Product

Unit 5

Unit 5 : Course Contents

Concept and level of product
Product Classification
Product life cycle
New product development process
Individual product decision( product attributes)
Branding, Packaging, labeling
Product support services
Product line and mix decisions
Service marketing, ( Nature, and characteristics / )
Service marketing Strategies ( service profit chain)
Service differentiation, service quality and service
productivity

 Product:
Meaning and concept:
"It is a Bundle of benefits and satisfaction"
It is one of the components of marketing mix. It is the center of the
marketing operation. A product is any thing that satisfies a need or want of
customers. It is physical goods plus the services attached with the goods.
It is a set of tangible and intangible attributes including packaging, color,
price , quality, brand, plus the seller's services and reputation. A Product
is any things that can be offered to a market to satisfy a want or need. It is
every thing one receives in an exchange. Therefore products include all
entities such as Goods, services, experiences, events, properties, and
organizations, in formations, and ideas and mixes of these entities.

In the broadest sense a product is anything offered to satisfy customer

needs. Its components are design, quality, variety, features, branding,
packaging, services and warranties.
According to Philip Kotler A product is anything that can be offered to a
market to satisfy a want or need.

Key points: (attributes of the product)

Goods: Physical goods ( tangible )
Services: Intangible like airlines, train, hotels, health club, hospitals, and
engineer, sectors, teacher, and cinema theaters discos etc.
Experiences: Yoga and meditation camp etc.
Events: sports, music, business expositions.
Persons: Film stars, musicians, sport person, professionals' politician.
Places: Visit Nepal 2011 ( Tourist )
Properties: Real state, financial property, stocks and bonds.
Organization: Sony, hulas, Phillips. Enhance corporate image
Information: Distribution of information by news paper, internet, school,
college etc. they are being bought and sold as products.
Product Mix: Design / quality / features / Brand / packaging /
Shape, color, grading, size/styles, mark sign wrapper
Service / warranty/
variety
Pre/after sale, free repair, item of product

Levels of product:
Core product (Benefits) satisfaction: Here service and benefits customers buy. At the
first level there is a core benefit and essential utility attached with a product. Buyers
purchase a product for the benefit and satisfaction attached with the product. A woman
Buyers buys lipstick for solving her problems. She is not buying any chemical or
physical attributes of the product (car for prestige and cream for beautiful).
Actual product (formal products ) : the formal product is the outer part of the product
including physical and chemical attributes such as package, brand name, quality ,
styles etc. through which the product is formally recognized as a tangible item.
The expected product: At the third level there is expected product that includes a set of
attributes and conditions buyers normally expect in a product. Hotel guests expect
clean beds and bath room.
Augmented product (extra benefit): It is the totality of benefit or a hope that a persons
receive or experiences or prestige in obtaining the formal product. For example free
helmets with motorcycles, Fresh flowers in hotel rooms. Lipstick with package, quality
style etc.
Potential product: This level includes all possible augmentations and transformations
the product may undergo in future.
Key: satisfactions / utility / benefits / Attributes / feature Extra benefit

Types of Products ( Classification of Products )

Products can be classified according to their ultimate use they
can on the basis of Buying behavior:
Consumer Product
Industrial Product
Convenience
Raw Materials and parts
Shopping
Capital items
Specialty
Supplies and business services
Unsought
( Foundation goods
Entering goods :( Raw materials
Accessory equipment
Facilitating goods: (operating supplies)

1.
.

Consumer Product classification on the basis of nature:

Perishable consumer products: these product cant be stored in long time
like vegetables, fruits, meats etc.
. Non durable consumer products: These products have longer life than
perishable consumer products. For example soap, shampoo. Packaged
food and drinks etc
. Durable consumer products: consumer uses its benefits for many years.
Examples are cars, motorcycles, refrigerators, home appliances etc.
2. Consumer product classification on the basis of Buying motives:
. Necessity products: these products are bought by consumers to meet
their Psychological, safety and social needs. For example food items,
home, clinic, furniture etc.
. Luxury Products: for example expensive car, jewelry, foreign holiday
package etc.
3. Consumer product classification on the basis of buying involvement:
. High involvement products: computer, television ,cars etc
. Low involvement products: toothpaste, hair comb, tea coffee etc.
4. Buying behavior : Convenience, shopping, specialty. Unsought

