Product and Services Strategy Chapter Eight Lecture Slides Express Version Course Professor Date

Looking Ahead After studying this chapter, you should be able to: Define product and the major classifications of products and services Describe the roles of product and service branding, packaging, labeling, and product services Explain the decisions companies make when developing product lines and mixes Identify the four characteristics that affect the marketing of a service Discuss the additional marketing considerations that services require ©Copyright 2004, Pearson Education Canada Inc.

Products, Services, & Experiences Product: anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need Service: are products that consist of activities, benefits, or satisfactions offered for sale that intangible, and do not result in the ownership of anything Experiences: those aspects of products which take place in the minds of consumers, and are memorable ©Copyright 2004, Pearson Education Canada Inc.

Levels of Product Core benefit or service Figure 8-1 Augmented product Installation Delivery and credit Packaging Actual product Core benefit or service Features Brand name Core product Quality level Design Warranty After-sale service ©Copyright 2004, Pearson Education Canada Inc. Figure 8-1

Types of Consumer Products Convenience: Frequent purchase, low involvement, widespread distribution, mass promotion Shopping: Less frequent purchase, more effort, comparison of brands, price, and quality, selective distribution and promotion Specialty: Strong brand preference, special purchase effort, low price sensitivity, exclusive distribution, targeted promotion Unsought: Low product awareness, negative interest, use personal selling ©Copyright 2004, Pearson Education Canada Inc. Table 8-1

Types of Business Products Materials and parts: Raw and manufactured materials, parts Capital items: Buildings and equipment used in buyer’s production or operations, long useful life Supplies and services: Operating supplies, repair and maintenance items, and services ©Copyright 2004, Pearson Education Canada Inc.

Individual Product Decisions Product attribute decisions Product quality, features, style and design Branding decisions Brand equity, name selection, manufacturer’s versus private brands, licensing, co-branding, line and brand extensions Packaging Hold and protect contents, identify and promote the product and brand Labelling Ingredients, directions for use, identify and promote Product support services Repair and maintenance, accessories ©Copyright 2004, Pearson Education Canada Inc.

Four Brand Strategies Product category Brand name Existing New Line extension Brand extension Existing Brand name Multibrands New brands New ©Copyright 2004, Pearson Education Canada Inc. Figure 8-4

Product Line Decisions Group of closely related products Length equals number of products Line stretching Adding products to the line outside of current range Line filling Adding more products within current range Product mix decisions Width Length Depth Consistency ©Copyright 2004, Pearson Education Canada Inc.

Characteristics of Services Intangibility Cannot be seen, tasted, felt or smelled before purchasing Inseparability Production and, consumption, and from the provider Variability Service quality depends on who provides and under what conditions Perishability Cannot be stored, for resale or later use ©Copyright 2004, Pearson Education Canada Inc. Figure 8-5

Marketing Strategies for Services The service-profit chain consists of: Internal service quality Superior employee selection and training Quality work environment Support for those dealing with customers Satisfied and productive service employees Greater service value Satisfied and loyal customers Repeat purchasing and word of mouth advertising Healthy service profits and growth Main marketing tasks: service differentiation, service quality, and productivity ©Copyright 2004, Pearson Education Canada Inc.

Looking Back Classifications of product and services Branding, packaging, labelling, and support services Product line and mix decisions Characteristics of services Additional marketing considerations for services ©Copyright 2004, Pearson Education Canada Inc.