Chapter 12 Setting the Product and Branding Strategy

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Chapter 12 Setting the Product and Branding Strategy

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Kotler on Marketing
The best way to hold customers is to constantly figure out how to give them more for less.

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Chapter Objectives
In this chapter, the following topics will be covered:
Product Characteristics and Classifications Product Differentiation Services Differentiation Product & Brand Relationships Packaging, Labeling, Warranties and Guarantees

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Product Characteristics and Classifications
- Many people think a product is a tangible offering, but, it can be more than that. - Simply, a product is the solution of the customers’ problems. - Broadly, a product is anything that can be offered to a market to satisfy a want or need. Entities of Products: - Physical goods - Services - Experiences - Persons - Properties - Information - Events - Places - Organizations - Ideas 14-4

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Product Characteristics and Classifications

Figure : Components of the Market Offering 14-5
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Product Characteristics and Classifications

Figure: Five Product Levels
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Product Characteristics and Classifications Product levels: Customer Value Hierarchy: - In planning its market offering, the marketer needs to address five product levels. Each level adds more customer value, and the five constitute a customer value hierarchy. Core benefit: the service or benefit the customer is really buying. Ex: for a hotel, rest & sleep Basic product: the marketer must turn the core benefit into a basic product. Ex: a bed, bathroom, towels, desk, dresser and closet. Expected product: a set of attributes and conditions buyers normally expect when they purchase the product. Ex: a clean bed, fresh towels, working lamps. 14-7

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Product Characteristics and Classifications Product levels: Customer Value Hierarchy: Augmented product: a set of attributes and conditions that exceeds customers expectations. Ex: a separate room for children. Potential product: it encompasses all the possible augmentations and transformations the product or offering might undergo in the future.

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Differentiation arises and competition increasingly occurs on the basis of product augmentation, which also leads the marketer to look at the user’s total consumption system: the way the user performs the tasks of getting and using products and related services. 14-8

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Product Classifications
Durability and Tangibility: Nondurable goods: tangible goods normally consumed in one or a few uses, such as- soft drinks, soaps etc. Durable goods: tangible goods that normally survive many uses, such as- refrigerators, clothing etc. Services: intangible, inseparable, variable and perishable products. Ex- airlines, hair cuts etc. Consumer Goods Classification: The consumer usually purchases convenience goodfrequently, immediately and with a minimum of effort. Exsoft drinks, soaps, newspapers etc. It can divided into 3 categories

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Product Classifications
Staples: goods, consumers purchase on a regular basis. Ex: food items, toothpaste etc. Impulse goods: goods, that are purchase without any planning or search effort, such as- chocolates, potato chips etc. Emergency goods: goods that are purchased when a need is urgent. Ex- umbrellas & rain coats in the monsoons etc. Shopping goods: goods that consumers characteristically compares on such bases as suitability, quality, price and style. Ex: furniture etc. Specialty goods: goods that have unique characteristics or brand identification, for which, a sufficient number of buyers are willing to make a special purchasing effort. Ex – cars etc. Unsought goods: goods, about which the consumers don’t know...
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