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79 Cards in this Set
- Front
- Back
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Product
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Good, service, idea, or place consisting of a bundle of tangible and intangible attributes that satisfies consumers and is received in exchange for money or some other unit of value
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Core product
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Actual benefits received by consumer
Ex: Basic benefits - car gets you from point A to B, watch tells time, etc. |
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Actual product
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Quality level, features, design, packaging, and brand name of the product; The thing that delivers the core benefit
Ex: BMW is a high quality luxury car, Rolex is high quality watch, Starbucks is high quality coffee |
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Augmented product
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Associated service, warranty, delivery, credit, after-sale service associated with the product (Non physical aspect)
Ex: Warranties/services, coupons, etc. |
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Desired product
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The product consumers really want or think they want
Ex: Desserts with great taste and no calories, cars that use alternative fuel but power like gas powered cars, etc. |
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Where marketers differentiate product from competitors
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Augmented plus actual product
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Industrial products
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B2B; products sold from one business to another to serve organizational needs (includes installation, accessories, materials, etc.)
Ex: Ford buying plastic from Exmay Plastic Company |
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Consumer products
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B2C; Consumer buys from a company
Product satisfies individual needs Typically repetitive purchases Low expenditures |
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Product line
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Group of products closely related
Ex: P&G laundry detergents; Kellogg's read to eat cereal, etc. |
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Product mix
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Number of product lines offered by a company
Ex: P&G has household cleaners, dental products, laundry detergents, etc. |
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Depth of product line
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More depth means the firm carries a large assortment of each item; Number of items within each product line
Ex: Kelloggs has 56 types of cereal |
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Breadth of product line
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Refers to the variety of different items a firm carries; Number of different product lines
Ex Kelloggs has cereal, crackers, cookies, etc. |
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Critical questions for all products (new and old)
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1-What is the competitive advantage - why would customers buy this over another?
2-Is the product's CA something the target segment is seeking? 3-Is the CA sustainable? 4-Will customer pay a price that matches the value of the product with the CA? |
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Brand
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Name, symbol, or design used to identify the products and differentiate them from competitive offerings
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Characteristics of brands
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Intangible
Unique Timeless A relationship |
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Characteristics of products
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Tangible
Easily copied Become irrelevant A transaction |
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National Brand
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Ex: Dr Pepper or Mountain Dew
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Store brand
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Cheaper, low quality
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Copycat brand
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For example, purchased at CVS
Ex: Dr. Thunder (imitation of Dr. Pepper) |
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Brand name
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Words or letters of the brands
Ex: Apple, Nike |
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Brand mark
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Pictorial part of the brand
Ex: Nike swoosh |
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Purpose of brands
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Differentiate
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Trademark
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Brand that has been given legally protected status exclusive to the owner
Ex: We can't use the Nike swoosh and put a different name above the swoosh |
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Brand vs Product - importance
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Brand is more important than product
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Weak brands
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Low price, low sales volume
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Strong brands
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Higher price, sell larger volume
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Brand equity
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The added value of the firm, the channel, or the consumer with which a brand endows a product
-High equity = high preference, insistence, and recognition |
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Brand recognition
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Some knowledge of the brand; One aspect of brand loyalty
-Increase by promotion, distribution, and increase brand exposure |
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Brand preference
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Stage where consumer will prefer one brand over another but won't demand that brand each time (can switch)
-Increase by advertising with favorite celebs, offer benefits |
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Brand insistence
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Stage where no alternatives will suffice
-Increase by providing exceptional benefits |
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Behavior loyalty
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Purchase but no emotional connection
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Fake loyalty
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You have no other choice
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Emotional loyalty
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Have emotional connected to the brand
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Brand extensions
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New products in *different* product categories that often carry the same brand name
Ex: Dole OJ, Dole Pineapples, Dole Salad Ex: Apple iPod, Apple iPhone, Apple computer |
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Product line extension
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New products that closely resemble the firm's existing products within *one* product category
Ex: Coke, Diet Coke, Vanilla Coke |
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Cannibalization
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Drawback of product line extension; when one product may eat up your own product share
Ex: Diet Coke vs Coke - people start drinking Diet Coke instead, it eats up its own market share |
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Co-branding
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Marketing 2 or more brands together on the same package, promotion, or store
Ex: Disney Crocs |
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Product life cycle
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Describes the stages a new product goes through in the marketplace
Introduction, growth, maturity, and decline |
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Four premises of product life cycle
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1-Limited life
2-Distinct stages 3-Profits vary 4-Require different life cycle stages |
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Newness
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The level of consumer learning required for a product
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Continuous innovation
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No new learning
Ex: New flavors, packaging, colors -Builds customer awareness |
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Dynamically/Dramatically Continuous Innovation
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Disrupts normal routine but doesn't require totally new learning
Ex: Electric toothbrush, CD player, automatic flash for cameras -Promote points of different between old and new |
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Discontinuous innovation
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Requires new learning and consumption patterns by consumers
Ex: Cars, planes, phones, wireless communications -Educate consumers through trial and personal selling |
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Greatest return on investment potential?
