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Product and Brand Strategy

Chapter Questions
What is the definition of an Industrial product?

What factors influence changes in product strategy?

How marketing strategies differ at various stages of product life-cycle (PLC)? How product strategies are developed for existing products?

What is the purpose of branding and the branding

process in business marketing?

Definition of an Industrial Product

It is a physical thing and also a complex set of economic, technical, legal, and personal relationship between a buyer and a seller. Total product characteristics include: Basic properties (i.e. fundamental benefits) Enhanced properties (i.e. tangible benefits) Augmented properties (i.e. intangible benefits) (as competition increases)

Changes in Product Strategy

Product strategy is dynamic Firms change product strategy because of changes in : 1)Customer needs 2)Technology 3)Government policies / laws 4)Product life-cycle

PLC Stages and Marketing Strategies

(for innovative products new to the market)

In the Introduction stage

Market development to educate buyers Product has basic properties Promotion to create awareness Establish distribution channels Pricing is related to positioning

In the Growth Stage

Differentiate the product from competitors Promotion to remind and reinforce Increase distribution to cover more segments

Reduce price to penetrate the market.

In the Maturity Stage

Product differentiation by superior quality of product and service

Promotion to focus on superior value

Intensify distribution by entering new markets

Reduce costs to keep prices competitive

In the Decline Stage

Harvest, divest / withdraw the product, or develop a substitute product Minimize promotion and distribution to reduce

costs.
Satisfying existing customers.

Price becomes an important decision.

Developing Product Strategies for Existing Products

For this, following steps involved: (1)Evaluate existing products performance (2)Use perceptual mapping for poor performance products (3)Decide product strategies from the following alternatives Continue the product and marketing strategy Modify the product and / or change marketing strategy Drop the product Add new product or product lines

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Branding in Business Markets

What is a brand?
It is a name, symbol, design, or combination, intended to identify the goods or services of one seller and differentiate them from those of competitors. In short, a brand identities the seller.

What is a brand equity?

It is the value (or worth) of a brand

Purpose of branding
To identify and differentiate a product / service / business from its competitors

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Branding Process in Business Marketing

Yes To Brand or not to brand Brand planning and analysis Stop Brand Strategy
Brand building

Brand auditing

No

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To Brand or Not to Brand

Major factors considered:
High pressure on prices due to intense competition (strong brands get higher prices) Solution oriented marketing, make selling complex (Branding reduces complexity) Large number of similar products / services offerings (buyers can differentiate with strong brands)

Key Brand functions in B2B Markets:

Risk reduction Easy information Image creation

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Brand Planning and Analysis

Marketers should develop brand plans Key factors in brand planning: Involvement of all Brand continuity Brand creation starts with brand analysis Brand analysis is done through marketing research Marketing research gets information about: Target customers / segments Competitors External environment

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Brand Strategy
After brand analysis, brand strategies are made: Brand Hierarchy: Corporate, product, or both

Choosing Brandnames:
Persons name Nature of business Use of Acronyms Artificial / Metaphorical names

Brand Positioning : means establishing and

sustaining an intended meaning for a brand in the minds of targeted customers.

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Brand Strategy
Brand Extensions

(Continued)

Multibrand Strategy

Co-branding / Dual branding: Ingredient branding

Global Brand Strategy

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Brand Building
Focus on value propositions (V.P.) important to target customers. Make functional and performance aspects superior. Document, demonstrate, and communicate V.P. Use brand-building tools for communicationviz: personal selling, advertising, trade-shows, seminars, sponsorships, etc.

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Brand Auditing
Purpose: To find the brands strengths and
weaknesses. Should be done once in two, six, or twelve months.

The Process of brand auditing includes:

Decide audit objectives Do internal analysis Do external analysis through marketing research Analyse and interpret the data Prepare report, including brand score card, which includes brand performance Vs target customers expectations.

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Brand Score Card: It measures the performance of the brand in relation to the target customers expectations. The four components of the brand score card are as follows: The functional performance of the brand. The ease and convenience of accessing the brand. The personality of the brand. The brand value, including pricing.