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Ch7: Products & Brands - Coggle Diagram
Ch7: Products & Brands
Types of Products
The Uniqueness of Services
4 Is of Services
Intangibility
i.e. services
Services tend to be more performance-oriented &, as experiences, generally can't be tried before purchase
Free trials given to overcome this drawback
To help consumers assess and compare services, it's important for marketers to demo benefits of using the services
Inconsistency
Delivery services is challenging cause quality of service is dependent on people who provide it & so it's inconsistent
Quality vary with each person's capabilities, experience, motivation, personality
Overcome this by providing training to get consistent quality experience
Online products often able to overcome this through standardized software, consistent website interfaces, reliable Internet services to limit service disruptions
Inseparability
Most cases, consumer can't & doesn't separate deliverer of service from service itself (example if you had a bad massage or something took too long from admin side, you generalize to whole company as being bad)
Inventory
Inventory of services is more complex than goods cause of nature of services
Inventory probs exist cause services can't be stored & accessed when in demand
In service industry, issues arise cause of fluctuating demand throughout day & difficulty in assessing requirements needed to service customers at peak times
Idle Production Capacity
Expensive & happens when service is available when there's little demand
Formally def as situation when supply of service exceeds its demand
Overcome by using part-time employees who are paid hourly wage & scheduled to work shifts
Products are available in both the online & offline environment
Use of internet - Most offline products dev strong web presence.1st point of contact for consumers with a brand is often online
Non-Durable Good
Item that doesn't last & consumed only once, or for limited number of times
Durable Good
Product that lasts for an extended period of time
Service
Intangible activity, benefit, satisfaction
CA has a strong service-based economy with services accounting for approximately 71% of GDP
In service industry, useful to distinguish between company's primary service & its supplementary services
Supplementary Services
Often allow products to differentiate their offerings from competition while also adding value to consumers
Many products are a hybrid of goods & services to offer more competitive product to consumers. Many goods are augmented with intangible services
Virtual Services
Exist only online & have no form of physical person-to-person interaction or tangible component
Service Continuum
As companies look at what they bring to market, there's a range from tangible to intangible, or goods-dominant to service-dominant
Product Elements
The Total Product Concept
3 Layers of a Product
The more complex & expensive the product, the more intricate layers used to differentiate product from competition
Core Product Layer
Fundamental benefit that consumer derives from having product (e.g. bicycles provide transportation & leisure activity)
Actual Product Layer
Physical good or service that consumer purchases when buying a product. Includes product's branding, design, features (e.g. branded bicycle, metal unisex frame, 10 speeds)
Augmented Product Layer
Additional features & attribute that accompany product. Exist for more expensive purchases (e.g. Warranty, repair facilities, service videos)
Packaging & Labelling
The look of the product is used to communicate its brand positioning to consumers
Can be physical or if online then website is form of packaging & central to communicating brand elements to consumers
Key source of competitive advantage since it provides functional benefits & communicates info about product & reinforce brand image
Function
Packaging has functional benefits
Allows product to be conveniently used, allows better storage, protects products that are fragile, improves product quality, provides safety function, makes product easier to use, makes product more efficient to transport
Communication
Communicates detailed product info, offers, directions on usage, nutritional content, other packaging requirements needed to meet legal obligations
Brand Image
Reflects product's positioning, its brand equity, its image
In 2020 & beyond, expect brands to take more comprehensive approach to packaging design & use packaging as opp to tell brand story, communicate key messaging, build deeper connection with ideal customers
Online, packaging has to carry more weight due to lack of storefront experience
Marketers must consider balance between making customer connection & other challenges, including handling environ concerns, managing health & safety issues, monitoring packaging costs
Product Lines & Product Mixes
Product Line
Group of similar products that are closely related cause satisfy similar need & are directed at the same general target market
Example
