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You should be able to:
1. Define product and the major classifications of
products and services
2. Describe the decisions companies make regarding
their individual products and services, product
lines, and product mixes
3. Discuss branding strategyƜthe decisions companies
make in building and managing their brands
4. Identify the four characteristics that affect the
marketing of a service and the additional marketing
considerations that services require

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|
 is anything that can be offered in a

market for attention, acquisition, use, or
consumption that might satisfy a need or
want
ƥ Soap
ƥ Toothpaste

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 is a form of product that consists of
activities, benefits, or satisfactions offered
for sale that are essentially intangible and
do not result in ownership
ƥ Doctorƞs exam
ƥ Legal advice

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#$%   represent what buying the product

or service will do for the customer
ƥ Disney

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ƥ Core benefits
ƥ Actual product
ƥ Expected product
ƥ Augmented product

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&
  ' represent what the buyer is really buying

r %
 represents the design, brand name, and

packaging that delivers the core benefit to the customer

#$%  %
represents the attributes & features

consumers expect in the product

r(  %
 represents additional services or

benefits of the actual product

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ƥ Consumer products
ƥ Industrial products

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&
( %
 are products and

services for personal consumption
ƥ Classified by how consumers buy them
ƥ Convenience product
ƥ Shopping products
ƥ Specialty products
ƥ Unsought products

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&

  %
 are consumer
products and services that the customer
usually buys frequently, immediately, and
with a minimum comparison and buying
effort
ƥ Newspapers
ƥ Candy
ƥ Fast food
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%%%
 are consumer products

and services that the customer compares
carefully on suitability, quality, price, and
style
ƥ Furniture
ƥ Cars
ƥ Appliances
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%  %
 are consumer products and

services with unique characteristics or brand
identification for which a significant group of buyers
is willing to make a special purchase effort
ƥ Medical services
ƥ Designer clothes
ƥ High-end electronics

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)
%
 are consumer products

that the consumer does not know about or
knows about but does not normally think of
buying
ƥ Life insurance
ƥ Funeral services
ƥ Blood donations
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  %
 are products purchased for

further processing or for use in conducting a
business

Classified by the purpose for which the product is

purchased
ƥ Materials and parts
ƥ Capital
ƥ Raw materials

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!    %  include raw materials

and manufactured materials and parts
usually sold directly to industrial users
ƥ Wheat
ƥ Lumber
ƥ Iron
ƥ Cement
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& %  (are industrial products that aid

in the buyerƞs production or operations
ƥ Buildings
ƥ Elevators
ƥ Computers

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  * 
( " consists of

activities undertaken to create, maintain, or
change attitudes and behavior of target
consumers toward an organization

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| 
( " consists of activities

undertaken to create, maintain, or
change attitudes and behavior of target
consumers toward particular people
ƥ Donald Trump

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|  ( " consists of activities

undertaken to create, maintain, or change
attitudes and behavior of target consumers
toward particular places
ƥ Tourism

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R   
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 ( " is the use of commercial

marketing concepts and tools in programs
designed to influence individualsƞ behavior
to improve their well-being and that of
society
ƥ Public health campaign
ƥ Tourism

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ƥ Product attributes
ƥ Branding
ƥ Packaging
ƥ Labeling
ƥ Product support services

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    are the benefits of the

product or service
ƥ Quality
ƥ Features
ƥ Style and design

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Quality in terms of the product or service is the

lack of defects

Quality in terms of the customer is the value

and satisfaction provided by the product or
service

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Product quality includes level and consistency

ƥ o 
 is the level of quality that
supports the productƞs positioning
ƥ | '
(  +  is the ability of a
product to perform its functions

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o 
  is the freedom from

defects and the delivering of a targeted level
of performance

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'   are a competitive tool for

differentiating a product from competitorsƞ
products

Product features are assessed based on the

value to the customer versus the cost to the
company

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Product style and design add value to

customer value

 describes the appearance of the

product

 contributes to a productƞs
usefulness as well as to its looks
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 is the name, term, sign, or design, or

a combination of these, that identifies the
maker or seller of a product or service

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Consumer benefits
ƥ Quality
ƥ Consistency
Seller benefits
ƥ Segmentation
ƥ Communicate product features
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| "  involves designing and producing

the container or wrapper for a product

á   identifies the product or brand, describes

attributes, and provides promotion

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Product support services augment actual products

Companies must continually:

ƥ Assess the value of current services to obtain ideas
for new ones
ƥ Assess the costs of providing these services
ƥ Develop a package of services to satisfy customers
and provide profit to the company

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 is 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

