Brands, products, and services

Question 1

Four major brand strategy decisions and their definition

Answer 1

1. Brand positioning - a company establishes what attributes, benefits, beliefs, and values it wants to promote and support.
2. Brand name selection and protection - the company chooses a name and maybe a logo and a slogan, and can then copyright/trademark it so that these features become exclusive to the company.
3. Brand sponsorship - how a company chooses to boost their manufacturer’s brand, private/distributor brand, licensing, co-branding…
4. Brand development - here a company chooses how they want to develop line and brand extensions, multibrands, new brands. Some companies choose to franchise or expand, others choose to have several product/brand lines…

Question 2

The four special characteristics of a service

Answer 2

1. Service intangibility: services cannot be seen, tasted, felt, heard or smelt before they are bought. A customer has no idea if this service will satisfy their needs or wants
2. Service inseparability: a service is produced and consumed at the same time and cannot be separated from its provider.
3. Service variability: the quality of the a service may vary greatly, depending on who provided it and when, where, and how
4. Service perishability: a service cannot be stored for later sale or use

Question 3

Name and briefly explain the main stages in the product life cycle (5 stages)

Answer 3

1. Product development begins when the company finds and develops a new product idea. The company’s investment costs mount while there are no sales in this stage.
2. Introduction is a period of slow sales growth as the product is introduced in the marketplace. There are normally no profits in this stage since there are heavy expenses for product introduction and marketing.
3. Growth is a period of rapid market acceptance and increasing profits.
4. Maturity is a phase of slowdown in sales growth, the production has now achieved acceptance by most potential buyers. Profits level off or decline.
5. Decline is the last stage when sales fall off and profits drop

Question 4

What is the product life cycle?

Answer 4

A product’s life cycle can determine if it will stay on the market as a long-term product, or if it will simply be a trend with a quick peak in sales and then a steady decline.

Question 5

Define brands

Answer 5

A brand is name, term, design, symbol,
or any other feature that identifies one
seller’s good or service as distinct from
those of other sellers.

Question 6

Define brand equity

Answer 6

Brand equity is the differential effect
of brand knowledge on consumer
response to the marketing of a brand.

Question 7

Ethical issues concerning products

Answer 7

• Product safety: certain degree of acceptable risk
• Planned senescent: products do not last long time
• Deceptive packaging: oversized packaging, misleading labeling