Coca-cola has 6 product lines - Soft drinks, waters, juice drinks, sports drinks, dairy products, & iced teas. Soft-drink line for example includes Cocal-Cola (it's variations), Sprite, Fresca
Product Line Length
Number of product or brands in product line
Product Line Depth
Number of different versions of each product sold within its product lines
Product Mix
All product lines marketed by a company
You can slice & analyze a company's product mix in many ways depending on depth of analysis required BUT more helpful to drill down into product mix by looking at product lines & products within each line
Product Mix Width
Number of different product lines offered by company
Consumer & Business Products
Consumer Products
Purchased by ultimate consumer for personal use
Items differ in terms of amount of effort that a consumer puts into making purchase, & how often items are purchased
SEE FIGURE 7.4 Classification of Consumer Products
Convenience Products
Inexpensive items that consumer purchases frequently with minimal shopping effort
If product doesn't meet expectations, little risk cause product is inexpensive & easy to purchase
Shopping Products
Items which consumer comparison-shops, assessing attributes & prices of different products & brands
Require greater investment of shopping time, more expensive than convenience products, require greater assurance of purchase satisfaction
Specialty Products
Require considerable time & effort to purchase
Tend to be more expensive branded products in category that are needed for special occasions
Include specialty brands & require high purchase satisfaction
Unsought Products
Items consumer either doesn't know about or isn't interested in purchasing
Business Products
[Industrial goods or organizational products]
Purchased either to run business or be used as component in another product or service
Major characteristic is that their sales often result of derived demand (sales of business products frequently result or derived from sale of consumer products)
Production Goods & Services
Items used in the manufacturing process that become part of the final product are production goods & services
Support Goods & Services
Items used to assist in producing other goods & services (e.g. installations, accessory equipment, supplies, services)
Branding
Brand Strategies
Brands classifed as either individual or family brands depending on whether name extended to cover more than one product category
Individual brand
When company uses brand name solely for specific product category
Family brand
When company uses brand name to cover number of different product categories
Brand extension
Extend use of brand name & use it to market other products
Sub-brands
Uses both family brand name and own brand name. Common strategy in automobile industry
Pros
For new goods/services brand equity is quickly transferred from flagship brand to new product saving org marketing funds to build up brand equity from scratch
Cons
If new product doesn't live up to image of flagship brand, or doesn't share values, then brand equity built up over time can be eroded for all products under family brand name
Protecting Brands - Patents, Trademarks, Copyright
Patent
Used to legally protect new technologies, or improvements on products or processes
Provide time-limited, legally protected, exclusive right to make, use, and sell an invention
Serve as reward for ingenuity
In CA patents currently protect owners for 20 years after patent filed, providing that maintenance fees paid during this time, after that it's free available to market
Copyrights
Used to legally protect original written works, sound recordings, or forms of communication from being copied by others
Music, literature, performances
In CA, it's protected for lifetime plus 50 years
Trademarks
Used by ppl or org to protect brand images, names, slogans, designs from usage by others
Limited to period of 10 years from date of registration, but can be renewed by owners to maintain investment
Legally protects brand name & its related logo, colours, fonts, various combinations that exist for use in particular category & in a part of world
If used in foreign countries, owner is should register an international application
Orgs hold separate trademarks for each version of brand name & associated graphics & logo
If trademark available & not challenged, brand & its associated design & logos can be legally registered in company name
Care must be taken to renew trademarks as required to ensure they don't expire
Brand Loyalty
Degree of attachment consumers have to particular brand tells marketer about their brand loyalty
Brand Loyalty
Favourable attitudes that consumer has over time toward brand that results in varying lvls of purchase insistence & commitment to brand
Varies by product & from person to person
Marketers strive to have highly committed, brand-loyalty consumers as this helps insulate brand from competitive marketing practices
What keeps consumers loyal to brand
1) Product quality
2) Value for money
3) Product consistency (size, taste, quality, etc)
4) Customer service
5) Easy shopping experience (shopping, check out, returns)
6) Selection/product assortment