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Discontinuous innovation
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Least return on investment potential?
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Continuous innovation
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Greatest risk for innovations?
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Discontinuous innovation
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Most common innovation?
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Continuous risk - low risk , little change, easy to innovate
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Idea Generation
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Stage one of New Product Development Process
-Many good ideas come from consumers Ex: Coke Freestyle - What did consumers mix the most |
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Screening
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Stage two of New Product Development
-Separate ideas that have merit from those that don't |
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Concept development and testing
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Stage three of New Product Development
-Measure consumer attitudes in relation to the product/attitude analysis Ex: Surveys that ask "would this type of product be of interest to you?" |
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Rough marketing strategy
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Stage four of New Product Development
-Develop a strategy that describes target market, price, promotion, planned sales, etc. |
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Development
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Stage five of New Product Development
-Physical product now exists and results can be analyzed by the company |
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Test marketing
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Stage six of New Product Development
-Selecting a specific geographic area to be generalizable to the product's overall target market Con: expensive, risky |
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Commercialization
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Stage seven (final stage) of New Product Development
-Most expensive stage in the process; Decide channels to use, promotion, pricing, etc. |
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Promotion
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The process of communicating product and services information to target customers and other stakeholders of the firm
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Aspects of promotion mix
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Advertising
Sales promotion Personal selling Direct marketing |
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Hierarchy of Effects Model
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Awareness
Familiarity Consideration Purchase Satisfaction Loyal/Repeat purchase |
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Advertising
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Paid, non-personal communication initiated by a marketer to create or maintain a relationship
Ex: TV, banner ads, pop ups, radio, print, etc. |
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Informative advertising
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Used for *new* products
-build awareness -induce trial |
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Persuasive advertising
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Used for *established* brands
-Remind people -Increase frequency of buying |
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Product/service advertising
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Objective is to increase purchases
-Specific brand/product Ex: Ad for ketchup, ad for car, ad for UPS |
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Institutional advertising
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Objective is to highlight the organization
-Promote organization image, build industrial good will Ex: Breast cancer ad, Got Milk ads |
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Reminder advertising
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Reinforce purchasing behavior
Ex: Candy ads at Halloween time |
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Advocacy advertising
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Communicates a marketer's position on an issue
Ex: Don't drink and drive |
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Comparative advertising
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Creating a differential advantage by comparing a product with a competitor
Ex: Coke VS Pepsi |
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What makes an effective ad campaign?
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-Attract attention
-Message clearly -Modify attitudes/beliefs -Change behavior |
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Research - improves remembering in an ad
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Print size increases
Color ads Shorter headlines |
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Research - does NOT effect ads
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Length of commercial
Believe them |
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Research on market share
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-Response to advertising is greater for low market share brands because of market saturation
-For established products, advertising doesn't increase sales |
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Aided recall
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Ask people about the ad and prompt them about different parts of the ad and where they saw it
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Attitude test
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Measure whether people's attitudes have changed after seeing the ad
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Sales test
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See how advertising effects actual sales
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Social media and buzz marketing
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Facebook ads or make a video that everyone talks about
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Purpose of sales promotion
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Encourage purchase
Specified time period Short term objectives |
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Objectives of sales promotion
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Build awareness
Provide info Economic incentive Create invitation to buy now |
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Examples of sales promotion
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Contests/sweepstakes
Money off/Rebates Loyalty programs Samples Product placement Coupons |
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Types of contests/sweepstakes
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Instant win
Offers an experience as a prize |
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Point of purchase
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Located in high traffic areas near the cash register or end of aisle
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Research on sales promotion
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Price reductions increase sales
High market share brands less promotion elastic Heavily promoted products lose brand equity In store displays build sales |
