Product

- Dfinition - Product Levels - Classification - Product Mix

DEFINITION :
Product: An offering that can satisfy a need or want. Goods; Services; Experiences; Events; Persons; Places; Properties; Organizations; Information; Ideas.

Benefits Associated With the Product

Core Benefits Tangible Benefits
Augmented Benefits

Five Product Levels

Level Core Product Generic Product Expected Product Air- Conditioner Cooling & Comfort Sufficient cooling capacity & acceptable energy efficiency rating, reasonable air intakes, exhausts & so on. At least two cooling speeds, expandable plastic slide panels, adjustable louvers, removable air filter, vent for exhausting air, power cord, at least 60inches long, relatively safe refrigerant, one- year parts warranty & on-site service warranty, & five- years warranty on the refrigeration system. Optional features might include electric touch-pad controls, a display to show indoor & outdoor temps. & the thermostat setting, an automatic mode to adjust fan speed based on the thermostat setting & room temp., & a toll free no. for customer service, one or two free services, etc Silent operation, temp. completely balanced across the room, & energy self sufficient.

Augmented Product

Potential Product

Classification of Products
Product

Durability & Tangibility

Consumer Goods

Industrial Goods

Classification Based on Durability & Tangibility

Durability & Tangibility

NonDurable

Durable Goods

Services

Classification Based on Consumer Goods

Consumer Goods

Convenience Goods

Shopping Goods

Speciality Goods

Unsought Goods

Classification Based on Industrial Goods

Industrial Goods

Material & Parts

Capital Items

Supplies & Business Services

Product Mix Decisions

A product mix is the set of all products & items a

particular seller offers for sale & is also called as product assortment. The proliferation of products within the company means that product policy decisions are made at three different levels of product aggregation i.e;
A. B. C.

Product Item Product Line Product Mix

Product Mix Decisions

Product Item: It is a specific version of a product that

has a separate designation in the sellers list.

Product Line: A set of individual products that are

closely related.
Product Mix: Products offered for sale by a firm or a

business unit.

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Product Mix
Product Mix Width
Bath Soaps Fabric Wash Wheel Rin Surf Toothpaste Prodent Close Up
Pepsodent

Product Line Length

Liril Lifebuoy Pears

Product Mix

Organizational Goals & Product Mix

goods & services to consumer for satisfaction of their needs can be possible if due attention is given to three issues which govern the product mix, namely

The efficient fulfillment of the marketers goal to supply

Sales Growth Sales Stability Profits

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Constituents of a Product Mix

Product Width: It explains how many different product

lines a company carries.

Product Depth: It explains the number of products that

a product line has in its overall product mix.

Product Length: It is the sum total of number of items

in each product lines.

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Product Line Decisions

Product line decisions depend upon factors such as: Changes in Market Demand Competitive Action & Reaction Marketing Influences Product Influences Financial Influences

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PRODUCT PERSONALITY AND ITS COMPONENTS

A product is a physical good that is marketed usually for a profit. A product's personality is it's usability, performance, appearance, and benefits.

Products carry meanings with them and project distinctive images.

These meanings and images arise out of the many components that make up the product personality.

Beyond their functional utility products have a symbolic meaning.

Parts of this symbolic meaning are accounted for by concepts like brand personality and product-user image, which describe the symbolic meaning associated with the brand or product class. However, the physical product also carries symbolic meaning. That part of the symbolic meaning that refers to the physical product itself, and is described with human personality characteristics, is called product personality.

COMPONENTS OF PRODUCT PERSONALITY

The core or the basic constituent

The package and label

The associated features

The brand name and logo

1.Core Components
The core or the basic constituent of the product is the first component in its total personality.

The first lesson in product management is that the basic product constituent has to be good for the total product personality to be effective. All subsequent steps like differentiation; positioning and innovative selling methods can shine only on a good basic product, a product that possesses quality.
No firm can build up a good product personality when the basic product constituent is sub-standard.

Eg. Fragrance and colour of Mysore sandal soap is disntinct

2.Brand Name
A brand is defined as a name, term, symbol, design, or a combination of them, which is intended to identify the goods and services of one seller and to differentiate them from those of competitors. In marketing, the brand name is a major selling tool and one of the most important components of the total personality. We live in the age of brands.