7) Pricing
Most ppl have diff degrees of brand loyalty depending on product, brand, category
Consumers with stronger brand attachment have some brand loyalty but may easily brand-switch if brand isn't available
Brand's most loyal consumers will insist on purchasing brand of choice & will postpone purchase if brand not available
If consumer is switching brands based on price they have very little loyalty to begin with
Brand Personality
Set of human characteristics associated with brand
R shows that consumers often associate particular human personality traits with certain brands & prefer those whose personalities most appealing
Most successful brands in CA described as creative & in control
Brands described as different not as successful in CA
Brand Names
Key points when determining good brand name
Suggest product benefits
Be memorable, distinctive, positive
Fit company or product image
Have ability to be legally protected
Be simple
Care should be taken to review how brand name translates in other languages to avoid future pitfalls
Types of Brands
Manufacturer's brand
One that is owned & produced by manufacturer
Private-label brand
[Store brand]
Owned by retailer that contracts its manufacturing out to major suppliers & then sells product at its own retail stores, under its own store-brand name
Often products manufactured in same factories as manufacturer's brand with 20% of shopping dollars spent on private-label products (private-label products very popular in CA; this % is higher than global average)
CA customers believe private-label products good alternative to manufacturer's brands, offering good quality & good value
Provides retailers with opportunity to offer customers less expensive alternative to manufacturer's brand
Products generally sold at 25%-30% lower than manufacturer's brand. Cause store brands don't have to pay high listing fees & they lower marketing costs, retailers often make more profit on private-label brands = Incentive to invest in dev of more private-label products
Generic brand
No branding at all & sometimes produced as cheap alternative to manufacturer's brand and to private-label branded product
Typically named using the main product ingredient, with its main point of difference being price
Most common in pharmaceutical industry (once patent exprie, many generic versions created, saving gov, insurance companies, consumers lots of money)
Although less expensive alternative to other branded products, generic product lacks the brand equity & product recognition that manufacturer's brand & branded private-label products have
Brand
A name, phrase, symbol, or design uniquely given by a company to ID its products & distinguish products from competition
Brand names & logos often created in tandem, designed to visually rep brand to consumers & to build brand recognition
Brand Equity
Formally described as value of brand that results from favourable exposure, interactions, associations, experiences that consumers have with brand over time
Deving & nurturing brand is important factor in marketing of product
Needs to be supported with marketing activity, starting with creating its logo & designing packaging, website, deving new products & promotions to engage users & bring revenues & profits into company
Brand Elements
Trustworthiness - Most import element. Consistently dependable image that consumers have for brand & fosters ongoing confidence in recommending it to others
Engagement - Engaging consumers encourages brand loyalty by creating interactions, so consumers can learn more about brand & share it with others
Leading Edge - Brands that stand out often unique, innovative, forward-thinking. Approach is edgy & somewhat different, stands as benchmark for other brands
Corporate Citizenship - Brands that are caring have ability to connect with consumers by instilling pride
Presence - Brands need to have high profile with consumers & stand out from crowd. Brands make a statement about self & ppl use them. Often brands have many advocates that support them
Ipsos's top 10 most influential brands in Canada 2019
Google
Amazon
Facebook
Microsoft
Apple
YouTube
Netflix
Samsung
Walmart
Visa
Brands influence generations differently
Boomers - More traditional view of brands & like brands they grew up with
Gen X - Gravitate toward online & offline brands with mix preferences, inc. FB & Amazon
Millennials - Embrace digital age with Google, Netflix, Amazon, YouTube, FB, Apple
Gen Z - Comes of age & finds tech brands like IG & Snapchat most influential
Global Brands
Enjoy strong brand equity cause of hefty marketing budgets & well-recognized trademarks
Interbrand Global Brand Study
Criteria - 30% of revenue needs to be from outside home country. Must be present in Asian, Europe, North America, & emerging markets. Must have publicly available financial records. Must have future profit growth expectations. Must have public profile & awareness lvls outside own marketplace.
Ratings look specifically at brand's competitive strength, role it plays in purchase decision, financial performance
Apple, Google, Amazon, Microsoft, Coca-Cola