Marketing
Chapter 9
Managing
Existing Products
Gilbert A. Churchill, Jr.
Irwin/McGraw-Hill
J. Paul Peter
© The McGraw-Hill Companies, Inc., 1998
Slide
9-1
Table
9.1
Basic Categories of Consumer Products
Category
Type of
Purchase
Decision
Price
Promotion
Placement or
Distribution
Convenience
Little
information
sought
Relatively
low
Mass media
Widely
available
Shopping
More
information
sought
Moderate
Mass media;
some
emphasis on
personal
selling
Selectively
available
Specialty
Lots of
information
sought
Relatively
expensive
Mass media;
more
emphasis on
personal
selling
Exclusively
available
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-2
Table
9.2
Basic Categories of Industrial Products
Category
Type of
Purchase
Decision
Price
Promotion
Installation
Multiple
members of
buying center
Not as
important
Personal
Selling
Accessory
equipment
Few
members of
buying center
Several
members of
buying center
Frequent;
complexity
varies
Simple; frequent;
may be a single
buyer
Varies
May be
important
Advertising
May be
important
Personal
selling
Very important
Personal
selling
Important
Advertising
Varies
Varies
Component Parts
and materials
Raw materials
Supplies
Business
services
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-3
Goods and Services
Sealy Mattress
Maytag Washer
Kleenex
Tissues
Scott Towels
Pair of
Glasses
Durable
Goods
Non-Durable
Goods
Auto
Repair
Restaurant
Meal
Services
Fantastic Sam’s
Haircut
Airline Taxi Ride
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-4
Figure
9.1
The Product Life Cycle
Dollars
Total Market Sales
Total Market Profits
Introduction
Growth
Maturity
Decline
Time
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-5
Figure
9.2
Adopter Categories
Innovators Early
(2.5%)
Adopters
(13.5%)
Irwin/McGraw-Hill
Early
Majority
(34%)
Late
Majority
(34%)
Laggards
(16%)
© The McGraw-Hill Companies, Inc., 1998
Slide
9-6
Branding Terminology
•
•
Brand - a name, term, design, symbol, or another feature that identifies
one seller’s good or service as distinct from other sellers. (e.g.
Coca Cola)
Brand Name - that part of a brand that can be spoken. (e.g. the word Coke)
•
Brand Mark - that part of a brand that cannot be spoken. (e.g. the flowing
script used to write Coca Cola)
•
Trademark - a brand that has legal status by virtue of it’s being registered
with the federal government. (e.g. Coca Cola)
•
Trade name - the legal name under which a company operates. (e.g. The Coca
Cola Company)
•
Brand extension - the practice of using an existing brand name for a new
product. (e.g. Cherry Coke, Diet Coke, Caffeine Free Coke)
•
Service mark - a brand for a service that has legal status by virtue of its being
registered with the federal government.
•
Family brand - the use of the same brand name for an entire product line.
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-7
Types of Brands
Old El Paso
Manufacturer’s
Salsa
Brands
Private
Brands
A&P
Masterchoice
Salsa
Brand
Structure
Generic
Brands
Salsa
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-8
Selecting a Brand
A good brand name has several characteristics.
1. It should imply product benefits.
2. It should be positive, distinctive, easy to say and
easy to remember.
3. It should be consistent with the image of the
product and manufacturer.
4. It should be legally protectable and permissible.
5. It should translate well, if the product is to be
offered globally.
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-9
Figure
9.5
Elements of Brand Equity
Name
Awareness
Brand
Loyalty
Brand
Associations
Other
Brand Equity
Proprietary Brand
Assets
Name Symbol
Provides value to customer
by Enhancing Customer’s:
Interpretation/Processing
of information
Confidence in the
Purchase Decision
Use Satisfaction
Perceived
Quality
Provides value to firm by
Enhancing:
Efficiency and
effectiveness of
Marketing Programs
Brand Loyalty
Prices/Margins
Brand Extensions
Trade Leverage
Competitive Advantage
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
9-10
Figure
9.7
Product Mixes and Product Lines
Width
D
E
P
T
H
Ready-to-Eat Convenience Snack Foods
Cereals
Foods
Baking
Products
Dairy
Products
Total
Bisquick
Yoplait
Yogurt
Wheaties
Lucky
Charms
Cinnamon
Toast Crunch
Cheerios
Kix
Hamburger
Helper
Pop Secret
Popcorn
Suddenly
Salad
Fruit Rollups
Betty Crocker
Cake Mixes
Nature Valley
Granola Bars
Gold Medal
Flour
Colombo
Yogurt
Creamy Deluxe
Frosting
Dessert Mixes
Trix
Source: Courtesy of P. Gayle Fuguitt, Marketing Research Director, Big “G” Division, General Mills