FAST MOVING CONSUMER GOODS

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WHAT IS FMCG?

Fast movi g co sum r pro ucts (FMCG)is also k ow as co sum r packag goo s (CPG) Fmcg ar pro ucts that ar sold quickly and at r lativ ly low cost Th fmcg r lates to those retail goods that are generally replaced or fully used up over a short period of days, weeks or months and within one year. This contrast with durable goods or major appliances such as kitchen appliances , which are replaced over a period of several years.

WHAT IS FMCG?

Fmcg have a short shelf life , either as a result of high consumer demand Some fmcgs such as meats , fruits and vegetables , dairy products and baked goods- are highly perishable. Other goods such as alcohol , pre-packaged foods , soft drinks and cleaning products have high turnover rates.

CHARACTERISTICS OF FMCG
From the consumer perspective : o Frequent purchase o Low involvement o Low price from the marketers angle : o High volumes o Low contribution margins o Extensive distribution network o High stock turnover

WHAT IS A PRODUCT?

A product is anything that can be offered to a market for attention, acquisition, use or consumption and satisfy a want or need. Philip kotler. Products refer to tangible & intangible goods like physical objects, services,events,persons,places,organizations,ideas or combination of these. For example , cars , washing machine , soaps ,exhibitions, business schools ,etc.

WHAT ARE SERVICES?

Services are a form of product that consist of activities, benefits or satisfactions offered for sale, that are essentially intangible & do not result in the ownership of anything Examples are banking , hotel , hospitals , airlines , legal services , consultancy , etc .

LEVELS OF PRODUCT

Product have five levels , which are known as customer value hierarchy with each level adding more customer value . THE 5 BASIC LEVELS ARE :

The most basic level is the core product or core benefit. At the second level, the core benefit is turned into basic product. At the third level it becomes expected product. At the fourth level, it becomes an augmented product And finally, it becomes the potential product .

PRODUCT LEVELS
Potential product Augmented product Expected product Basic product Core benefii

RODUCT LEVELS
1.

EXAMPLE OF PRODUCT LEVEL mobile handsets Core benefit : communication Basic product :features and design- small size , sliding , flip open, etc. Quality level-excellent quality. Excepted product : looks good, light weight , easy operate , battery durable with long standby time , color display . Augmented product : with fm radio , mp3 player , camera , voice dialing etc Potential product: with internet ,e-mail , tv channels, global positioning system

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PRODUCT HIERARCHY

Product hierarchy stretches from basic needs to particular items that satisfy those needs. the hierarchy consist of 6 levels, It is explained below with the help of example of coco-cola : Need family : e.g.. Thirst Product family : e.g.. Mineral water , beer, fresh juice ,tea etc Product class : e.g.. Soft drinks Product line : e.g. . Aerated soft drinks Product type : e.g. cola drinks Item or product variant : e.g. coca cola

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CLASSIFICATION OF PRODUCTS
1.Convinence 2.shopping Consu er products 3.Speciality products 4.Unsought products products 1.Materials and parts 2.Capital ite s 3.Supplies

Industrial products

PRODUCT DECISIONS Types of product decisions

Individual product decisions

Product line decisions

Product ix decisions

INDIVIDUAL PRODUCT DECISIONS

The important product decisions involved are :
o o o o o

Product attributes Branding Packaging Labeling Product support services

PRODUCT LINE DECISIONS

Product line is a group of products that are clearly related because they function in similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or even fall within given price ranges Examples : Bata and Nike shoes , nokia and Motorola mobile phones. A company can lengthen its product line in two ways :
Product line decisions

Product line filling

Product line stretching

PRODUCT MIX DECISIONS

o o o o

Product mix decisions consist of all the product lines and items that a marketer offers for sale. For example, Hindustan lever carries a variety of product lines like cosmetics , detergents ( coffee , tea ) ,food items etc and its product mix consists of more than 1000 Product mix of a company consist of four important dimensions 1) product mix width 2) product mix length 3) product mix depth 4) product mix consistency

BRAND CONCEPTS

a brand is a name , term , sign or symbol, or design or a combination of these , that identifies the maker or a seller of a product or service.- Philip kotler Brands can be considered as the major enduring assets of the company. Brands are more than just names and symbols. They represent consumers perception and feelings about a product and its performance The real value of a strong brand is its power to capture consumer preference and loyalty.

BRAND EQUITY

Brands vary in the amount of power and value they have in the market. A powerful brand has a high brand equity. brand equity is the positive differential effect that knowing the brand name has a consumer response to the product or service. A measure of a brands equity is the extent to which customers are willing to pay more for a brand.-Philip kotler For e.g. compared to the price of rs 500/- for a unknown brand of walkman, a customer may willing to pay rs 1000 for a Philips or Sony.

BRAND STRATEGY DECISIONS

The important brand strategy decisions are as follows: 1.Brand positioning :attributes benefits beliefs & values 2.Brand name selection : - selection protection 3.Brand sponsorship :manufacturers brand private brand , licensing & co-branding 4.Brand development :- line extension brand extension multi brands & new brands.

