lec_7a_(2).

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Products, Services &
Brands
Chapter: 8
Lec: 7b
Product Line Decisions
• Product Line
A group of products that are closely related
because they function in a similar manner,
are sold to the same customer groups ,
are marked through the same types of
outlets, or fall within given price ranges
• A company can expand its product line in
two ways
- Line filling (add more items in line)
- Line stretching (upwards/ downwards)
e.g. Hotel one, PC, Marriot (downwards)
Tata Indigo, upper market car
(upwards)
Product Mix Decisions
• Product Mix
The set of all product lines and
items that a particular seller offers
for sale
- Product mix has four dimensions
1- Width
2- Length
3- Depth
4- Consistency
Product Mix Decisions
• Width
The number of different product lines the company
caries
e.g. Sony ( TV, play station, camera)
• Length
Total number of items a company carries in its
product line
e.g. digital cameras, camcorders
• Depth
The number of versions offered of each product in
the line
e.g. Flat panel, rear projection, High/low resolution
• Consistency
How closely related the product line are
e.g. Distribution, stores availability
Branding Strategy: Building
Strong Brands
• Brand Equity
The differential effect that knowing the brand name
has on customer response to the product or its
marketing
- brand vary in the amount of power
e.g. Song, Nike, Disney, McDonalds
- Customer perception dimensions
1) Differentiation (what makes the brand stand out)
2) Relevance (how it meets consumer needs)
3) Knowledge (how much consumer know about the
brand)
4) Esteem (How do consumer respect the brand)
Building Strong Brands
Brand
Positioning
Attributes
Benefits
Beliefs and values
Brand name
selection
Selection
Protection
Brand
Sponsorship
Brand
Development
Manufacturer’s
brand Private
Brand Licensing
Co-branding
Line extensions
Brand
extensions
Multibrands
New brands
Building Strong Brands
• Brand Positioning
e.g. Volvo
attributes: features of
the car
benefit: what you’ll
get out of them
(safety)
Belief and values:
e.g. Marriot- Luxury
rooms
Building Strong Brands
• Brand Name
Selection
- can add to a
product’s success
- best suited for
product category
- should be protected
Building Strong Brands
• Brand Sponsorship
There are four
sponsorship options
- National Brand: sell
under your own name
(Sony Bravia)
- Private Brand:
(distributor brand)
- Licensed brands
- Co-brand
Brand Sponsorship
• National Brands Vs Store Brands
Store Brands
A brand created and owned by a
reseller of a product or service
e.g. HKB, Al-Fateh
- Retailer can select the best place
in store for their brands
- Select a lower price as compared
to national brands
Brand Sponsorship
Licensing
• Takes years and millions to
create a brand
• Some companies license names/
symbols for a fee
• Toys based on Tv characters
• Characters on clothes, bags etc.
Brand Sponsorship
• Co-branding
The practice of using the established
brand names of two different companies
on the same product
- you can bring new value for your
customers
e.g. Marriot and Barclays
Nike and ipod
- Complex legal contracts and licenses
“Giving away your product is like giving
away your child – you want to make sure
everything is perfect”
Brand Development
• A company has four choices when it comes to
developing brands
Line extension
Extending an existing brand name to new forms,
colors, sizes, ingredients, or flavors of an
existing product category
e.g. Bata, regular shoes, sports shoes, sandals
etc.
- Geo news, geo super, geo entertainment
-An overextended brand name might lose its
meaning
- Sale of an extension might come at the expense
of other item
Brand Development
• Brand Extensions
Extending an existing brand
name to new product
categories
e.g. Maggie Noodles, Maggie
soup, Maggie Ketchup
- Ponds tooth paste, Heinz pet
food met early death
- Extension may confuse the
image of the product
Brand Development
• Multibrands
Companies introduce additional
brands in the same category
- Each brand entertains a different
segment
- Each brand may obtain a small
marketplace
Brand Development
• New Brands
Brand Development Strategies
Product
Category
Existing
Existing
New
Line extension
Multibrands
New
Brand
Extension
New Brands
Brand Name
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