The brand name is the mantle the product puts on.

The brand mage, developed through advertising and other promotional measures, creates strong brand awareness and loyalty among consumers.

Corporations spend long years, lot of money and effort to build brands. A good brand is an invaluable asset for the owner.

Eg. Consumers ask for colgate tooth paste, not just tooth paste

3. Package and Label

The package is important component of the total product personality,

Label is part and parcel of a package. A label provides written information about the product.

The package performs two essential roles:

Giving protection to the product. Adding to its aesthetics and sales appeal.

There are grade labels and descriptive labels.

Grade: Products are classified into A, B, C or 1, 2, 3 categories based on quality. Descriptive : for branded products, furnishing detailed information about products attributes and qualities. Statutory Labelling : Laid down by law eg. Cigarettes .

The material of the package, the color, the shape and size of the package, its finish, the labeling on it, the possibilities of reuse etc.

The power of good packaging in prompting on-the-spot purchases is found to be very substantial.

Labelling helps the buyer to understand the nature of the products, its distinctive features, its composition, performance etc.

4. The Associated features

The total personality of the product is not decided by these elements alone. They make the initial impact on the customer. The remaining 3Ps of the marketing mix namely, the Price, Place (channel) and Promotion are crucial elements deciding the total product personality. Here, it is sufficient to point out that the total product personality is the end result of an astute management of all the four Ps of marketing.

PRODUCT DIFFERENTIATION
Product Differentiation is the process of distinguishing a product from competitors by adding New Utilities.

Differentiation by Form. Glycerin contents. Transparent soap. Stands for gentleness and purity. Generally focuses on women and children segment. Differentiation by Form Thinner than normal cans Easy to handle Stylish in appearance Targeting youth Digital Marketing Campaign.

Differentiation by form.
Easy to carry kit. Suitable for packages of 2 liter and more.

Packaging Advantage over Competitors. Largest selling mineral Water in India.

Differentiation by Form. Lifestyle television channel. Area of Interest : Travelling, Fashion, Fitness, Indian marriage and Leisure. Catering to young, urban Indians.

Differentiation by Features. Range of 100% natural with Natural Herbs. No chemical base used. Punch line -purity and safety. Promotes Indian values. Priced higher than competitors. Targets high classes both youth and mature.
Differentiation by Features. Added herbals with tea. Available in natural flavors of ginger, Indian ginseng, liquorice, cardamom and basil. Positioning tea as health drink. Tag line Pyaar ka Pyaala sehatwaala

Targeted at family consumers

young, mature and old, seeking wellness .

Differentiation by Customization.
- Can be customized to users specifications - Can download desired applications - 1000s of applications available online - Best pocket gadget.

Differentiation by Durability. Stands for strength. Rough and Tough use. Symbol of Masculinity. Targets Adventure loving consumers.

Differentiation by Durability. Best in battery life Designed to supply longer life in digital cameras Twice the number of photos typically achievable with alkaline batteries

Differentiation by Reliability.
150000 miles without trouble for sure Service available 24x7 Road side assistance program 3 years

Turn a Merc upside down and get money back

Differentiation by Reliability
Trusted product for locks

Synonymous with trust, protection and integrity

Implementation of latest technology and constant

innovation

Differentiation by Quality. Mac Book is aimed at the consumer and education markets. Single best-selling laptop of any brand in U.S. retail stores for the precedingfive months. Uses a unibody polycarbonate Combination of polycarbonate and fiber glass casing that was modeled after the iBook G4.

Differentiation by Performance Quality Worlds most-preferred Search Engine. Comprehensive data search on web with real pace. Other Feature include : Images, News, Maps, Weather forecasts, Stock quotes, time zones and sports scores.

Differentiation by Style.
Stylish watches and sunglasses Against the common belief that style comes with

price Style without compromising quality Varieties like hiphop, denim, biker, army, sports

Differentiation by Status/Style.

Globally one of the most valuable brand. Regarded as status symbols. Luxury Product. Priced high to maintain exclusivity. Catering to Upper classes, Affluent Consumers.

Differentiation by service.

