Monday, January 21, 2019 MKTG2200 Product - Starting point in creating a marketing mix - Not all product can be owned Product - Augmented Reality - Augmented Reality (AR) will continue to affect the way products are defined, identified and sold - To be effective it should be used in real life environments Convenience Goods Shopping Goods - Require comparison shopping - Homogeneous: products is perceived as similar, looking for lowest price brand the desired features. - Heterogeneous- product is perceived as different Specialty Goods - Consumers search extensively - Unwilling to accept substitutes - Unique characteristics Unsought Goods - Unknown to the consumer - Known product but not actively sought after - Insurance, burial plots: require person selling and aggressive advertising -New products until consumer becomes aware Product Items, Lines and Mixes Product Item • Distinct offering Product Lines • Group of closely related Product Mix • All the products that a company sells Product Mix Width • Number of products lines offered Product Line Length • Number of products items in a product line 1 Monday, January 21, 2019 Product Line Depth • # of types and sizes offered for each product line Adjustments 1. Product modification: changing one or more of a products characteristics - Quality Modification, Functional Modification, Style Modification Planned Obsolescence: the process of modifying products so that this products that have already been sold become obsolete before they need replacement Repositioning: Changing consumers perception of the brand (changing demographics, declining sales, competition intensification) Product line extensions: adding products to existing product line Product line contraction: reduce the # of items in a product line Benefits: - resources can be allocated to more important products - Less waste of management time and strategic energy - Greater opportunity for remaining products as financial and human resources are available Branding Brand: -Name -Term -Symbol -Design -Combination Consumer actions, thoughts, expectations, and feelings Brand name: the part of a brand that can be spoken (letters,words,numbers) Brand mark: the elements of a brand that cannot be changed Benefits of branding • Product identification • Repeat sales • New-product sales Generic vs. Branded Manufacturers vs. Branded Individual vs. Family brand Cobranding • Two or more brand names on a package or product - Ingredient branding - Cooperative branding 2 Monday, January 21, 2019 - Complementary branding • Useful strategy when a combination of brand names enhances prestige or perceived value of a product or when it benefits brand owners and users Trademarks -The exclusive right to use a brand or part of a brand Service mark: - Shapes - Ornamental colour or design Catchy phrase Abbreviations Sounds Trademark protection: • Aggressively enforce their trademarks • Severe penalties exist • “knockoffs” unauthorized brands • EU files or registers a trademark Packaging: • Containing • Protecting • Promoting • Facilitating Storage, use, convenience • Facilitating recycling Labelling: • Persuasive labelling - Focuses on a promotional theme or logo and consumer information is secondary • Informational Labelling - Designed to help consumer make proper product selection to reduce cognitive dissonance after purchase - Consumer Packaging and Labelling Act UPC (1974): matched to brand names, package sizes and prices, source of excellent data for retailers Global issues in Packaging • Proper labelling • Package aesthetics • Extreme climates Product Warranties: protects the buyer and provides essential information about the product -Express warranty • Written guarantee 3 Monday, January 21, 2019 -Implied warranty • Unwritten guarantee that the good is fit for the purpose for which it is sold Categories of New Products* 1. New to the world 2. New product lines 3. Additions to product lines 4. Improvements or revisions to existing products 5. Repositioned products 6. Lower-priced product The process: 1.New product strategy 2.Idea Generation 3.Idea Screening 4.Business Analysis 5.Development (4 p’s) 6.Test Marketing 7.Commercialization 4