Ch 10 - Managing Successful Products, Services, and Brands Flashcards
Explain the product life-cycle concept.
The product life cycle describes the stages a new product goes through in the marketplace: introduction, growth, maturity, and decline. Product sales growth and profitability differ at each stage, and marketing managers have marketing objectives and marketing mix strategies unique to each stage based on consumer behavior and competitive factors. In the introductory stage, the need is to establish primary demand, whereas the growth stage requires selective demand strategies. In the maturity stage, the need is to maintain market share; the decline stage necessitates a deletion or harvesting strategy. Some important aspects of product life cycles are (a) their length, (b) the shape of the sales curves, and (c) the rate at which consumers adopt products.
Identify ways that marketing executives manage a product’s life cycle.
Marketing executives manage a product’s life cycle in three ways. First, they can modify the product itself by altering its characteristics, such as product quality, performance, or appearance. Second, they can modify the market by finding new customers for the product, increasing a product’s use among existing customers, or creating a new use situation for the product. Finally, they can reposition the product using any one or a combination of marketing mix elements. Four factors trigger a repositioning action. They include reacting to a competitor’s position, reaching a new market, catching a rising trend, and changing the value offered to consumers.
Recognize the importance of branding and alternative branding strategies.
A basic decision in marketing products is branding, in which an organization uses a name, phrase, design, symbols, or a combination of these to identify its products and distinguish them from those of its competitors. Product managers recognize that brands offer more than product identification and a means to distinguish their products from competitors. Successful and established brands take on a brand personality and acquire brand equity—the added value a given brand name gives to a product beyond the functional benefits provided—that is crafted and nurtured by marketing programs that forge strong, favorable, and unique consumer associations with a brand. A good brand name should suggest the product benefits, be memorable, fit the company or product image, be free of legal restrictions, and be simple and emotional. Companies can and do employ several different branding strategies. With multiproduct branding, a company uses one name for all its products in a product class. A multibranding strategy involves giving each product a distinct name. A company uses private branding when it manufactures products but sells them under the brand name of a wholesaler or retailer. Finally, a company can employ mixed branding, where it markets products under its own name(s) and that of a reseller.
Describe the role of packaging and labeling in the marketing of a product.
Packaging and labeling play numerous roles in the marketing of a product. The packaging component of a product refers to any container in which it is offered for sale and on which label information is conveyed. Manufacturers, retailers, and consumers acknowledge that packaging and labeling provide communication, functional, and perceptual benefits. Contemporary packaging and labeling challenges include (a) the continuing need to connect with customers, (b) environmental concerns, (c) health, safety, and security issues, and (d) cost reduction.
Recognize how the four Ps framework is expanded in the marketing of services.
The four Ps framework also applies to services with some adaptations. Because services cannot be patented, unique offerings are difficult to protect. In addition, because services are intangible, brands and logos (which can be protected) are particularly important. The inseparability of production and consumption of services means that capacity management is important to services. The intangible nature of services makes price an important indication of service quality. Distribution has become an important marketing tool for services, and electronic distribution allows some services to provide global coverage. In recent years, service organizations have increased their promotional activities. Finally, the performance of people, the appearance of the physical environment, and the process involved in delivering a service are recognized as central to the customer experience.
brand equity
The added value a brand name gives to a product beyond the functional benefits provided.
brand name
Any word, device (design, sound, shape, or color), or combination of these used to distinguish a seller’s goods or services.
brand personality
A set of human characteristics associated with a brand name.
branding
A marketing decision in which an organization uses a name, phrase, design, symbols, or combination of these to identify its products and distinguish them from those of competitors.
capacity management
Integrating the service component of the marketing mix with efforts to influence consumer demand.
seven Ps of services marketing
An expanded marketing mix for services that includes the four Ps (product, price, promotion, and place or distribution) as well as people, physical environment, and process.
multibranding
A branding strategy that involves giving each product a distinct name when each brand is intended for a different market segment.
multiproduct branding
A branding strategy in which a company uses one name for all its products in a product class.
off-peak pricing
Charging different prices during different times of the day or days of the week to reflect variations in demand for the service.
product life cycle
Describes the stages a new product goes through in the marketplace: introduction, growth, maturity, and decline.