Consumer Product:
They are bought by consumer for personal need, family
need, and satisfaction. They may be goods or services.
They are used by ultimate consumers. It consists food
items, cigarettes, cars etc. They can be used without
further processing. We should follow the marketing
consideration in
Convenience products: Bread, news paper, cigarettes,
sweets, salt, sugar etc. They are non durable type and
low involment in purchase.
Shopping products: Shopping goods are those goods
for which the consumer lacks sufficient information
about product alternatives. And their attributes.
( Bicycles / furniture , shoes )

 Specialty product: They are those products for which

consumers are to much brand loyal. Consumers are fully
aware of these products and their attributes prior to making a
purchase decision. The price of this product is comparatively
higher. For example technical product, Health related product
automobiles, plant and machinery color television etc.
Unsought product: Unsought products are normally grouped
under unusual type of product because such as product's
characteristics use and image mean little to the consumers.
They may be two types of unsought products (a) New
products that the consumers are not yet aware of and (b)
product that can consumers have no intention or don't want to
purchase in the first place. For example life insurance and
encyclopedias are the traditional unsought products.

Industrial products:
Industrial products are also known as business products that are to
be sold primarily for use in producing other goods or rendering
services. For example a type writer may be a consumer product if
a consumer buys it for type his personal letters or articles. But if a
retailers or wholesaler buys it to type business letter it is and
industrial product.
Foundation goods: they are the manufacturing machines that
make production possible. They consist installations / accessory
equipments / Printing machine for a press, factory building, still
mill etc. Restaurant kitchen equipment etc.
Accessory equipment: It is used in the production operations of a
firm but they are not used in the actual manufacturing process.
Life of accessory equipment is short and the prices to this
equipment become comparatively low. For example type writer
small power tool. Cash registers, delivery, trucks, calculators etc.

 Entering goods :( Raw materials): They are

the goods which are used as the ingredients or
component of product. For example cotton,
wheat, fruits, vegetables etc and Fabricating
materials are products which under automobile
tire.
Facilitating goods: (operating supplies) they
are short lived goods and services. They are
two types like operating supplies and
maintenance and repair items For example
fuel, lubricants. Paper carbon etc.

Product life cycle:

It is an attempt to recognize distinct stages in the sales
and profit history of the product. Life cycle is
depending
upon the technology changes,
competition and buyer's preferences. Products are
like living beings. They are born, live and die. Every
product has a limited life span. Different products
have different life span. Some die with in a month and
some other live for hundred of years. The PLC
analysis is conducted at the level of a product
category such as automobiles, computers, radios,
television etc. so the product life cycle is divided in to
four stages given below.

1. Introduction stage:
A period is slow sales, growth negative or low profit,
Innovator customers, few competitors, high price, high cost
of production, distribution, promotion, technological
problems in this stage product is commercially launched in
the market.
Symptoms:

Slow growth of sales

Market Pioneers buy the products
Small production level
Technological problems
Higher price
Negative profit
No competition

2. Growth stage:
Many new products fail during the introduction stage because
they can not gain buyers acceptance. Or economically and
technically unfeasible. If the product can cross the critical
stage of introduction, it enters the growth stage.
Sales increase dramatically or rapidly.
Rising profit
New buyer groups
Stable technological improvement
Slightly lower price
New market segment
Stable price and promotion on level
Growing competition.

3. Maturity stage:
In this stage many firm enter in to the market with a broad
range of products. Since the competition on price
promotion and product is at its highest peak, each and
every company as long as possible to try to maintain a
differential advantage such as low price, change product
features , extended warranty gift giving etc.
Sales and profit increase at decrease rate
Profit starts to decrease.
Tough competition
Price cuts
Market segmentation increased in the faster pace.
.Product specialization in increased in the market.