Challenges for delivery in 30 min. Large area covered in different cities. Fast and hot pizzas for sure. Capturing market because of its home delivery service. Targets Middle and upper Middle, urban consumer.

Differentiation by Price.
Tag line : isse sasta aur achha kahi nahi! Wednesday Bazaar. Weekly sale. Bulk Purchasing, Bulk Discounts. Largest retail chain in India. Sabse Saasta din- 26 Jan.- Yearly sale.

Targets Lower and Middle Classes.

Differentiation by service. Challenges for delivery in 30 min. Large area covered in different cities. Fast and hot pizzas for sure. Capturing market because of its home delivery service. Targets Middle and upper Middle, urban consumer. Differentiation by Service. Worldwide chain of hotels and resorts. Outstanding hospitality to its guests. Well known for its level of customization for customers. Popular among international tourists, especially from Europe and US.

PRODUCT POSITIONING
Product positioning refers to the place an offering occupies in consumers minds on important attributes relative to competitive products.

WHAT IS POSITIONING OF A PRODUCT?

Positioning is owning a piece of consumers mind Positioning is not what you do to a product
Its what you do to the mind of the prospect

You position the product in the prospects mind

Its incorrect to call it Product Positioning Ries & Trout

EXAMPLES INCLUDE:
Colgate is Protection Lux is Glamour Ponds DFT is Confidence Axe is Sexual Attraction Gillette is Quality

WHY?
The assault on our mind

The media explosion The product explosion

The advertising explosion

So little message gets through that you ignore the

sender and concentrate on the receiver

HOW?
The easy way to get into a persons mind is to be first
Xerox, Kodak, Polaroid, Sun TV, The Hindu, F&L

If you didnt get into the mind of your prospect first, then you have a

positioning problem
Better to be first than be best

In the positioning era, you must, however, be first to get into the

prospects mind
The basic approach is not to create something new or different, but

manipulate whats already in the mind

To find a unique position, you must ignore conventional logic Conventional logic says you find concept inside product
Not true; look inside prospects mind

KEY INSIGHT
Key Insight is seeing below the surface / seeing inside the consumer Insight expresses the totality of all that we know from seeing inside the consumer An insight is a single aspect of this that we use to gain competitive advantage

That the brand can either solve a problem or

By identifying a specific way

Create an opportunity for the consumer

THE 3Cs of Positioning:

Be

Crystal clear

Be Consumer-based
Be relevant and credible to the consumer Write in consumer language and from consumers view point

Be Competitive
Be distinctive Focus on building brand elements into powerful

discriminator Be persuasive Be sustainable

PRODUCT LIFE CYCLE

INTRODUCTION STAGE:

GROWTH STAGE:

MATURITY STAGE:

DECLINE STAGE:

EXTENDING THE PLC:

Purpose: to sell more product and cover original investment
MarketModification
Increase frequency of use by present customers Add new users Find new users

ProductModification

Change product quality or packaging

Extended stages of PLC

Revival Second decline Second Revival

1.Idea Generation and Screening 2.Concept Development and Testing 3.Marketing Strategy 4.Business Analysis

NEW PRODUCT DEVELOPMENT

5.Product Development 6.Test Marketing 7.Commercialization

CAUSES OF NEW PRODUCT FAILURES:

To create successful new products, the company must: Overestimation of Market Size
understand its customers, markets and competitors develop products that deliver superior value to customers.

Product Design Problems

Competitive Actions

Product Incorrectly Positioned, Priced or Advertised

Costs of Product Development

New Product Development Process

Step 1. Idea Generation
Suppliers

Distributors
Competitors Customers Internal sources

Systematic Search for New Product Ideas

New Product Development Process

Step 2. Idea Screening
Process to spot good ideas and drop poor ones Criteria Market Size Product Price Development Time & Costs Manufacturing Costs Rate of Return

New Product Development Process

Step 3. Concept Development
1. Develop Product Ideas into Alternative Product Concepts

2. Concept Testing - Test the Product Concepts with Groups of Target Customers

3. Choose the Best One

Step 4: Marketing Strategy Statement Formulation

Part One - Overall:

Target Market Planned Product Positioning Sales & Profit Goals Market Share
Part Two - Short-Term:

Products Planned Price Distribution Marketing Budget

Part Three - Long-Term:

Sales & Profit Goals Marketing Mix Strategy

New Product Development Process

Step 5. Business Analysis Step 6. Product Development
Business Analysis Review of Product Sales, Costs, and Profits Projections to See if They Meet Company Objectives

If No, Eliminate Product Concept

If Yes, Move to Product Development

New Product Development Process

Step 7. Test Marketing
Standard Test Market
Full marketing campaign in a small number of representative cities.

