Module 7: Products, Brands, and New Product Development Flashcards
involves managing and developing products and brands, and is a key function of marketing
product strategy
marketers need to understand how products and brands are _____ and ______ in order to develop effective marketing programs
defined
categorized
important to understand how new products are _______ and _______ by consumers
developed
adopted
goods/services or ideas consisting of tangible and intangible attributes
products
physical attributes like colour, size, material
tangible attributes
non-physical characteristics like quality, style, reliability
intangible attributes
products are divided into 3 main categories
non-durable goods
durable goods
services
consumed quickly (ex: food, gas)
non-durable goods
last for extended period of time (ex: cars and appliances)
durable goods
intangible activities, benefits, or satisfaction offered for sale (ex: baking, visits to doctor, taking vacation, going to movies)
services
often allow products to differentiate their offerings from comp while also adding value to consumers
supplementary services
offer a combination of both tangible and intangible services
middle of service continuum
means that services cannot be held, touched or seen before purchase
intangibility
means that services can vary based on the service provider and are harder to standardize
inconsistency (or variability)
means that services cannot be separated from the service provider
inseperability
the consumer is involved in the production of the service if they provide ______ or _______
guidance
feedback
means that there is fluctuating demand for services and they can’t be stored for times when demand exceeds capacity
inventory
expensive and arises when a service is available when there is little demand
Idle production capacity
formally defined as a situation when the supply of a service exceeds its demand
Idle production capacity
to deal with idle production capacity issue, the service industry uses
part-time employees
products are comprised of different elements, including (3)
- total product concept
- packaging and labelling
- product lines and mixes
marketers view products as having 3 different layers
core product
actual product
augmented product
total product concept =
core product
actual product
augmented product
the benefit a consumer derives from having the product
core product
the physical g/s and includes the product’s branding, design and features
actual product
includes the additional features, attributes that accompany a product
augmented product
warranty, service contract, delivery options, installation assistance, or an app for download are examples of
augmented product
source of competitive advantage, provides functionality, communication and reinforcement of brand image
packaging and labelling
provide a function in terms of ease of use, storage and transport
packaging and labelling
what % of food/drink purchase decisions are made at point of sale
over 75%
what % of consumers make a purchase after only examining the front pack
90%
what % of consumers make a purchase without having picked up an alternative
85%
marketers often manage products in groups based on their
similarities
group of similar products that are closely related because they satisfy a similar need and are marketed to same general target market
product line
includes all the product lines marketed by a company
product mix
in small companies the product mix might be _____, while in larger orgs it may be more _______
simple
complex
the number of different product lines offered by the company
product mix width
the number of products or brands in the product line
product line length
the number of different versions of each product sold within its product lines
product line depth
products are classified as either consumer or business products depending on their
usage
4 consumer product categories
convenience products
shopping products
specialty products
unsought products
inexpensive items that are purchased frequently with minimal shopping effort or risk
convenience products
products where the consumer comparison shops, assessing attributes and prices of different products and brands
shopping products
products are more expensive then convenience products and require more time and greater assurance of purchase saisfaction
shopping products
products that require considerable time and effort to purchase
specialty products
tend to be expensive products from specialty brands that require high purchase satisfaction
specialty products
products that the consumer does not know about or isn’t interested in purchasing
unsought products
insurance, funeral services, fire extinguisher, and insulin are examples of
unsought products
major characteristic of business products is that their sales are often the result of
derived demand
business products are classified based on their use, and include (2)
production goods
support goods/services
used in the manufacturing process
production goods
used to assist in production
support g/s
4 types of support goods and services
installations
accessory equipment
supplies
services
name or phrase uniquely given by a company to a product to identify and distinguish it in the market
brand
brands can be legally protected using (3)
patents
copyrights
trademarks
a right, granted by the gov to exclude others from making, using, or selling an invention
patents
used for protecting technologies, processes, formulations
patents
used to protect written material, music and performance
copyrights
used to protect brand names, logos, colours, etc.