4. Decline stage:
After maturity period, saturation periods continues, the
sales of the c company go on decline and there will be
least profit or loss to the firm. As a result it be comes
very difficult for the firms to survive in the market.
Many firm quit the market in search of new
opportunities.
Declining sales / Profit
Laggard customers. (Loyal customers continue buying)
Declining competition
Increased price (loyal customers are willing to pay high
price.)
Eventually all products reach a stage of zero sales.

Process of New product Development:

New product:
*Original product or innovative products: Innovative product
like original product, it is costly riskier and time consuming. Only
10% of new products are truly innovative. Although a failure rate
of innovation is also high. Above 70% of new products fail.
*Improved products or modified products: Existing products
are modified and improved. product modification through change
quality, function and benefits. 8% of Sony's new products are
modification of existing products.
*Product imitation (copy): Imitations are products that are new
to the organization but old to the market. Sunlight soap for
sunlight soap as well as podrej for godrej. It can be developed in
the organization own laboratories by cross functional teams. 80%
of new consumer packaged goods fail in the USA. They are
mostly product imitations.

1. Generation of new product ideas:

Marketers have to collect new ideas about the product

from various sources. This can be collected through:
Consumer complaints. ( 80% in USA )
Market research / executives
Investors / Market intermediaries
Competitors
Company personnel ( Toyota employees generate 2
million ideas annually )
Sales force
Universities / Journals / Seminars
Idea people

2. Idea Screening:
It involves a preliminary elimination process in which a large
number of product ideas are screened in term of the organization's
objectives, policies, technical feasibility and financial viability. Idea
is screened through a committee formed out of the functional
manager of the organization.
Promising ideas: Carried out for further testing.
Marginal ideas: stored for future use.
Rejected ideas: Dropped altogether.
Actually the committee meets regularly and evaluated the product
ideas.
3. Concept Development:
The main tasks of marketers should be to translate product idea into
to a technically feasible and commercially feasible physical product.
More especially the marketers develop product design, packaging,
Branding, preference and technical quality testing.

4. Business analysis:
The main purpose in this stage is to collect information the
enables the marketers to determine the commercial viability
of the product, estimates sales, Revenue and cost, profit
appraisal product life vs. investment recovery and analyzed
the risk involved and competitor's analysis.
5. Concept testing:
Test marketing is to examine the performance of the product.
It is related for identification of consumer's behavior with the
attributes of the product. It is asking consumers for
evaluation of product's performances. Different techniques
are used to find out the customer's reaction.
6. Commercialization:
Once the purpose of test marketing is over, The Company
is ready to produced products in mass scale for commercial
purpose. It involves major decisions relating to timing, place,
and segments and marketing strategy for launching the
product.

Individual product decisions

Here key product areas related to a product items. It
includes decision on product attributes, branding,
packaging, labeling and support services.
1. Product attributes decision:
Designing the core benefits (values ) related to the product
offer to customers:
a. product quality decision(performance, durability, defect
less, customers satisfaction, and relationship marketing )
quality is the totality of features and characteristics of a
products or service that bear on its ability to satisfy sated or
implied needs.

 Total quality marketing: TQM is a popular

philosophy of the 1980s that emphasizes that
not only production process but also the
policies and practices of the organization as a
whole should be committed to continuous
improvement of quality. Total quality
marketing emphasizes that each marketing
activity performed by the firm such as
marketing research, sales training, advertising.
Customer service and others should conform
to the highest possible standards.

 Correctly identify the customers needs and

requirements and communicate customers
expectations appropriately to product designers.
Make sure that the customers orders are met in
time and see the customers have received proper
instruction, training and technical assistance in
the use of the products.
Gather customer complaints on the current
product and customers ideas for product or
serivce improvement and convey them to the
proper departments in the firm.

b. Product features decision: This decision involves around the

inclusion of product features on a product. Features are
differentiation factors that can be used as competitive tool
in marketing. The modern trend is towards product
conversions when a single product like a mobile phone can
function as telephone, camera, video recorder and player,
FM radio, audio recorder and data storage,
c. Product design decision: It relates to the exterior look of
the product. Here adding the beauty value of the product.
For example Hero Hondas Karizma bikes appeal to the
young generation due to its fancy design that its
performance. We have consider before designing the
products like current trend or fashion, comfort, and
performance.

