Chapter 8: Product, Services, and Branding Strategies

Product: anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need.
Services: a form of product that consists of activities, benefits, or satisfaction, offered for sale that are essentially intangible and do not result in the ownership of anything.
As products and services become more and more commoditized, many companies are moving to a new level in creating value for their customers. To differentiate their offers, beyond simply making products and delivering services, companies are staging, marketing, and delivering memorable customer experiences.
Levels of Product & Services: (each level adds more customer value)
1. Core Benefit: it addresses the question "What is the buyer really buying?" It is the process of defining the core problem solving benefits or services that consumers seek.
2. Actual Product: developing product and service features, design, a quality level, a brand name, and packaging and other attributes combined to deliver the core product.
3. Augmented Product: providing consumer services and benefits beyond the core benefit and actual product.
Product and Service Classification: there are two broad classes of products -
1. Consumer Products: product bought for final consumption. There are several types of consumer products: convenience, shopping, specialty, and unsought products.
Marketing Considerations Convenience Shopping Specialty Unsought
Customer Buying Behavior Frequent purchase, little comparison, planning, or shopping effort. Low customer involvement Less frequent purchase, much planning and shopping effort, comparison of brands Strong brand loyalty, special purchase effort, little comparison of brands, low price sensitivity Little product awareness and no or negative interest.
Price Low Higher High Varies
Distribution Widespread distribution at convenient location Selective in a few outlets Exclusive distribution in few outlets Varies
Promotion Mass Promotion Ads and personal selling Carefully targeted promotion Aggressive ads and personal selling
Examples Toothpaste, magazines, laundry detergent TV, Furniture, clothing Luxury Goods such as Rolex watches Blood donation, insurance

2. Industrial Products: products bought by individuals and organizations for further processing or for use in conducting a business. There are three types of industrial products -
a. Materials and Parts - raw materials and manufactured materials and parts. Price and service are the major marketing factors.
b. Capital items - products that aid in production or operations. It includes accessory equipments (eg - portable heavy equipments) and installations (eg - buildings).
c. Supplies and Services - operating supplies (eg - stationery) and repairs & maintenance items (eg - nails and brooms).
Organization marketing: activities undertaken to create, maintain, or change the attitudes and behavior of target customers toward an organization.
Person marketing: activities undertaken to create, maintain, or change the attitudes and behavior towards certain people.
Place marketing: activities undertaken to create, maintain, or change the attitudes and behavior towards certain places.
Social marketing: the design, implementation, and control of programs seeking to increase the acceptability of a social idea, cause, or practice among a target group.
Product and Service Decisions
There are three levels of product decisions:
1. Product and Service Attributes
a. Product Quality - the ability of a product to perform its functions, it includes the product's overall durability, reliability, precision, ease of operation and repair, and other valued attributes. Product quality has two dimensions - level and consistency. Quality level refers to the performance standards. Consistency simply means how consistently the quality is maintained.
b. Product Features - features are a competitive tool for differentiating the company's product from competitors' products.
c. Product style and design - style is the appearance of the product. Good designs contribute to a product's usefulness as well as its looks.
2. Branding
Brand is a name, term, sign, symbol, or design, or a combination of these intended to identify the goods or services of one seller or group of sellers and differentiate them those of competitors. Brands help buyers to make a decision.
3. Packaging
The activities of designing and producing the container or wrapper for a product. Packaging has the job of attracting attention, describing a product, and making the sale.