Final - 03 Product Policy #1

Question 1

define Marketing myopia

Answer 1

Marketing myopia = sellers make the mistake of paying more attention to the specific product they offer than to the benefits and experiences produced by these products.

Question 2

define product

Answer 2

WHAT IS A PRODUCT? → an idea, a physical good, a person, as service, event, and organization

product: Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need.

Question 3

define service

Answer 3

Service: Any activity of benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything.

— Examples
include banking, hotel services, airline travel, retail, wireless communication, and homerepair services. We will look at services more closely later in this chapter

Question 4

define convenience products (consumer products)

Answer 4

Convenience products are consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort.

Examples include laundry detergent, candy, magazines, and fast food. Convenience products are usually low priced, and marketers place them in many locations to make them readily available when customers need or want them

Question 5

define shopping products (in consumer products)

Answer 5

Shopping products are less frequently purchased consumer products and services that customers compare carefully on suitability, quality, price, and style. When buying shopping products and services, consumers spend much time and effort in gathering information and making comparisons.

Examples include furniture, clothing, used cars, major appliances, and hotel and airline services. Shopping products marketers usually distribute their products through fewer outlets but provide deeper sales support to help customers in their comparison efforts

Question 6

define specialty product (in consumer products)

Answer 6

Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort.

Examples include specific brands of cars, high-priced photographic equipment, designer clothes, and the services of medical or legal specialists.

Question 7

define unsought products (in consumer products)

Answer 7

Unsought products are consumer products that the consumer either does not know about or knows about but does not normally consider buying. Most major new innovations are unsought until the consumer becomes aware of them through advertising.
Classic examples of known but unsought products and services are life insurance, preplanned funeral services, and blood donations to the Red Cross.
By their very nature, unsought products require a lot of advertising, personal selling, and other marketing efforts.

Question 8

define product line and product line decisions.

Answer 8

Beyond decisions about individual products and services, product strategy also calls for building a product line

• Product line A group of products that are closely related (in Function, Target, Distribution, Price Range) because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges.

Question 9

define the concept of stretching in regards to product line decisions

Answer 9

A company can expand its product line in two ways: by line filling or line stretching

Stretching → Product line stretching occurs when a company lengthens its product line beyond its current range. The company can stretch its line downward, upward, or both ways. Companies located at the upper end of the market can stretch their lines downward.

Question 10

define the concept of filling in regards to product line decisions

Answer 10

Filling → A company can expand its product line in two ways: by line filling or line stretching. Product line filling involves adding more items within the present range of the line

Question 11

Define product mix decision

Answer 11

Product Mix Decisions → An organisation with several product lines has a product mix. A product mix (or product portfolio) consists of all the product lines and items that a particular seller offers for sale. A company’s product mix has four important dimensions: width, length, depth, and consistency

1 Product mix width refers to the number of different product lines the company carries

2 Product mix length refers to the total number of items a company carries within its product lines.

3 Product mix depth refers to the number of versions offered for each product in the line. Colgate toothpastes come in 16 varieties, ranging from Colgate Total, Colgate Max

4 Finally, the consistency of the product mix refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way. Colgate product lines are consistent insofar as they are consumer products and go through the same distribution channels

• Finally, the consistency of the product mix refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way. Colgate product lines are consistent insofar as they are consumer products and go through the same distribution channels
  example: Colgate’s product mix consists of four major product lines: oral care, personal care, home care, and pet nutrition. Each product line consists of several sublines. For example, the home care line consists of dishwashing, fabric conditioning, and household cleaning products. Each line and subline has many individual items. Altogether, Colgate’s product mix includes hundreds of items

Question 12

define product mix width (product mix decisions)

Answer 12

Product mix width refers to the number of different product lines the company carries

Question 13

define Product mix length (product mix decisions)

Answer 13

Product mix length refers to the total number of items a company carries within its product lines.

Question 14

define Product mix depth (product mix decisions)

Answer 14

Product mix depth refers to the number of versions offered for each product in the line.

Question 15

define the consistency of a product mix (product mix decisions)

Answer 15

the consistency of the product mix refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way.
- Colgate product lines are consistent insofar as they are consumer products and go through the same distribution channels

Question 16

define customer percieved value

Answer 16

Customer-perceived value = The customer’s evaluation of the difference between all the benefits and all the costs of a marketing offer relative to those of competing offers.

