red.”

Shape of the Package


Molson designed the Molson Canadian Cold Shot package to be relevant to young males.

The shape of the can borrowed equity from Red Bull in the energy drink market.

Molson introduced a smaller, slimmer can.

Functions of a Package


______________________________________start and end with the package.

A good package: Protects the product

Shipping and delivery Markets the product

Information/educationLegal requirements

Provides convenienceUse and storage

Meets social concerns_________________________

Brand Loyalty


“The degree of ________________________to a particular brand, product, or service.”

Question: If you are a Coca-Cola drinker, how loyal are you to the brand. Would you switch to Pepsi-Cola? Same question for Pepsi drinkers.

Stages of Brand Loyalty


Product Management

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Product management concerns three key areas:

1. The ____________________________structure for managing current products.

2. The ____________________for developing new products.

3. Dealing with changing ___________________________as products progress through their life cycles.

Organization Systems for Managing Brands


Brand Management – A brand manager is assigned responsibility for the development and implementation of marketing programs for a specific product or group of products.

Example: Brand Manager for Doritos

Category Management – A category manager is assigned responsibility for developing and implementing marketing activity for a group of products or product lines.

Example: Category Manager for all Frito Lay salty snacks (Doritos, Tostito, Lay’s, etc.).

Product Management Decisions


All aspects of the marketing mix are managed to maximize profit. Key product decisions embrace:

• _________________________

• Product Mix Expansion (_________________)

• Brand Design and Packaging

• Maintenance or Withdrawal (Product Life Cycle)

Product Mix Expansion: Applied


Dove has expanded its line from soap to become a complete personal care product line.

Product Design Change: Applied


Product design changes are a key element of Miele’s marketing strategy.

Design change has rejuvenated a mature product category.

Branding Decisions: Applied


Boston Consulting Group Product Portfolio Management Matrix

chapter 8 product strategy copyright © 2013 pearson canada inc

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