Product Flashcards
Definition of a product
A product is anything of value that can be offered to consumers in an exchange
What does a product include
core benefit
brand name logo
actual good/service
package/label
customer service activities
warranty/guarantee
How do you classify products
-Degree of tangibility
-end user
WHat is degree of tangibility
pure tangible: goods (waterbottle)
good/service: combo (starbucks)
pure intangible: services (disney)
what are the two types of end users
Consumers (B2C): purchased by consumers for personal use
Business products (B2B): purchased by org to assist in providing product for resale.
4 categories of B2C products
Convenience products
purchased frequently, minimum effort to search and compare (toothpaste)
shopping products
compare several alternatives like price, quality (camera)
specialty products
special effort to search but less effort to compare bc it’s unique (luxury sport)
unsought products
consumer don’t know about or don’t initially want (3D printing)
Look at the table of basis of comparison
What are the product life cycle stages
R&D, introduction ,growth, maturity, decline
what are the characteristics in introduction stage
low sales, negative profits, innovative customers, few competitors, marketing objectives: create awareness
what are the characteristics in growth stage
rising sales and profits, customers: early adopters, comeptitors: growing
marketing awareness: max market share
what are the characteristics in maturity stage
peaks sales, high profit, majority customers, competitors stable, marketing objectives: max profit
what are the characteristics in decline stage
decline sales, profit, and competitors. Laggards customers.
marketing objectives: outlast competitors/ redefine product
What is the BCG matrix
market growth rate (y axis) - relative market share (x-axis)
Question marks: Products with high market growth but a low market share.
Stars: Products with high market growth and a high market share.
Dogs: Products with low market growth and a low market share.
Cash cows: Products with low market growth but a high market share.
question mark correspond to what stage
introduction
star correspond too what stage
start of growth
cash cows correspond to what stage
start of maturity stage
dogs correspond to what stage
end of maturity stage
what is a product line
a group of products that satisfy a class of
needs to the same customer group, often distributed
through the same channels
what is a product mix
sum of the product lines a company has
what is the width of product mix
the number of different line
what is the depth of product mix
number of product in each line
What is a brand formally:
a proprietary trademark for a specific product
or service
What is a brand conceptually
a “contract” between the company and
its customers; a promise of specific benefits, quality,
value, and experiences; a relationship… strongly related to positioning
characteristics of a product
tangible, easily copied, becomes irrelevant, a transaction
characteristics of a brand
intangible, cant be imitated, timeless adaptable, a relationship
what is brand equity
The added (or diminished) value that a given brand name lends
to a product beyond the core product itself
value related to brand equity
awareness
perceived value
brand associations
brand loyalty
what are the 4 brand strategies
line extension, category extension, multibranding, new brands
LOOK at table to see axis (brand name, product category)
what is line extension
new products in the same general
category that closely resemble successful products (tide)
what are the 2 types of line extensions
horizontal extensions:
keeping price and quality
consistent, but changing factors like flavor, color, or
format to differentiate the product.
vertical extensions
increasing and/or decreasing
quality and price to create lower-priced,
middle-priced, and higher-priced options
What is cannibalization
When the new extension product takes sales away from the
old product
net zero benefit to company
bad for retailers : waste shelf space on products that steal sales from one another without increasing overall sales
What is category extension
using same brand name to lunch new products in different category - Dole canned fruits, salad
How to do category extension well
transferability of company assets (two goods use same material)
complementarity of use (coffee machine, coffe pod)
functional associations (ivory shampoo: cleanness)
emotional associations
same target segment
baby good, baby clothes
What are the advantages of category extension
Enable a company to enter new categories at significantly lower cost
and risk
Reinforce positioning of parent brand
risks of category extension
Could dilute or disrupt brand image
A managerial bias:
since established brand is strong, why should we spend money
and effort promote the brand extension?
what is multi branding
like line extension, but with a different brand name. Launch several products within same market and different brand names
Advantages of multibranding
1.saturate the market: fill all price/quality gaps
2.Occupy shelf space, leaving little room for competitors.
- Cater to brand-switchers
- Generate internal competition to keep brand managers on their toes.
What is co-branding
The practice of using established brand names of
two or more companies on the same product. Credit card, bank TD, air canada