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  is the number of items in

the product line
ƥ Line stretching
ƥ Line filling

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   is when a

company lengthens its product line
beyond its current range
ƥ Downward
ƥ Upward
ƥ Combination of both

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,, %
   is used by

companies at the upper end of the market to plug a
market hole or respond to a competitorƞs attack

)%, %
   is by companies at

the lower end of the market to add prestige to their
current products

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&
( 
   is used by

companies in the middle range of the
market to achieve both goals of upward and
downward line stretching

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 ' occurs when companies

add more items within the present range of
the line
ƥ More profits
ƥ Satisfying dealers
ƥ Excess capacity
ƥ Plugging holes to fend off competitors
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($consists of all the products and

items that a particular seller offers for sale
ƥ Width
ƥ Length
ƥ Depth
ƥ Consistency
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($,is the number of different

product lines the company carries

|
($  is the total number of

items the company carries within its product
lines

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!$ % is the number of versions

offered of each product in the line

&
  is how closely the various product

lines are in end use, production
requirements, or distribution channels

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  represents the consumerƞs perceptions

and feelings about a product and its
performance. It is the companyƞs promise to
deliver a specific set of features, benefits,
services, and experiences consistently to the
buyers

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  + is the positive differential

effect that knowing the brand name has
on customer response to the product or
service

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Brand equity provides competitive advantage

ƥ Consumer awareness and loyalty
ƥ Benefits
ƥ Beliefs and value

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&
(  + is the value of the customer

relationships that the brand creates

 
 
 is the process of estimating
the total financial value of the brand

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Brand strategy decisions include:

ƥ Brand positioning
ƥ Brand name selection
ƥ Brand sponsorship
ƥ Brand development

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Brand strategy decisions include:

ƥ Product attributes
ƥ Product benefits
ƥ Product beliefs and values

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Desirable qualities
ƥ Suggests benefits and qualities
ƥ Easy to pronounce, recognize, and
remember
ƥ Distinctive
ƥ Extendable
ƥ Translatable for the global economy

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ƥ Manufacturerƞs brand
ƥ Private brand
ƥ Licensed brand
ƥ Co-brand

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Private brands provide retailers with

advantages
ƥ Product mix control
ƥ Slotting fees for manufacturersƞ
brands
ƥ Higher margins
ƥ Exclusivity
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ƥ Line extensions
ƥ Brand extensions
ƥ Multibrands
ƥ New brands

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á  $ 
 occur when a company

extends existing brand names to new forms,
colors, sizes, ingredients, or flavors of an
existing product category

  $ 
 extend a brand name to a

new or modified product in a new category

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!  are additional brands in the same

category

ü ,  are used when existing brands

are inappropriate for new products in new
product categories or markets

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Requires:
ƥ Continuous brand communication
ƥ Customer-centered training
ƥ Brand audits

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ƥ Government
ƥ Private not-for-profit organizations
ƥ Business services

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ƥ Intangibility
ƥ Inseparability
ƥ Variability
ƥ Perishability

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 refers to the fact that services

cannot be seen, tasted, felt, heard, or
smelled before they are purchased

 %  refers to the fact that services

cannot be separated from their providers

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-  refers to the fact that service

quality depends on who provides it as well
as when, where, and how it is provided

|   refers to the fact that services

cannot be stored for later sale or use

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In addition to traditional marketing strategies,

service firms often require additional
strategies
ƥ Service-profit chain
ƥ Internal marketing
ƥ Interactive marketing

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 .%
'  links service firm profits with
employee and customer satisfaction
ƥ Internal service quality
ƥ Satisfied and productive service employees
ƥ Greater service value
ƥ Satisfied and loyal customers
ƥ Healthy service profits and growth

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  ( " means that the service firm must

orient and motivate its customer contact employees
and supporting service people to work as a team to
provide customer satisfaction

Internal marketing must precede external marketing

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( " means that service
quality depends heavily on the quality of the
buyer-seller interaction during the service
encounter
ƥ Service differentiation
ƥ Service quality
ƥ Service productivity

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!  
 ''  
 creates a
competitive advantage from the offer,
delivery, and image of the service
ƥ '' can include distinctive features
ƥ  
 can include more able and reliable
customer contact people, environment, or
process
ƥ (  can include symbols and branding

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!  
 +  provides a
competitive advantage by delivering
consistently higher quality than its
competitors

Service quality always varies depending on

interactions between employees and
customers

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Service recovery can turn disappointed

customers into loyal customers
ƥ Empower employees
ƥ Responsibility
ƥ Authority
ƥ Incentive

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Managing service productivity refers to

the cost side of marketing strategies
for service firms
ƥ Employee recruiting, hiring, and
training strategies
ƥ Service quantity and quality strategies

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