Chapter 9 Flashcards
(21 cards)
3 Components of a Product
a) Core customer value – service or benefit (intangible)
b) Actual product – packaging, brand name, design, quality levels, etc.
c) Augmented product – warranties, after-sales service, etc.
Types of Products
1) Specialty Products/Services
2) Shopping Products/Services
3) Convenience Products/Services
4) Unsought Products/Services
product category
an assortment of items that the customer sees as reasonable substitutes for one another
brands
the names, terms, designs, symbols, or any other features that identify one seller’s good or service as distinct from those of other sellers
product mix
the breadth and depth of a company’s product lines
product mix breadth (variety)
the number of product lines the firm offers (oral care, dog food…)
* increase: capture new markets, increase sales and compete in new venues
* decrease: address changing market conditions or meet internal strategic priorities
product line depth
the number of product categories within a product line (toothpaste, toothbrushes…)
* increase: address changing consumer preferences or pre-empt competitors while boosting sales
* decrease: eliminate unprofitable items and refocus marketing efforts on more profitable items
Value of Branding
Facilitate Purchasing – signify a certain quality level, consumers make quick decisions
Establish Loyalty
Helps Market Value
Are Assets – trademark infringements (Tiffany’s blue box)
Protect from Competition and Price Competition
Reduce Marketing Costs
Brand Equity
= the set of assets and liabilities linked to a brand that add to or subtract from the value provided by the product or service.
Brand awareness
Perceived value
Brand associations
Brand loyalty
Brand awareness
Measures how many consumers in a market are familiar with the brand and what it stands for.
Perceived value
The relationship between a product or service’s benefits and its cost.
Brand associations
The mental links that consumers make between a brand and its key product attributes. (1 method: Brand Personality)
Brand loyalty
Occurs when a consumer buys the same brand’s product or service repeatedly over time rather than buying from multiple suppliers within the same category.
3 Brand Ownership Strategies
a) Manufacturer Brands - Brands owned and managed by the manufacturer (Nike, Mountain Dew, KitchenAid)
- the manufacturer develops, produces and invests into marketing)
b) Private-label brands - developed and marketed by a retailer and available only from that retailer (The Bay)
c) Generic - A product sold without a brand name, typically in commodities markets (salt, meat, hardware)
2 Brand Name Strategies
Family brand name: The use of a combination of the company brand name and individual brand name to distinguish a firm’s products (Kraft Foods)
Individual brand: The use of individual brand names for each of a firm’s products.
- the more the product vary in usage or performance the more likely it is that the firm should use individual brand: P&G has Bounty for paper
Brand extension
The use of the same brand name for new products being introduced to the same or new markets.
- spend less in developing consumer brand awareness
- perception will carry over to the new product (high quality)
- increase overall sales between complementary products (chips and dips)
brand dilution
when a brand extension adversely affects consumer perceptions about the attributes the core brand is believed to hold
Cobranding
The practice of marketing two or more brands together, on the same package or promotion
- credit companies (CIBC Aeroplan Visa Card)
Brand licensing
A contractual arrangement between firms, whereby one firm allows another to use its brand name, logo, symbols, or characters in exchange for a negotiated fee.
- apparel, video games; licensor and licensee
Packaging
- physical benefits
- attracts the consumer’s attention, enables products to stand out from their competitors, and offers a promotional tool
Labelling
- provide information the consumer needs for his or her purchase decision and consumption of the product.
- a lot of laws and regulations (ingredients, where it was made, instructions and safety precautions)
- a communication tool (highlight the important things)