Quality of a Product = “Ability to perform its function” → AS PERCEIVED BY EACH AND EVERY CUSTOMER

quality needs to be enough to satisfy customer needs (precieved quality) looks at:

• Durability
• Reliability
• Precision
• Ease of Operation

Question 17

What are the three levels of decision making which marketers must make for a product/service?

Answer 17

Marketers make product and service decisions at three levels:

1) individual product decisions,
- product attributed
- branding
- packaging and labelling
- product support sercives
2) product line decisions,
- stretching
- filling
3) and product mix decisions
- width
- length
- depth
- consistency

Question 18

Describe the 4 different types of Individual Product Service Decisions

Answer 18

Individual Product & Service Decisions

1) Product Attributes – Developing a product or service involves defining the benefits that it will offer. These benefits are communicated and delivered by product attributes such as quality, features, and style and design
- Quality
- Features
- Design

2) Branding – Perhaps the most distinctive skill of professional marketers is their ability to build and manage brands
- Brand = A name, term, sign, symbol, design, or a combination of these, that identifies the products or services of one seller or group of sellers and differentiates them from those of competitors.
- Branding helps buyers in many ways. Brand names help consumers identify products that might benefit them.

3) Packaging & Labeling – Packaging involves designing and producing the container or wrapper for a product. Traditionally, the primary function of the package was to hold and protect the product Innovative packaging can give a company an advantage over competitors and boost sales
- Labels range from simple tags attached to products to complex graphics that are part of the packaging.. At the very least, the label identifies the product or brand, such as the name Sunkist stamped on oranges.

4) Product Support Services – Customer service is another element of product strategy. A company’s offer usually includes some support services, which can be a minor part or a major part of the total offering.
- part of the customer’s overall brand experience.

Question 19

Describe the roll of product attributes in Individual Product & Service Decisions

Answer 19

Product Attributes – Developing a product or service involves defining the benefits that it will offer. These benefits are communicated and delivered by product attributes such as quality, features, and style and design

• Quality
• Features
• Design

Question 20

define brand

Answer 20

Brand = Use of a name, term, sign, symbol (visual/auditory), design, or combination thereof intended to identify goods or services of one seller and or to differentiate them from those of competitors.
–> Brands represent consumers’ perceptions and feelings about a product and its performance—everything that the product or the service means to consumers. In the final analysis, brands exist in the heads of consumers.

Question 21

define brand equity

Answer 21

Brand equity = The differential effect that knowing the brand name has on customer response to the product or its marketing. positive brand equity derives from consumer feelings about and connections with a brand

• It’s a measure of the brand’s ability to capture consumer preference and loyalty.
• A brand has positive brand equity when consumers react more favorably to it than to a generic or unbranded version of the same product.
• It has negative brand equity if consumers react less favorably than to an unbranded version

Question 22

What are the major brand strategy decisions?

Answer 22

the major brand strategy decisions involve 
1 - brand positioning, 
2 - brand name selection, 
3 - brand sponsorship, and 
4 - brand development.

Question 23

describte the first major brand strategy decision?

Answer 23

Brand Positioning = Placing the Brand in an exclusive (different from those of competitors’) place in Consumers’ minds. → Marketers need to position their brands clearly in target customers’ minds. They can position brands at any of three levels

a) Positioning on Product Attributes
- Ariel washes your clothes. In general, however, attributes are the least desirable level for brand positioning. Competitors can easily copy attributes. More importantly, customers are not interested in attributes as such; they are interested in what the attributes will do for them.

b) Positioning on a Benefit
- Ariel gives your clothes the unique white shine you like to wear.
A brand can be better positioned by associating its name with a desirable benefit

c) Positioning on Beliefs and Values
- Washing with Ariel will make your life easier
Successful brands engage customers on a deep, emotional level.

Question 24

describe the 2nd major brand strategy decision of brand name selection.

Answer 24

Brand Naming = A good name can add greatly to a product’s success.
- Suggest something about the product, Easy to pronounce, DISTINCTIVE, Extendable, Translate easily, Capable of Registration.

process –> It begins with a careful review of the product and its benefits, the target market, and proposed marketing strategies. After that, naming a brand becomes part science, part art, and a measure of instinct. Once chosen, the brand name must be PROTECTED.
To protect their brands, marketers present them carefully using the word brand and the registered trademark symbol, as in “BAND-AID®

Question 25

describe the 3rd major brand strategy decision of brand sponsorship.