Branding Strategies:
Branding:
Concept: Most of the manufacturer's and sellers use brand
names to identify their product in the market. It is a part of
a product. It is a name, term, symbol, or special design of
products. It involves using an identification features on the
product. Branding is very popular in Nepal. Branding has
started even in farm product like rice, wheat flour, cooking
oil and pulses. Licensed brands are the most selling brand
such as coca-cola, Pepsi, sprite, 7up, fantail, fruity, real in
soft drinks market. Successful brands are rare, nanglo,
NDS, surya international, shikhar, khukuri, etc.

Component of Brand
Brand Name: It is that part of the brand that can be
vocalized and includes letters, words, and number. For
example Coca-cola, 7up etc are brand name of soft
drink.
Brand mark: It is that element of the brand that cannot
be vocalized. It often appears in terms of a sign, symbol
or design, the green bottle of 7up is brand mark.
Trade mark: It is a legal designation indicating that the
owner has exclusive right to use the brand name and the
brand mark. Brand name or brand mark can be
converted into a trade mark only when they are
registered with the concern department of government

Objectives:
Containment
Identification
Protection
Promotion
Communication
Product differentiation

Importance of Branding:
Product identification and choice
Reduction in search and evaluation time
Promotion
Value building
Product positioning
Brand loyalty
Quality assurance prestige and status
Responsiveness to environmental problems

Reasons for Not Branding:

1. Nature of the product (fruits, vegetables etc )
2. Resources for promotion ( not available sufficient funds )
3. Control on supply and quality ( If control or reduce of
supply and quality it is better to sell the product unbranded )
Types of Brand:
4. Ownership ( Manufactures brands like Sony, Liril etc ) and
Distributors (for example Rebuk, Bata ) Licensed brand
( for example gold star television are assembled in Nepal by
Chaudhary Group under a licensing contract )
5. Product Line ( Corporate brand like Hulas, Honda, etc and
Family brand like Dabar, Anmol etc and individual like
Shikhar Khukuri chautari bijuli etc)

Essentials of good brand Name

Easy to say, spell and recall
Distinctiveness
Reflecting products attributes
Legally protectable
Possibility of product line extension
Possibility of use in the foreign markets

 Packaging:
It is an act of designing or producing the package for a
product. It is the process of designing the container for a
product. It includes activities required for designing the
container for a product. So a package means wrapper or
container in which a product is enclosed.
Objectives:
Containment
Identification
Protection
Promotion
Communication
Product differentiation

Levels of Packaging:
The primary packages (milk container, toothpaste )
The secondary packages ( wrapper of toilet soap, bread
or biscuits etc )
The shipping packages (cardboard box, wooden boxes
etc )
Essentials of a good Package:
1. Convenient
2. Attractive
3. Communicative
4. Economic
5. Environment friendly

Labeling:
It may be a tag or symbol or means of recognition directly
attached to the product. A label is that part of the product in
which the brand name, brand mark, information about the
product, its use ingredients, date of manufacture,
manufacturer's name and address etc appear.
Types: Brand labels (only brand name are write or stamped or
tagged ) Grade labels (fruits, eggs, food grains etc )
Descriptive labels ( explanation of use and miss use etc also )
Objectives or functions:
Identification
Description
Promotion

Product support services:

It is also known as customer services that is part of the
augmented product design. In involves designing support
services according to the needs of the target customers.
This decision involves the issue related to product
installations and training, repairs and maintenance, and
supply of spares and parts. Some companies have adopted
outsourcing strategy to provide support services.
The major support are given below:
1. Handling customer complaints
2. Credit support
3. Technical support
4. Repair and maintenance

Product Line and Mix:

Product Line decision:
It can be defined as a group of interrelated products
fulfill the needs and wants of the customers. It means a
group of closely related products. Most of the
companies' adopt product line strategy. Almost all the
companies start their businesses with short product line
and with the passes of time product line are added to
expand business operation. Product line analysis
requires analysis of total sales and profits contributed by
each item in the line. Product line strategies involve
decision regarding ling length, line modernization, line
featuring.

