What is a Product?

The Wrong Question!

What do people buy?

People Buy an offering.

Core product...: benefits sought; at the most fundemental level, the benefits sought are the emotional states that result from a successful product purchase --; people rarely think about their purchases in this manner, yet their future behavior depends on whether they have successfully found the benefits that they sought, -- that they expected to receive.
Note how this relates to segmentation and to positioning.
Tangible product...let's get physical: features; brand name; packaging; "quality"
Augmented product... nearly synonomous with the whole offering, including all attributes.: delivery?; installation?; flirt with sales person?; warranty; credit or terms; after sales service?; unpaid celebrity usage of product?; e.g. unpaid for celebrity visits to a partucular resort?; How does this relate to the offering?

Some major brand companies.
Media Brands

What good are brands? For the Company Brand Equity Brand loyalty? Brand Awareness Brand Association Transfer of Equity, Loyalty, and Awarness to other products of same company For the Customer Consistency Signal of Quality and Value Suggestive of attributes Identification with brand e.g. Diesel of Sevens: As the number of product choices increases, the value of brands to customers increases which in turn increases the value of brands to companies.
Brand Name should be:: suggestive of product attributes, use, quality, benefits; easy to pronounce & remember; distinctive; easy to translate into other language; legally protectable by registration

Lovemarks? Do you have any?

Packaging the 5th P: primary, secondary, tertiary; For some products the package is a very important aspect of the product itself.; Packaging is especially important because of self service; affluence??? will we pay more? probably; package reinforces or even creates the company or brand image.
Packages must stand the tests of: functionality; visual appeal; stocking ease for dealers; consumer response

Packaging as waste...: 40 percent of solid waste is packaging!; Does it matter?
What is the solution?

Three other P's of marketing you might run across: People -- who does a customer interact with?; Process -- How does the interaction happen?; Payment -- aside from the monetary price, how will payment be made?

When the service is the product (link)

Service as part of the augmented product

What services... the mix

How good a service level should you have? (check it occasionally)

What form will it take?: in-house repair vs. contracted; centers vs. no repair
Service Departments Handle:: complaints; credit; maintenance; technical help; information on other products

Brand Strategy and Product Line and Mix decisions

A product line. Products in the same category with differing attributes and/or prices.

Note that some people will talk about lines and mixes slightly differently. That means that as always, you need to clarify what is meant when there is any doubt.

Some of the ideas about product lines directly correspond to department stores.

Product and Brand Strategies

	Existing Product Category	New Product Category
Existing Brand Name	Line Extension	Brand Extension
New Brand Name	Multi-Brands	New Brands

Typical patterns of grow and prune.: Product line stretching; Product line filling; Note the similarity between product line stretching and diversification... the difference is one of scale.; Products in the line should have just noticeable differences.; Featured products... loss leader or flagship

Product mix

A set of product lines measured by:

length of the lines(# of different products in a line)
width of the mix (# of lines)
depth of each line (# of variants)
consistency (how are products related eg. distribution, use, promotion)

A company can grow by expanding any element of the product mix although the new sales may not be profitable.

The Product Life Cycle Stages and Implications

Few products go on and on.... so companies must plan ahead with innovations to stay in business.

The PLC gives us a way to think about what needs to be done at any given time.

There are distinctly different implications for marketing mix tactics as a product matures.

Different activities at different stages of the Product Life Cycle

New Products

The development of the Xerox machine. AVI video 63MB! ~7min

Even fatter version at 141MB

Concept testing

appropriate consumers

focus groups

questionnaires

interviews

Problems: unreal; please interviewer
Suggestion: use projective techniques; Why would anyone want?; What kind of person?; What would it have to be like for people to buy it?

Market Testing

Standard test markets

Controlled test markets

Simulated test markets

Sales wave research

Product Launch Considerations

When?

Where?

To Whom?

How?

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