Controlled Test Market

A few stores that have agreed to carry new products for a fee.

Simulated Test Market

Test in a simulated shopping environment to a sample of consumers.

What is Product Management?

Definition
Managing the various product lines/products and the

overall product mix of the company.

Product management is an organizational lifecycle

function within a company dealing with the planning, forecasting, or marketing of a product or products at all stages of the product life cycle.
The role consists of Product development and product

marketing.

A product at different levels

The Potential product

The Augmented product

The customized product The differentiated product The branded product

The generic product

Main tasks in Product management

Appraisal of each product line and each product/brand in the line Decisions on Packaging

Product differentiation and positioning

Managing brands and developing brand equity

New product development

Managing product quality

Managing the PLC of products/ brands

 Quality A major concern in many organizations Why is quality stressed upon more these days?

Because
Intense foreign competition More demanding customers

Reduced market share

Higher costs

Definition: Total quality Management (TQM) is a philosophy that uniform commitment to quality in all areas of the organisation will promote a culture that meets customers perceptions of quality

Significance of the term TQM

Total The responsibility for achieving Quality rests with everyone. It recognizes the necessity to develop processes across the business, that together lead to the reliable delivery of exact, agreed customer requirements. This will achieve the most competitive cost position and a higher return on investment.

Quality The prime task of any business is to understand the needs of the customer, then deliver the product or service at the agreed time, place and price, on every occasion. This will retain current customers, assist in acquiring new ones and lead to a subsequent increase in market share.

Management Top management lead the drive to achieve quality for customers, by communicating the business vision and values to all employees; ensuring the right business processes are in place; introducing and maintaining a continuous improvement culture

Basic principles of TQM

TQM is founded on three basic principles: 1. 2. 3.

Continuous quality improvement Empowered employees Quality improvement teams

Continuous quality improvement

Built around the notion that

Quality is free Not having high quality goods and services can be very expensive Screening out of bad products Building quality from the very beginning Benchmarking: A primary tool The case of Ford Taurus

Empowered employees
Employee recruitment, selection and training

critical to the success of marketing implementation Empowerment: Authority & responsibility to make marketing decisions on their own Success depends on an overall corporate vision, shared goals and a culture that supports the TQM effort Providing control mechanisms to maintain productivity and quality The Ritz Carlton hotels case

Quality improvement teams

To get the best and the brightest on a quality

improvement issue. Involvement of suppliers and customers.

Some TQM standards

The Deming Prize
Malcolm Baldridge National Quality Award Rajiv Gandhi National Quality Award

Benefits of TQM
Lowering operating costs
Higher returns on sales and investment Improved ability to use premium pricing Faster development of innovations Improved access to global markets Customer retention Enhanced reputation

Rashtriya Ispat Nigam Limited (Vizag Steel Plant)

One of the leading public sector enterprises under the

Ministry of Steel, Government of India Inception of TQM cell in 1995

Increase in sales per year from Rs. 3263.66 cr to Rs.

7867.6 cr

Reduced manufacturing expenses from.

Rs. 3,94,706.6 cr to Rs. 3,46,158.86 cr

Reduced net loss incurred by the company from Rs.

6,97,525.90 cr to Rs. 4,00, 94.58 cr

 Accident rates reduced from 113 to 107 (both fatal and

non-fatal)

Customer complaint rates from 0.27 to 0.13 (of total

sales)

Pharmaceutical

product

management

Features
Some large pharmaceutical companies Home-grow

their own brand of product managers.

Some companies follow the policy of Job rotation But of late, recruitment of post graduates in Pharmacy In many companies, product managers are not given

specific responsibilities and access to data

 Lukewarm or Moderate participation in planning

Less involvement in briefing or developing campaigns No systematic appraisal or evaluation Little focus on the Big picture

Case: Plight of a product manager!