* Product line length: It includes total items in a product

line. Product lines tend to lengthen over time. It involves
line expansion and contraction.
a) Line expansion : New items are added in the product
line. Two method are followed for this purpose.
i) Line stretching (Trading up means adding high price
items and Trading down means adding a low price items)
ii) Line filling: More items are added within the current
price range to discourage competition or to make profit.
b) Line contraction (drop out of any loss item)
* Product Line modernization: It is done by the
businessman as per changing environment.
* Line Featuring (set high and low price items)

 Trading up:
Adding higher price item It means adding a higher
price product to a product line to attract the broader
market, which can generated better sales, better profits
and improve goodwill to the company. The company
thinks that the prestige of a high price product will help
to improve the sale of the existing lower price products.
Trading down:
It means adding lower price products to a particular
line. With the hope that the people who cannot afford
high price original products, will buy the new low price
products and they don't have to shift to another
preferred products.

 Product Mix decision:

It indicates a set of interrelated as well as diverse products offered by an

organization. It is the set of all product lines and items that particular seller
offers for sale to buyers. It is the entire collection of product lines and items
offered by and organization. It may have four dimensions like width or
breath, length, depth, and consistency.
1. Product width: It refers to the number of product lines. It can be modified
by adding or deleting a product line.
2. Product depth: It refers to the number of product items in a product line. It
can be modified by adding or deleting a product items in a product line.
3. Product length: It refers to the total number of product items in the product
mix.
4. Product consistency; It refers to how closely related the various product
lines are. Consistency can be increased by adding closely related product
lines. It can be decreased by adding unrelated product lines.

 For example:
Biscuits
Electronic
soap
services
Glucose
Television
Detergent
Hospital
Salted
Radio
Cake
School
Coconuts
Freeze
Bathing
College
Cracker
Computer
Gel
Hotel
Cream
Telephone
Shampoo
Cinema
Each in various size and price
Nepothene group of industries
Biscuits Detergent Toothpaste Polythene Plastic wares Tea
Cream Go-Go
Everest
High Density A
Taste
Glucose go-go
-----Low ,,
B
........
Thin A detergent ..........
..............
C
..........
Co-conut ........
.........
..............
D
..........
............... ..........
.........
...........
E
...........
Total product product is 15 (4+2+1+2+5+1)
Vertical is depth closely related items in a product line and width horizontal.

 In Nepal some of the organization adopting

product mix strategy includes Golchha
organization, Chaudhary Organization etc.
While deciding on the company's product mix,
the company may have the product mix
expansion strategy, product mix contraction,
Alteration of existing products strategy.

 Service product:
It may be defined as an any task performed by the
company another as the provision of any facility or as a
product. Services may or may not attach with the physical
product. For example repair and maintenance, medical
and health care, banking insurance etc. If the main goal of
the company is to provide a physical product and services
as the supplementary products. Then services become just
provisions. For example sale of a television set to a
customer and facility regarding warranty services
becomes the part of the television, warranty services are
provided to the customer when the purchases a television
set. Here services become supplementary products.

 Key :( Features)/ Natures of services

Intangibility:
Services are intangible and they can not be seen, felt,
heard, smelled and tasted before they are acquired. The only
information consumer has about the service are the promises of
satisfaction. Buyers look at tangible components such as people,
place, equipment and communication to reduce the uncertainty
factor to an acceptable level.
Inseparability
Services are normally inseparable from the service
provider. The place of production and consumption of
services are not separate. Because of the inseparability factor,
the provider-customer interaction is very important in service
marketing.

