Product Management Strategies
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –1

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Product mix —the full set of products by type, brand, size, style, colour sold by a firm.
A product mix has dimensions both of breath and depth.
Breadth —the number of product lines.
Depth —variety of sizes, colours and models (Fig.
8.1, Rix 5e).
Product line —a group of products sold together or intended for the same general use.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –2

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• Expansion of the product mix.
Alterations of existing products.
Product mix contraction.
Trading up, trading down.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –3

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Line extension —an extension can be related or unrelated.
Aims to appeal to more market segments with the same basic product, and to increase usage rates.
Related —an increase in depth of the product.
Unrelated —an increase in the breadth or product range.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –4

• Types of alterations:
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Redesign.
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Modification.
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Packaging.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –5

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Eliminating an entire product line
– Deleting non-profitable product lines.
Simplifying the product assortment
– Specialising in a smaller range of products.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –6

• Marketers add:
– Higher priced item
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To increase perception of product prestige and attract the higher income market.
– Lower priced item
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To increase perception of product prestige and attract the lower income market.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –7

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Negligible net gain, buyer confusion.
Sales generated at expense of older products —cannibalisation.
Hurt or affect firm’s reputation.
Change firm’s image.
Confuse new and current target market owing to change in product positioning.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –8

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A brand name is a term, sign and/or special design that is intended to identify the goods or services of one seller and distinguish them from all others.
E.g.
Uncle Toby’s.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –9

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Easy identification of product.
Assures consumer of comparable quality.
Stops confusion and helps seller control their market.
Helps sellers to control their market.
Differentiation…a measure of distinction.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –10

• Cost of maintaining market presence, including:
– Promotions.
– Brand quality.
– Product cannot be differentiated.
– Physical nature of product, e.g. fruit and vegies.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –11

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Suggests characteristics, benefits, use or action.
Easy to recognise and pronounce.
Is distinctive.
Adaptable to new products that might be added to the product line.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –12

• Product counterfeiting —refers to placing a brand name on a product even though the rights to the product or name are not owned by that firm.
• Generic usage —when a brand name is so common it describes the category, e.g. Aspirin is a brand that also signifies ‘headache tablet’.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –13

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Marketing under producer ’s own brand—includes entire output, e.g. IBM.
Branding or fabricating parts and materials —used to develop market preference, e.g. Intel.
Marketing under intermediaries ’ brands— generates additional sales volume and profit, e.g.
Farmland or No-Frills.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –14

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Separate name (individual brand) —a brand name given to individual products, leaving out the manufacturer’s name.
Family branding (blanket) —brands that take on the manufacture r’s name, e.g. Mars Bar.
Combined-brand strategy —the combination of the manufacture r’s name with a product, e.g.
Kellogg’s Special K.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –15

• Multi-branding —firm using more than one brand name for similar products in its range in an attempt to reach different market segments. E.g. Dynamo &
Fab washing products.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –16

• Brand equity is the value a brand adds to a product. Brand equity benefits:
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Become a differential advantage.
Create barriers for companies entering the market.
Help products survive changes in the operating environment.
Strong potential for trademark or brand licensing.
Maintaining product quality.
Support positioning (through promotional message).
Maintain open two-way communication with customers.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –17

• Defined as all the activities of designing and producing the container or wrapping for a product.
• Packaging performs several marketing functions: protection of the product and the people handling and using it; providing information; helping promote the product.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –18

• Protecting the product and the purchaser
– Protect against damage.
• Gaining acceptance of the product by intermediaries
– Wholesalers and retailers.
• Helping persuade consumers to purchase the product
– Clear identification of product.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –19

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Family packaging
– Family resemblance.
Changing the packaging
– Redesign of package.
Re-use packaging
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Glass jars re-used as a glass.
Refill containers.
Re-usable envelopes.
Multiple packaging:
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The practice of placing several units in one container.
Used to increase consumer’s consumption of products
(e.g. toilet roll six pack).
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –20

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• Packaging is deceptive.
Packaging depletes our natural resources.
Packaging is excessively expensive.
Packaging poses environmental hazards.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –21

• A label is the part of a product that carries information about the product itself, or about the seller. It is used to communicate useful information to customers.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –22

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Design benefits:
– Improves marketability.
Significantly differentiates product.
Promotional appeal.
Can be protected under Designs Act.
E.g. furniture or prestige pen.
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –23

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Warranties give consumers assurance that they will be compensated if a product does not perform according to reasonable expectation .
Product liability — responsibility producers have to safeguard the interests of the consumers of their products.
Implied warranty — the idea that warranty was intended by the seller even though it was not stated.
Copyright
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –24

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A common consumer complaint is that manufacturers and retailers do not provide adequate repair services for the product they sell.
Providing effective post-sales service such as advice, training, maintenance and repairs has become more essential as products become more complex.
Copyright
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2004 McGraw-Hill Australia Pty Ltd
PPTs t/a Marketing: A Practical Approach 5/e by Peter Rix
Slides Prepared by: Joe Rosagrata
8 –25