BRAND POSITIONING

Marketers can position their brands clearly in target customers minds at 3 levels : Positioning based on product attributes is the lowest level (e.g. face cream-cleansing) A better positioning is by using the brand name with the desirable benefit to the customer. (e.g. :face cream-softer n glowing skin) Strongest brands are positioned on strong beliefs and values. (e.g. face cream-makes you more attractive ) e.g. Clearasil , halo shampoo)

BRAND POSITIONING

While positioning a brand , the marketing people have to establish a mission for the brand and a vision of what the brand must be and will do. A brand is a companys promise to deliver a specified package of features, benefits , services , and experiences to the customers.

BRAND NAME SELECTION

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Selection of a brand name starts with a careful analysis of the product and its benefits, the target market , & proposed marketing strategies. A good brand name , after all , will add greatly to a products success. The following are the desirable qualities for a brand name : The name should be suggestive of the products benefits & qualities. E.g. fair & lovely , v- guard , whirlpool It should be easy to pronounce, recognize and remember e.g. Ariel , surf , Pepsi The brand name should be distinctive e.g. Kodak , oracle , canon

BRAND SELECTION
d) It should be extendable e.g. amazon.com online bookseller expanded into this categories. e) The brand name should translate into foreign languages easily, and should not have different meanings in different languages. f) The name should be capable of registration & legal protection. for this the name should be original & not copy of the other product names.

BRAND SELECTION

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b)

After the selection is over , the brand name has to be legally protected to prevent competitors using the name . Some protected brand names become very successful & become generic names e.g. Xerox, cell phone , Vaseline. when the name of the product lines & the variety of products increase, the job of selecting a brand name becomes difficult & complicated. Some alternatives available are : Individual brand names :- Hindustan lever ltd , for e.g. gives separate brand names for its products - bathing soap linedove, hamam, lux; detergents line- rin , wheel. Family or umbrella band names :- e.g. HLLs Brooke bond for tea & coffee products, kissan for food lines,. amul is a umbrella /family brand for milk products.

BRAND LOGO SELECTION

A logo is a pictorial symbol intended to communicate with the consumers. Logo improves recognition of the product by customers. Logos can be made of anything- words, letter , pictures or graphics. examples of popular logos : 1. air India maharaja 2. ceat tyres rhino 3. amul butter girl 4. Asian paints gattu the boy

BRAND SPONSORSHIP

There are four major types of brand sponsorship options. The product could be launched as a manufacturers brand. E.g. Philips , ibm , Bajaj , amul The manufacturers may sell the product to resellers who give it a private brand name which is also known as a store brand or distributor brand. E.g. fabmall , nilgiris some manufacturers brand licensed brands. sellers of children's product use many licensed names. E.g. batman, bugs bunny, Mickey mouse Sometimes two companies join together & use co-branding with two established brand names. E.g. maruti Suzuki , Toyota kiloskar

BRAND DEVELOPMENT

Development of brands can involve 4 different strategies. they are : brand extension Line extension Product flanking Multi brands

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BRAND REJUVENATION

Brand rejuvenation is the act of adding value to the existing brand by improving product attributes & enhancing its overall appeal. The aim is to re-focus consumers attention on a existing brand Brands are re launches into new shapes, sizes, new containers, new colors as extra strong , as fresh etc Advertising appeals that the rejuvenated brand is new , super ,etc The process is just a adaption of existing brand e.g. HLLs surf became surf excel , surf ultra

BRAND REJUVENATION

BRAND RELAUNCH

Sometimes, some brands do not succeed in the market. Some brands reach declining stage after a initial success. Companies try to give the brand one more trial with some modified attributes or features & aggressive promotional campaigns. This process is called BRAND RELAUNCH. E.G. a) santoor soap of Wipro failed in the market initally. New santoor was launched , ably supported by a new promotion campaign. The relaunch was successful & new santoor became a important brand in the premium soaps segment. b) close up toothpaste is another e.g. of relaunch success.

BRAND RELAUNCH

Sometimes relaunch is done for products in the declining stage by repositioning. The best e.g. is Cadbury's chocolates. Changing from traditional sweet for children position ,Cadbury's is now positioned as a product meant for celebrations ( pappu pass ho Gaya-ad on TV) & also as a snack-food for teenagers and adults.

MANAGING BRANDS

companies must carefully manage their brands. First, the brands positioning must be constantly communicated to consumers. Expensive advertising campaigns can help to create name recognition, brand knowledge, & even some brand preference. Brands are not maintained by advertising but even by brand experience

PRODUCT DIFFERENTIATION

In a competitive market, for gaining competitive advantage ,companies have two alternative strategies attractive pricing based on cost leadership & economics of scale, or product differentiation through which they can offer superior value to the consumer Product differentiation allows the company to fight for the nonplank, with all the benefits associated with it. Differentiation helps a company to move to the position where it can claim a premium for its product in the market.

PRODUCT DIFFERENTIATION

Product differentiation strategies can be based on many parameters , of which the most common ones are below : a) form b) features c) performance quality d) conformance quality e) durability f) reliability g) reparability f) style h) design i) services

EXAMPLES OF BRAND POSITIONING A. maggi noodles B. milk-maid condensed milk