1. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 1 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Firm objectives Specificity Distinctiveness Realism “Balance” within market Brand objectives Relation to firm objectives Balance Product line objectives Relative to firm and brand objectives

2. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 2 Firm Level Objectives Usually ultimately to maximize present value of total profit—but HOW? Specificity Distinctive competencies Leveraging of other resources Market balance Willingness/ability to assume risk

3. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 3 Specificity Distinctive competencies Product development Manufacturing Quality Cost effectiveness Timing Distribution Promotion Leveraging other resources Brand image People Running facilities Contacts Financing Equity/cash Ability to raise money

4. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 4 Market Balance Differentiation tends to reduce—but not eliminate—price competition E.g., clothing retailing Mass market: K-Mart, Wal-Mart Department upscale: Nordstrom Department: Sears, J.C. Penney Full service, general category Sole brand: Laura Ashley, T. Hilfiger Special target: Gap Specialty stores Liquidation/outlet

5. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 5 Market Balance Prepared food Upscale restaurants Affiliated Unaffiliated Specialty/ethnic Chinese, Mexican, Argentine Fast food Hamburger Ethnic Niche Health Beverages…

6. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 6 Risk For higher level of risk, a higher rate of return is generally necessary Some risks Liquidity Short term earnings Long term Damage to brand Loss of resources Other profitability impact

7. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 7 Brand Objectives Ultimate objective: Contribution to overall firm profitability Implementation objectives Margins: Absolute vs. percentage Long term vs. short term Volume/market share Prestige/brand premium

8. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 8 Distribution Issues in Brand Objectives Margins Absolute vs. percentage Product line issues Long term vs. short term—brand building vs. “harvesting” Volume/market share Cost of production/marketing Selectivity of distribution Brand premium Quality of brand Specialization/ niching Variety/selection Specialization to target market Adaptation Service Warranty Support Training

9. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 9 Product Line Objectives Objective: Maximize overall contribution of product line Margin components (e.g., printers vs. supplies) Promotion (e.g., Coca Cola clothing) Ease of availability Building vs. harvesting

10. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 10 DISTRIBUTION OBJECTIVES: THE BIG PICTURE Distribution to achieve firm objectives Tradeoffs between distribution options Cost Selectivity/ image Intensity Service impact Opportunities

11. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 11 Some Very Interrelated Objectives! Selectivity/Intensity Exclusivity Service/support capacity Dealer loyalty Visibility Convenience vs. Cost Brand image Cost vs. Speed Intensity Brand image effects Specialization Channel relations

12. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 12 Some Tradeoffs Reach vs. exclusivity Consumer behavior Willingness to search Purchase situation Planned Impulse Semi-planned, location specific Brand effects

13. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 13 Some Cosmetics Outlets Prestige Upscale department stores Company stores Specialty stores Personal selling Impulse Vending machines Convenience stores Other intensity College book stores Planned purchase Category discounters (e.g., Sally Hansen) Supermarkets Discount stores Avon ladies Specialty catalogs Department stores Impulse Supermarket checkout Hair/beauty salons

14. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 14 More Tradeoffs Reach vs. dealer service/support Advice Accessories Product specific Complementary Warranty service/repairs

15. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 15 Reach vs. Dealer “Loyalty” Upscale dealer is often more interested in pushing exclusive brand Effects of loyalty “Push” of brand Service/support However, brand may not develop identity of its own

16. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 16 Cost of Distribution vs. Speed Intensity Visibility Brand image effects Specialization Channel relations

17. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 17 Some Distribution Opportunities Product promotion Shelf-space Demonstrations Placement “Parallel” distribution Factory outlets Electronic/catalog Partnerships (joint distribution and promotion)

18. BSAD 113 FIRM, BRAND, AND PRODUCT LINE OBJECTIVES Lars Perner, Instructor 18 Deciding on a Distribution Strategy Consumers Focus groups, interviews, surveys Scanner data Frequency of purchase Correlated purchases Observation in the field Usage Purchase Decision method Competing products Complementing products Communication with distributors (retailers, intermediaries) Meetings/calls Trade shows