Products, services and brands

COURSE #7

Daniela Ionita,
Associate Professor - Marketing Department
Objectives
Define product and the major classifications of
products and services

 Describe the decisions companies make

regarding their individual products and services,
product lines, and product mixes

Identify the four characteristics that affect the

marketing of services
Market offering

Market offerings
– combination of
goods, services
and experiences
offered to a
market to satisfy
a need or want.
 Three decades ago, Howard
What is a product? Schultz hit on the idea of bringing
a European-style coffeehouse to
America. He believed that people
needed to slow down, to smell the
coffee and enjoy life a little more.
The result was Starbucks.
Starbucks doesn’t sell just coffee,
it sells The Starbucks
Experience . The smells, the
hissing steam, the comfy chairs
all contribute to the ambience.
Starbucks gives customers what it
calls a “third place” away from
home, away from work – a place
for conversation and a sense of
community.

• A product is anything that can be offered to a market to satisfy

a want or need, including physical goods, services,
experiences, events, persons, places, properties, organizations,
information, and ideas. 4
Levels of product After-sale service, Warranty,
Product support, Delivery
and credit
Bicycle: Warranty or repair
contract

AUGMENTED PRODUCT
Features, Design,
Packaging, Quality level,
ACTUAL PRODUCT Brand name
Bicycle: A branded product,
with a metal frame, two
wheels, and a seat
CORE

“What is the customer really

buying?”
Bicycle: Provides
transportation and leisure
activity

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Product Convenience products
(toothpaste, magazines,
classifications laundry detergent)

Shopping products
(clothing, furniture, major
Consumer products – appliances)
bought by final
consumers for Specialty products
personal consumption. (luxury goods, high-priced
photography equipment)

Unsought products
(life insurance, preplanned
funeral services)

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Product Materials and parts (raw
materials: wheat, cotton,
classifications lumber; manufactured
materials: iron, cement, wires ;
component parts: motors, tires)

Capital items
Industrial products - (buildings, generators,
bought by individuals elevators, factory equipments)
and organizations for
further processing or
for use in conducting a
business. Supplies
(maintenance items, lubricants,
paper, pencils)

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Product decisions – individual products,
product lines and product mixes (1/3)

PRODUCT SUPPORT
BRANDING PACKAGING LABELING
ATTRIBUTES SERVICES
• Characteristics • A name, • Designing • Information • Presale or
by which term, sign, and attached to post-sale
products are design or a producing or on a activities
identified and combination the container product for which
differentiated. of these that or wrapper the purpose supplement
• Quality (level
consistency)
identifies the for a of naming it, the product
• Features maker/seller product. describing its (aid in its
• Style of a product. use, its exchange or
• Design dangers, its its
ingredients, utilization).
manufacturer
.

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Aesthetics
Global marketers
must understand
the importance of
visual aesthetics
embodied in the
color or shape of
a product, label,
or package.

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Product Decisions – individual products,
product lines and product mixes (2/3)
• Product line – a group of products that
are closely related 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.
• Product line length – number of items in
the product line (too short – if the
manager can increase profits by adding
items/ too long if the manager can
increase profits by dropping items)
• Expanding the product line:
 Product line filling: adding more items
within the product range
 Product line stretching: adding more
items beyond the product range
 downward: low-end products
 upward : high-end products
 both directions

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Product Decisions – individual products,
product lines and product mixes (3/3)
•Product mix (product portfolio) – all the product lines
and items that a particular organization offers for sale.
 Depth
Depth of a product mix pertains to the total
 Width number of variations for each product. Just
The width of a company's product
like length, companies sometimes report the
mix pertains to the number of
average depth of their product lines; or the
product lines that a company sells.
depth of a specific product line.
 Length
Product mix length pertains to the  Consistency
number of total products or items in Product mix consistency pertains to how
a company's product mix. closely related product lines are to one
another--in terms of use, production and
distribution. A company's product mix may be
consistent in distribution but vastly different
in use.
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Product mix - example
WIDTH

D
E
P
T
H

LENGTH

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Characteristics of a service

INTANGIBILITY INSEPARABILITY
Services cannot be seen, Services cannot be
tasted, felt, heard or separated from their
providers
smelled before purchase

SERVICES

VARIABILITY
Quality depends on who PERISHABILITY
provides them and when, Services cannot be stored
where and how for latter sale or use

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Service intangibility
Service inseparability
Services are produced
and consumed at the
same time and cannot be
separated from their
providers
If a service employee
provides the service, than
he becomes a part of the
service
Customers are also
playing an active role in
service delivery
Both the provider and
the customer affect the
service outcome
Service variability
 The quality of services depends on
who provides them as well as
when, where and how they are
provided
 E.g. Marriott have a reputation for
providing better services than
other hotels but even within a
given Marriott hotel one
registration-counter employee may
be cheerful and efficient whereas
another may be grumpy and slow.
 Even the quality of the same
employee’s service varies
according to his energy and frame
of mind at the time of each
customer encounter
Service perishability

 Services cannot be stored for later sale

or use (missed appointment to a
dentist)
 If demand is steady, perishability is not
a problem
 When demand fluctuates – problems!
 Service firms often design strategies for
producing a better match between
demand and supply (hotels are
charging lower prices in the off-season;
restaurants hire part-time employees
to serve during peak hours.
The service profit chain
• The chain that links service firm profits with employee and customer
satisfaction

Healthy
Satisfied service
and loyal profits and
Greater customers growth
service
value
Satisfied
and
productive
Internal service
service employees
quality

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External, internal and interactive marketing

Orienting and motivating

customer-contact
employees and supporting
service employees to
Company
work as a team to provide
customer satisfaction
Internal External
marketing marketing

Employees Customers
Training service
employees in the art of
interacting with customers
to satisfy their needs. Interactive
marketing
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Managing service Managing service Managing service
differentiation quality productivity

Offer – innovative
features Service quality is Train current
harder to define and employees better
Delivery – more
judge than a product Hire new more
able and reliable
quality skillfully
customer-contact
employees
people, superior Set high service quality
Increase the
physical standards (not 98% -
quantity of their
environment or a DPD is delivering 2.5
service by giving
superior delivery millions parcels /day up some quality
process – misdirect 50.000)
Harness the power
Images - memorable Service recovery of technology