Unit 10 – Product Planning
Chapter 34 – What is Product Planning
Objectives 34.1
Product planning involves making decisions about the production and sale of a business’s products. Decisions you will need to make include packaging, labeling, warranties, guarantees, branding, and product mix. A well-defined product plan allows a business to create sales opportunities, design appropriate marketing programs, and develop effective advertising campaigns.
Terms 34.1
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Product Planning – Making decisions about the production and sale of a business’s products.
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Product Mix – All the different products that a company makes or sells.
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Product Line – A group of closely related products manufactured and/or sold by a business.
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Product Item – A specific model, brand, or size of a product within a product line.
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Product Width – The number of different product lines a business manufactures or sells. Product Depth – The number of product items offered within each product line.Product Modification – An alteration in a company’s existing product.
Objective 34.2
The product life cycle represents the stages that a product goes through in its life. Careful management of the product must take place throughout each stage which includes the
Introduction Stage, Growth Stage, Maturity Stage, and Decline Stage.
Terms 34.2
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Product Life Cycle – The stages that a product goes through in its life.
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Product Positioning – The efforts a business makes to identify, place, and sell its products in the marketplace.
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Category Management – A process that involves managing product categories as individual business units.
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Planogram –Computer developed diagrams that show retailers how and where products within a category should be displayed on a shelf at individual stores.

Chapter 35 – Branding, Packaging, and Labeling
Objectives 35.1
An important part of product planning is the use of brands. Nearly every product has a brand, some are well known worldwide. Brands help to sell the product and establish customer loyalty. There are three types of brands, which are National Brands, Private
Brands, and Generic Brands. Branding strategies are used to meet sales and company objectives.
Terms 34.1
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Brand – A name, design, or symbol that identifies the products of a company or group of companies.
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Brand Name – The word, group of words, letters, or numbers of a brand that can be spoken.
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Brand Mark – The part of the brand that is a symbol, design, or distinctive coloring or lettering.
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Trade Name – Identifies the company or a division of a particular corporation.
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Trade Character – A personified brand mark.
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Trademark – A brand name, brand mark, trade character, or a combination of these that is given legal protection.
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National Brand – Also called manufacturers brands, are owned and initiated by manufacturers.
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Private Brand – Owned and initiated by wholesalers and retailers.
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Generic Products – “No frills” products that don’t carry a brand name.
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Brand Extension – A branding strategy that uses an existing brand name for an improved or new product in the product line.
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Brand Licensing – The legal authorization by a trademarked brand owner to allow another company to use its brand, brand mark, or trade character for a fee.
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Co-Branding Strategy – Combines one or more brands to increase customer loyalty and sales for each individual brand.
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Mixed-Brand Strategy –Involves simultaneously offering a combination of national, private, and generic brands.
Objectives 35.2
A package does much more than hold a product. The packaging helps promote and sell the product, helps identify the product, provides information, meets different customers needs through sizing, and can improve product safety.
Terms 35.2
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Package – The physical container or wrapping for a product.
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Label – An information tag, wrapper, seal, or imprinted message.

Chapter 36 – Extended Product Features
Objective 36.1
Consumers have a right to expect quality products at fair prices. There are different types of warranties designed to promise the customer that a product will meet certain standards.
Many of the origins of the warranties (explained below) come from the Magnuson-Moss
Consumer Product Warranty Act of 1975.This statute governs written warranties for all consumer products costing $15 or more.
Terms 36.1
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Warranty – A promise, or guarantee, given to a customer that a product will meet certain standards.
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Express Warranty – Explicitly stated in either writing or spoken words to induce customers to buy.
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Full Warranty – A written warranty that will guarantee the replacement or repair of a product if it is found to be defective within the warranty period.
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Limited Warranty – Offers less coverage than a full warranty and may exclude certain parts of the product from coverage.
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Implied Warranty – Exists automatically by state law whenever a purchase takes place.
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Warranty of Merchantability – A promise from the seller that the product sold is fit for its intended purpose.
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Warranty of Fitness for a Particular Purpose – Arises when the seller advises a customer that a product is suitable for a particular use and the customer acts on that advice.
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Disclaimer – A statement that contains exceptions to and exclusions from a warranty.
Objective 36.2
Managing and maintaining your credit is very important. You need to be in good standing anytime you want to purchase a home, or purchase products based on a line of credit. Businesses use credit to purchase goods and services, which are ultimately sold to consumers. There are four types of credit accounts that are extended to consumers, which are Regular, Installment, Revolving, and Budget Accounts.
There are five sources of consumer credit, which are bank credit cards, retail credit cards, credit card companies, debit cards, and secured and unsecured loans.
Terms 36.2
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Credit – An arrangement whereby businesses or individuals can obtain products or money in exchange for a promise to pay later.
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Regular or 30-day Accounts –Allow customers to charge purchases during a month and pay in full within 30 days after they are billed.
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Installment Accounts – Allow for payment over a period of time.
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Revolving Accounts – The credit limit and payment due date is determined by the retailer. The minimum payment is usually a percentage on the balance due.
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Budget, or 90-day Accounts – Allow for the payment of a purchased item over a
90-day period without a finance charge.