Answer 25

Brand Sponsorship = A manufacturer has four sponsorship options. Who owns the Brand: 1) Manufacturer’s Brand: Common practice where a manufacturer markets a good or family of goods under its own brand name(s). The objective is to attract and retain satisfied-customers whose loyalty may be transferred to the manufacturer's other products. (Ariel) -- The product may be launched as a national brand (or manufacturer’s brand), as when Sony and Kellogg sell their output under their own brand names (Sony Bravia HDTV or Kellogg’s Frosted Flakes). battle of the brands = national and private brands 2) Distributor Brand --(Hacendado) Or the manufacturer may sell to resellers who give the product a private brand (also called a store brand or distributor brand). - In recent times, however, an increasing number of retailers and wholesalers have created their own store brands (or private brands). Although store brands have been gaining strength for more than a decade, recent tougher economic times have created a store-brand boom 3) Licensed Brand (BMW Card) - - Most manufacturers take years and spend millions to create their own brand names. However, some companies license names or symbols previously created by other manufacturers, names of well-known celebrities, or characters from popular movies and books. For a fee, any of these can provide an instant and proven brand name. 4) Co-Brand (Ford Focus Vodafone) Co-branding occurs when two established brand names of different companies are used on the same product. Because each brand dominates in a different category, the combined brands create broader consumer appeal and greater brand equity

Question 26

define the concept of licensed brand sponsorship in branding strategies (part of strategy 3)

Answer 26

Often brand managers will enter or extend their brands into new product categories to drive strategic growth for the company. A licensing agreement allows a company (a licensee) which markets a product or service to rent a brand from a brand owner (a licensor). The responsibility of licensee’s is to produce, promote and distribute the product while the licensor gets royalties for its brand.After license branding, a licensee gets access to the logos and trademarks associated with the brands. Association with the brand gives marketing power to the licensee’s products.

Question 27

describe the 4th major brand strategy decision of brand development strategies

Answer 27

Brand Development Strategies: → A company has four choices when it comes to developing brands. It can introduce 1) line extensions, 2) brand extensions, 3) multibrands, 4) new brands.

Question 28

define line extension (step 1 in brand development strategies)

Answer 28

Line Extension: Using a successful Brand name to introduce additional items, within the Category. ~ Line extensions occur when a company extends existing brand names to new forms, colors, sizes, ingredients, or flavors of an existing product category. --> Thus, the Cheerios line of cereals includes Honey Nut, Frosted, Yogurt Burst, MultiGrain, Banana Nut, Yogurt Burst, and several other variations ~ A company might introduce line extensions as a low-cost, low-risk way to introduce new products

Question 29

define brand extension (step 2 in brand development strategies)

Answer 29

Using a successful Brand name to introduce new products from another Category. ---> Heinz pet food, Pascual cereals… A brand extension extends a current brand name to new or modified products in a NEW CATAGORY. ----> For example, Kellogg’s has extended its Special K cereal brand into a full line of cereals plus lines of crackers, fruit crisps, snack and nutrition bars, breakfast shakes, protein waters, and other health and nutrition products. A brand extension gives a new product instant recognition and faster acceptance. It also saves the high advertising costs usually required to build a new brand name

Question 30

describe step 1 in major brand strategy decisions.

Answer 30

1 ) Brand Positioning = Placing the Brand in an exclusive (different from those of competitors’) place in Consumers’ minds. → Marketers need to position their brands clearly in target customers’ minds. They can position brands at any of three levels Positioning on Product Attributes Ariel washes your clothes In general, however, attributes are the least desirable level for brand positioning. Competitors can easily copy attributes. More importantly, customers are not interested in attributes as such; they are interested in what the attributes will do for them. Positioning on a Benefit Ariel gives your clothes the unique white shine you like to wear A brand can be better positioned by associating its name with a desirable benefit Positioning on Beliefs and Values -- Washing with Ariel will make your life easier --- Successful brands engage customers on a deep, emotional level.

Question 31

planners need to think about products and services on what | three levels?

Answer 31

Each level adds more customer value. 1 - The most basic level is the CORE CUSTOMER VALUE , which addresses the question What is the buyer really buying? When designing products, marketers must first define the core, problem-solving benefits or services that consumers seek 2 - At the second level, product planners must turn the core benefit into an ACTUAL PRODUCT. ***** They need to develop product and service features, design, a quality level, a brand name, and packaging. 3 - Finally, product planners must build an AUGMENTED PRODUCT around the core benefit and actual product by offering additional consumer services and benefits. includes warranty, delivery, product support ...

