Types of products:
Product: A good, a service, or an idea consisting of tangible and intangible features.
Non-durable goods: An item that does not last and is consumed only once, or for a limited number of times. (Food and fuel)
Durable good: A product that lasts for an extended period of time and encompasses items such as appliances, automobiles, and stereo equipment.
Service: Intangible activities, benefits, or satisfactions offered for sale. (Banking, chiropractor, doctor)
Service continuum: A range from tangible goods to intangible services. (Food is good dominant, doctor is service dominant, fast food restaurants are in the middle)
The uniqueness of services:
The four I’s of services:
- Intangibility: Cannot be tried before purchased. Important for markets to demonstrate benefits of using the services.
- Inconsistency: Services such as entertainment (blue jays game) are inconsistent because some games may be very good and others not so good.
- Inseparability: In most cases, the consumer cannot (and does not) separate the deliverer of the service from the service itself. (If a student has a problem with his teacher he cannot do anything about it).
- Inventory: Demand is inaccurate and hard to predict. Idle production capacity is expensive and arises in the service industry when a service is made available at times when there is little demand. Idle production capacity refers to when the supply of the service exceeds its demand. (To solve, part-time employees are hired by hourly rate).
The total product concept: Marketers view product as having 3 different layers;
- Core product: What the product does for the customer, the benefits derived from using it (Bicycle provides transportation and leisure activity)
- Actual product: The physical good or service, including the brand, design, and features that the consumer receives. (A bicycle is a brand product, with a metal frame, two wheels and a seat)
- Augmented product: Additional features or benefits that accompany the product, such as warranty, a service contract, delivery options, installation, or a website (Bicycle warranty or repair contract)
Packaging: A package and its label provide purchasers with detailed information and face-to-face communication at the time when purchase is being made. (Showing vivid pictures such as fruits to show what the product is made of)
Product lines and product mixes:
Product line: A group of products with the same product and brand name that are directed at the same general target market and are marketed together. (Different flavors of Gatorade). Each product line contains specific product items that can be identified by variety or size.
Product mix: The combination of product lines offered by a company. (Nike divides their products mix into 3 main categories; into shoes, clothing and equipment.) Under each category are a number of product groupings such as basketballs, watches…). The product width refers to number of different categories offered. The product depth refers to the variety of a product within a product category.
The classification of consumer and business products:
Consumer products: Products purchased for their own personal use by the ultimate consumer. (Face cream)
– Convenience products: Items purchased frequently that are inexpensive and require minimum risk and shopping effort. (Bread, newspapers…)
– Shopping products: Items that require comparison-shopping between different brands and require investment of shopping time. (Jeans, books, TV)
– Specialty products: Items for special occasions that require specific brand and considerable time and effort to purchase. (Rolex, Cruise)
– Unsought products: Unknown items or those of no interest to the purchaser. (Diapers for someone without a baby)
– The individual classifies all these goods.
Business products: Products that are purchased either to run a business or to be used as a component in another product or service. (Capital/cement mixing truck)
– Production goods: Items used in the manufacturing process that become part of the final product. (Lumber, door hinges)
– Support goods: Items used to assist in producing other goods and services. (Installations – consist of buildings and fixed equipment, accessory equipment – consist of tools and office equipment, supplies – brooms, and services – maintenance and repair, tax counsel)
Business and consumer products: Some products can be both at once depending on their usage (Printer).
Brand: A name or phrase uniquely given by a company to a product to distinguish it from the competition.
Brand equity: The favorable associations and experiences that a consumer has with a brand resulting from the consumer’s exposure and interaction with the brand over time. Brand equity is the result of considerable marketing investment and needs to be protect by the following ways:
– Patents: Legally protect new technologies, unique processes, or formulations, from usage by other companies for a period of 20 years.
– Copyrights: Used to legally protect the written word, sound recording, or form of communication from being copied by others.
– Trademarks: Used to legally protect brands and their images from usage by others.
Brand loyalty: The degree of consumer attachment to a particular brand.
Brand personality: Set of human characteristics associated with a brand name. (Consumers choose brands consistent with their self-image; gothic, sports…)
Selecting a successful brand name:
– The name should suggest the product benefits
– The name should be memorable, distinctive, and positive
– The name should fit the company or product image
– The name should have the ability to be legally protected
– The name should be simple
Types of brands:
Manufacturers brand: A brand owned and produced by the manufacturer. (Johnson & Johnson created Tylenol)
Private label brand: Otherwise known as a store brand, a brand owned by a retailer that contracts it’s manufacturing to major suppliers, and then sells the product at its own retail stores. (Shoppers drug marts life brand, which is cheaper, then Tylenol)
Generic brand: A product that has no branding and is produced as a cheaper alternative to manufacturer’s and private label brands. (Dollarstore for dishwashing soap with no brand name.
Individual brand: When a company uses a brand name solely for a specific product category. (Yoplait)
Family brand: When a company uses a brand name to cover a number of different product categories. (Crest, used for toothpaste and toothbrushes)
I’m very pleased that I am not a News Corp, shareholder! With all the on going problems it is facing in the UK with the now shut down, News of the World. Rupert Murdoch’s News Corp based in Delaware; is also confronting a legal challenge from its shareholders. Shareholders, including investment funds, labor and municipal pension funds are accusing Murdoch of misusing News Corp. assets, by handling the company like a family candy jar, which he raids whenever his appetite strikes. It looks like the trouble are just starting!