trademarks
term used to describe the value of a brand that results from the favourable exposure, interactions, associations, and experiences that consumer have with a brand overtime
brand equity
degree consumers insist on purchasing a specific brand
brand loyalty
marketers try to form ______ between brands and consumers so that brand loyalty remains high
connections
association of human characteristics with a brand
brand personality
brands play a role in
economies and societies
help consumers by easing the purchase decision process, being consistent and allowing customers to quickly associate a product with a company name
brands
should be memorable, distinctive, and positive
brand name
should fit the company/ product image, suggest product benefits, be legally protected and be simple to spell
brand name
brands can be based on (3)
- product line and mix
- brand owner
- how they market the brand
brands are classified as either
individual brands
family brands
their brand name has been extended to cover more than 1 product
family brand
refers to only one product or product line
individual brands
includes a product mix with a variety of product lines
family brands
when new g/s are introduced under an existing brand name
brand extension
when g/s uses both family brand name and its own name (often used in automobile industry)
sub-brand
owned and produced by the manufacturer and are distributed through various marketing channels
manufacturer’s brand (national brands)
owned by retailers who contract their manufacturers and sell products under their own label, exclusively at their own store
private label brands
essentially unbranded products produced as cheaper altnertives to manufacturers or private label brands
generic brands
most commonly found in the pharmaceutical industry
generic brands
most important element of a brand
trustworthiness
encompasses the consistently dependable image that consumers have for a brand and fosters confidence recommending it to others
trustworthiness
encourage brand loyalty by creating interactions
engagement
brands that stand out are often unique, innovative, and forward-thinking
learning edge
brands that are caring have the ability to connect with consumers by installing pride
corporate citizenship
brands need to have a high profile with consumer and stand out from the crowd
presence
brand elements: (5)
trustworthiness engagement learning edge corporate citizenship presence
describes the stages a new product goes through in the market place
product life cycle
4 stages of the product life cycle
introduction
growth
maturity
decline
marketing objective is to create consumer awareness and get customers to try the product for first time
introduction stage
in the introduction stage, companies spend heavily on
marketing
building relationships with _____ takes time
stakeholders
characterized by increased competition and a rapid increase in sales
growth stage
profits peak during this stage
growth stage
profits peak during the growth stage as a result of (2)
economies of scale
increased demand
product and promotional efforts in the growth stage focus on
brand and product differentiation
characterized by a slow-down in growth and increased focus on price competition to differentiate products in the market
maturity stage
promotional efforts in maturity stage focus on
price
weaker competitors tend to start leaving the market at this stage
maturity stage
category sales begin to decline and many competitors fall out of the market
decline stage
little promotional support other than price discounts during this stage
decline stage
where there is an extended introductory period due to significant efforts required to educate customer on usage and benefits of product
high-learning product
short introductory stage
low-learning product
benefits of purchasing these products are self-evident and very little learning is required
low-learning products
the product life cycle is cyclical
fashion products
a product with a very short product life cycle
fad
experiences immediate rapid growth, followed by equally rapid decline (no real maturity stage)
fad
4 strategies used to extend the product life cycle
- modifying the product
- modifying the market
- repositioning a product
- introducing new product
approach used by marketers for products with strong brand equity and a loyal customer base
modifying the market
once product reaches this stage it if often in need of some newness
maturity stage
categorized depending on degree of newness involved, and how much time a consumer need to learn to use the product
new products
3 types of innovations
minor innovations
continuous innovations
radical innovations
product mods that require no adjustments by the consumer
minor innovations
marketers work to build awareness of the innovation and market along current lines
minor innovation
new products that include minor improvement but don’t require radical changes by consumers
continuous innovation
require extensive product development by the company
continuous innovation
involve the introduction of products that are entirely new to the market
radical innovation
extensive advertising and public relations efforts are often needed for these products
radical innovation
the acceptance of a new product in the market can be explained using the
adoption curve
most common approaches to product innovation are (2)
market penetration
product development
focusing on current market with existing products
market penetration
developing a new product for current consumers (existing market)
product development
targeting new markets with current products
market development
moving into new market with new products
diversification
suggests that a business attempts to grow depend on whether it markets new or existing products in new or existing markets
Ansoff Matrix
looks at new and existing markets for possible growth opportunity
Ansoff Matrix
selling the product on a limited basis to determine potential sucess
test marketing
launching the product with full sales and marketing support
commercialization