Question 32

define social marketing

Answer 32

Social marketing - The use of commercial marketing concepts and tools in programs designed to influence individuals’ behavior to improve their well-being and that of society

Question 33

describe how product mix decisions along the product line help define a companies product strategy

Answer 33

These product mix dimensions provide the handles for defining the company’s product strategy. The company can increase its business in four ways. (1) It can add new product lines, widening its product mix. In this way, its new lines build on the company’s reputation in its other lines. (2) The company can lengthen its existing product lines to become a more full-line company. (3) It can add more versions of each product and thus deepen its product mix. (4) The company can pursue more product line consistency—or less—depending on whether it wants to have a strong reputation in a single field or in several fields

Question 34

define product quality (product attributes)

Answer 34

Product quality - | The characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs.

Question 35

define multi-brand in brand development strategies

Answer 35

Multibrand: Using two or more different Brands for identical or similar products, in order to Protect the “main Brand” (most profitable). -- Carrefour vs. Carrefour Discount This serves the purpose of serving more than one customer base. Companies often market many different brands in a given product category. Multibranding offers a way to establish different features that appeal to different customer segments, lock up more reseller shelf space, and capture a larger market share

Question 36

define new brand in brand development strategies

Answer 36

New Brand: Creating a New Brand to empower the Product’s appeal. A company might believe that the power of its existing brand name is waning, so a new brand name is needed. Or it may create a new brand name when it enters a new product category for which none of its current brand names are appropriate. -- For example, Toyota created the separate Scion brand, targeted toward millennial consumers

Question 37

what are the four special service characteristics that must be considered when designing a marketing program?

Answer 37

A company must consider four special service characteristics when designing marketing programs: intangibility, inseparability, variability, and perishability

Question 38

define the service characteristic of intangibility

Answer 38

Service intangibility - means that services cannot be seen, tasted, felt, heard, or smelled before they are bought. --- For example, people undergoing cosmetic surgery cannot see the result before the purchase. --- Physical goods are produced, then stored, later sold, and still later consumed. In contrast, services are first sold and then produced and consumed at the same time.

Question 39

define the service characteristic of inseparability

Answer 39

Service inseparability -- means that services cannot be separated from their providers, whether the providers are people or machines. If a service employee provides the service, then the employee becomes a part of the service. Because the customer is also present as the service is produced, provider-customer interaction is a special feature of services marketing

Question 40

define the service characteristic of variability

Answer 40

Service variability means that the quality of services depends on who provides them as well as when, where, and how they are provided. - For example, some hotels—say, Marriott—have reputations for providing better service than others

Question 41

define the service characteristic of perishability

Answer 41

Service perishability means that services cannot be stored for later sale or use. Some doctors charge patients for missed appointments because the service value existed only at that point and disappeared when the patient did not show up. The perishability of services is not a problem when demand is steady. However, when demand fluctuates, service firms often have difficult problems

Question 42

define service profit chain

Answer 42

Service profit chain - | The chain that links service firm profits with employee and customer satisfaction

Question 43

what does service marketing require outside of the traditional four p´s and external factors?

Answer 43

service marketing also requires internal marketing and interactive marketing. 1 - Internal marketing - means that the service firm must orient and motivate its customer-contact employees and supporting service people to work as a team to provide customer satisfaction. Marketers must get everyone in the organization to be customer centered 2 - Interactive marketing means that service quality depends heavily on the quality of the buyer-seller interaction during the service encounter. In product marketing, product quality often depends little on how the product is obtained. But in services marketing, service quality depends on both the service deliverer and the quality of delivery.

Question 44

define multibrand (3rd type of brand development strategy)

Answer 44

Multibrand: Using two or more different Brands for identical or similar products, in order to Protect the “main Brand” (most profitable). --> Carrefour vs. Carrefour Discount This serves the purpose of serving more than one customer base. Companies often market many different brands in a given product category. ---> For example, in the United States, P&G sells six brands of laundry detergent (Tide, Cheer, Gain, Era, Dreft, and Ivory), five brands of shampoo (Pantene, Head & Shoulders, Aussie, Herbal Essences, and Infusium 23); and four brands of dishwashing detergent (Dawn, Ivory, Joy, and Cascade). Multibranding offers a way to establish different features that appeal to different customer segments, lock up more reseller shelf space, and capture a larger market share