 Key :( Features)/ Natures of service products

Intangibility:
Services are intangible and they can not be seen, felt,
heard, smelled and tasted before they are acquired. The only
information consumer has about the service are the promises of
satisfaction. Buyers look at tangible components such as people,
place, equipment and communication to reduce the uncertainty
factor to an acceptable level.
Inseparability
Services are normally inseparable from the service
provider. The place of production and consumption of
services are not separate. Because of the inseparability factor,
the provider-customer interaction is very important in service
marketing.

 Perish ability:
Services are produced and consumed at the same time.
Services can not be stored for future use. Some services
providers, such as telephone companies, airlines, hotels vary
their prices according to time or seasons in order to shift the
demand from peak to off peak periods.
Variability
Services provided by different individuals and organizations
widely differ in price and quality. The price and quality of
services are dependent on who provides the services, how
they are provided and and where they are provided? Some
services providers give at home services to consumers for
higher services.

According to Philip Kotler A service is any act of

performance that one party can offer to another that is
essentially intangible and does not result in the
ownership of anything. Its production may or may not
be tied to a physical product.
Nature:
1. Lack of customer ownership
2. People based
3. Difficult pre-purchase customer evaluation
4. Time and place factor
Financial services, tourism services, transport services,
education service and communication services has
been remarkable.

Nature of service marketing:

1. Lack of customer ownership
2. Customer involvement in the production
process
3. People based
4. Difficult pre-purchase customer service
5. Time and place factor

Types of services
1. People based and equipment based services
2. Personnel and business services
3. Presence and absence of the buyers
4. For profit and non profit services

 Service Marketing Strategies:

Marketing strategy for services is not very different from
marketing strategy for goods. Service marketing also operates
under the same environmental variables as marketing for
goods. Service marketing also involves the location of target
markets through market segmentation strategy. It requires the
assistance of marketing research activities to plan the service
marketing strategy. Service is developed and planned in
similar manner as goods. Service marketing is also based on
the traditional strategies built over product, place, price and
promotion.

In service marketing, people are the critical variable as

most services are provided through human resources.
Therefore, the selection, training and motivation of employees
are the important activities in service marketing.

1. Relationship strategies:
. In service marketing there are three
major parties involved like the
company, customers, and
employees.

 External Marketing
Internal marketing
Interactive marketing

2. P7 related strategies:
Product: The service product is the main offer by the
service producer. Service may be different high quality or
low quality. Here post sales services are entertained.
Price: Pricing of services need to be based on the
perceived delivery value and perceive duality of the
services.
Promotion: In this mix the role of personal selling an
direct marketing has become highly relevant in marketing
of services,
People
Physical evidence
Process ( service differentiation etc )

3. Service Profit Chain:

1. Internal service quality: Trained employed

and high quality of work environment etc.
2. Satisfied
and
productive
employees:
motivated loyal and hard working employees
3. Greater service value:
4. Satisfied and loyal customers
5. Healthy profit and growth

4. Service differentiation
Most services are intangible and customers can not easily
judge the quality of service until they buy and use the service.
A service market also faces strong challenge to differentiate
their services from competitor's services. Customers also find
it very difficult to differentiate the services offered by various
organizations. Service differentiation is also achieved through
a difference of service delivery methodology or process.
Service provider can adopt a variety of delivery processes and
charge different prices for its services. For example restaurant
may offer Chinese, Indian or Nepalese food. Differentiation
implemented over the delivery process can contribute to build
and image for the service organization. The image can also be
used to communicate the quality of service to customers.

Service Quality:
It is the key element of customer
satisfaction and relationship. Each and every
consumer evaluate the service quality through
three important element of service marketing
as follows:
1. Outcomes ( value creation )
2. Interactions
3. Physical Evidence

Service productivity:
Service firms have major problems in enhancing their
productivity due to the involvement of people who are
influenced by the human elements of tiredness, moods, leave,
motivations and many others. Many service firms are trying
different strategies to increase their productivity levels. Which are
given below.
1. Automation ( ATM, ABBS, etc )
2. Assembly lines: Some food chains like McDonald and KFC
have adopted the assembly line approach for food production to
enhance the productivity.
3. Reduction to service quality: government hospitals have
increased the service productivity of their doctors by shortening
the time allocated for a patients check up and prescription.
4. Atmospherics ( color, furnishing, Music, TV etc )

