Chapter 7 Products, services and brands

1. Define product and the main classifications of products and services.

Broadly defined, a product is anything that can be offered to a market for attention, acquisition, use
or consumption that might satisfy a want or need. Products include physical objects, but also
services, events, persons, places, orgs, ideas or mixes of these entities. Services are products that
consist of activities, benefits or satisfactions offered for sale that are essentially intangible, such as
banking, hotel, tax preparation and home repair services
Products and services fall into two broad classes based on the types of consumers that use them.
!onsumer products " those bought by final consumers " are usually classified according to the
consumer shopping habits #convenience, shopping, specialty, unsought products$. %ndustrial
products " purchased for further processing or for use in conducting a business " include materials
and parts, capital items, and supplies and services. &ther marketable entities " such as
organisations, persons, places and ideas " can also be thought of as products.
2. Describe the decisions companies make regarding their individual products and
services, product lines and mixes.
%ndividual product decisions product attributes, branding, packaging, labelling and product support
services. Product attribute decisions involve product quality, features, and style and design.
Branding decisions include selecting a brand name and developing a brand strategy. Packaging
provides many key benefits, such as protection, economy, convenience and promotion. Package
decisions often include designing labels, which identify, describe and possibly promote the product.
!ompanies also develop product support services that enhance customer service and satisfaction
and safeguard against competitors.
'ost companies produce a product line rather than a single product. ( product line is a group of
products that are related in function, customerpurchase needs or distribution channels. )ine
stretching involves extending a line downward, upward of in both directions to occupy a gap that
might otherwise be filled by a competitor. %n contrast, line filling involves adding items within the
present ranges of the line. (ll product lines and items offered to customers by a particular seller
make up the product mix. *he mix can be described by four dimensions+ width, length, depth and
consistency. *hese dimensions are the tools for developing the company,s product strategy.
. !dentif" the four characteristics that affect the marketing of a service and the
additional marketing considerations that services re#uire.
Services are characterised by four key characteristics+ intangible, inseparable, variable and
perishable. -ach characteristic poses problems and marketing requirements. 'arketers work to find
ways to make the service more tangible, to increase the productivity of providers who are
inseparable from their products, to standardise the quality in the face of variability, and to improve
demand movements and supply capacities in the face of service perishability.
.ood service companies focus attention on both customers and employees. *hey understand the
serviceprofit chain, which links service firm profits with employee and customer satisfaction.
Services marketing strategy calls not only for external marketing but also for internal marketing to
motivate employees and interactive marketing to create service delivery skills among service
providers. *o succeed, service marketers must create competitive differentiation, offer high service
quality, and find ways to increase service productivity.
$. Discuss branding strateg" the decisions companies make in building and managing their
brands.
Some analysts see brands as the major enduring asset of a company. Brands are more than just
names and symbols " they embody everything that the product or service means to consumers.
Brand equity is the positive differential effect that knowing the brand name has on customer
response to the product or service. ( brand with strong brand equity is a very valuable asset.
%n building brands, companies need to make decisions about brand positioning, brand name
selection, brand sponsorship and brand development. *he most powerful brand positioning builds
around strong consumer beliefs and values. Brand name selection involves finding the best brand
name based on a careful review of product benefits, the target market and proposed marketing
strategies. ( manufacturer has four brand sponsorship options+ it can launch a national brand, sell to
resellers who use a private brand, market licensed brands, or join forces with another company to
cobrand a product. ( company also has four choices when it comes to developing brands. %t can
introduce line extensions, brand extensions, multibrands or new brands.
!ompanies must build and manage their brands carefully. *he brand,s positioning must be
continuously communicated to consumers. (dvertising can help. /owever, brands are not
maintained by advertising but by the customers, brand experiences. !ustomers come to know a
brand through a wide range of contacts and interactions. *he company must put as much care into
managing these touch points as it does into producing ads. !ompanies must periodically audit their
brands, strengths and weaknesses. %n some cases, brands may need to be repositioned because of
changing customer preferences or new competitors.