Products Scenario in Nepal:

In Nepal by the term product most people think about a
visible or tangible product. People are still less conscious
about the services. Most marketers are unaware about the
product life cycle, so they do not analyze product life cycle
while making product related decisions. They usually follow
imitative product strategies and don't attempt for creating
innovative product. Recently both consumers and marketers
have become more conscious about branding and product
positioning. In Nepal, both product line and product line and
product mix strategies are popular among the business
communities. Like branding and product positioning,
packaging and labeling are also popular in Nepal.

 Product is considered as the heart of

marketing mix, it has greater role in
Nepalese market. But awareness among the
people regarding service product is lacking
in recent year too. Some of the service
organizations have tried to attract the
attention of the people by communicating
that the product also meant for places, ideas
and service.

In Nepal goods dominate the product concept.

Services are getting important as products. The
concept of organization as a product has been
largely lacking. Recently Golchha organization has
launched image building efforts through Hulas
brand. The consumer products dominate Nepalese
marketing, especially the convenience and shopping
products. Nepalese organizations lack research and
development base. Product modifications are
increasing. Product imitations dominate new product
development. For example Podrej steel products are
copy of Godrej etc. The new product development
process is not systematic

 Test marketing before commercialization is generally lacking. The

failure rate of new products in Nepal is high. The product lines are
expanding in Nepal. Big houses like Joyti, Colchha, and Chaudhary
Groups are constantly adding new lines Chaudhary groups have added
health, education and energy lines. So product line strategies are not
well planned. Line featuring is not emphasized. Service marketing is in
the initial stage. Although star hotels, banking sectors in Nepal have
been concerned about people and physical environment variables.
Most manufactured products are branded in Nepal. Most brands in
Nepal are individual brands. Family brands are catching up. Nepalese
marketers have started giving attention to packaging. Imitations of
Indian or Chinese packages are popular in the market. Plastics
dominate the packaging material, especially polythene bags for
consumers to carry products. They have created serious environmental
problems. Nepalese marketers have been least concerned about
labeling. The implementation of consumer protection Act since April
1998 has prescribed strict labeling requirements.

Product strategies in Nepal

Large number of companies still practice the product and selling concept.
Multinational companies focused in Marketing concept.
1. New product development:
. Very low priority
. Low budget for research and development
. Foreign licensing and franchising
. Focused in foreign collaboration.
2. Product life cycle:
. Low awareness in product life cycle
3. Product positioning:
. It is weakest area in Nepal. Most are not aware.
. Marketers would like to promote for unimportant attributes.
4. Branding:
. It has become very popular activity in Nepal
. Branding has started in farm products like rice, wheat, cooking oil, and pulses.
. Licenced brand are the most selling brands like coca-cola, Pepsi etc.

 Successful brands are Rara, Nanglo, KFC,Nanglo, Nepal dairy, Surya etc,
Growing tendency to use family name like Golchha, Hulas, chaudhary etc.
5.Packaging:
Nepalese products are found to be adequately packaged.
Manufactures have learnt to develop good package from Chinese, Thai, Malaysian,
Indian products.
Paper, Metal and glass are used for packaging.
The use of color on the packages in gradually improving over the years although red
is still found to be the dominant color.
Package designer still dont have good knowledge.
6. Labeling:
It is mandatory in Nepal but not well practiced.
Manufacturers often dont provide full information on the label as per required of
law.
7. Product line extension:
Successful companies undertake very rapid line extension in Nepal.
Care less line extension
Product lines are extended without market assessment.

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Important Questions
Define Product? Explain its classification?
What is consumer product? Explain the characteristics and types
of consumer shopping products.
How are industrial products classified? Describe the
characteristics and marketing considerations of materials and
parts.
Define product life cycle with figure?
Explain the concept and issues related to total quality marketing.
Write a short note:
Service marketing
Product mix and line
Labeling and packaging
Reasons for not branding