Major responsibilities
Preparing detailing stories
Preparing sampling strategy Fieldwork with representatives Analyzing the retail store audit and presenting Analyzing the sales performance Briefing the field force Follow-up with suppliers

BRANDING
DESCRIPTION

BRANDING
DESCRIPTION

Brand
American Marketing Association defines Brand as

Name, symbol or design intended to identify the goods and services of one seller or group of sellers and to diffrentites them from those of competitiors
Brand=Product+Image Lux=Toilet

Soap+Film Stars+Beautiful Skin+Fantasy Element (looking like a film star)+confidence..

Brand is considered to be a promise. Brand management is

nothing but an art of creating and sustaining the brand

Some Famous Brands

Brand Name Disney Wal Mart Fed Ex Toyota Apple Associated With Family, Fun and Entertainment Low Prices, Good Values Guaranteed overnight delivery Reliablity Innovation

Strategic Functions of a brand

Sign of Ownership A Strategic Device

Tool for differen tiation

A Legal Tool

Strategic Functions of a Brand

Sign of functon al capaility

A Risk Reducer

Symboli c Device

Brand Name relevance

Brand Name is the first point of contact between the mind and the

message. It is believed to be a knife that cuts the mind in order to let the message inside.
Helps the customers to identify and differentiate one product from

another.

It can easily be noticed and its meaning can be stored and triggered in the memory instantly. Requires a lot of research.

Brand names are not necessarily associated with the product.

They can also be based on: Places (Air India, British Airways) Animals or birds (Dove soap, Puma) People (Louise Phillips, Allen Solly)

features of a good Brand Name

It should be unique / distinctive (for instance- Kodak, Mustang)

It should be easy to pronounce, identified and memorized. (For

instance-Tide) It should give an idea about products qualities and benefits (For instance- Swift, Quick fix, Lip guard). It should be easily convertible into foreign languages. It should be capable of legal protection and registration. It should indicate concrete qualities (For instance Firebird). It should not portray bad/wrong meanings in other categories. (For instance NOVA is a poor name for a car to be sold in Spanish country, because in Spanish it means doesnt go).

Brand attributes
Relevancy

It must meet peoples expectations and should perform the way they want it to. One has to persuade consumers to buy the product; else inspite of your product being unique, people will not buy it.

A consistent brand signifies what the brand stands for and builds customers trust in brand. A consistent brand is where the company communicates message in a way that does not Consistency deviate from the core brand proposition.

Proper Positioning

A strong brand should be positioned so that it makes a place in target audience mind and they prefer it over other brands.

A strong brand makes a business competitive. A sustainable brand drives an organization towards innovation and success. Sustainable Example of sustainable brand is Marks and Spencers.

Brand attributes
A strong brand should do what it promises. The way you communicate your brand to the customers should be realistic. It should not fail to deliver what it promises. Do not exaggerate as customers want to believe in the promises you make to them.

Credibility

Uniqueness

A strong brand should be different and unique. It should set you apart from other competitors in market.

Inspirational

strong brand should transcend and inspire the category it is famous for. For example- Nike transcendent Jersey Polo Shirt.

Marketing Sense from Branding

Retrieve Information
Summarizes information that the customer finds useful to adhere to the products of the company in the future as well.

Differentiate

Helps in differentiating the image of the product from other similar products being offered by the others

Reasons to buy

Generates confidence in the product attributes, customer benefits and increases the credibility

Basis for brand extension

Generates more product opportunities' for the other extended versions of similar products and also new, differentiated products

Brand positioning

Positioning is owning a piece of the customers mind. Eg: Colgate- Protection. Gilette- Quality Axe-Attraction There are many assaults on the consumer psyche today namely Product Explosion ,Advertising Explosion and Media Explosion. The only way by which the one can get into the minds of the consumers is by getting there first. It has an unaided top of mind recall.

A well crafted brand position has the following three primary components: A definition of the business your company is in and the industry and category it competes in. A definition of the target market you wish to pursue. A statement of your point of differences and key differences that set you apart from the competition.

Brand positioning

Activity of creating a brand offer in such a manner that it occupies a distinctive place and value in the target customers mind. For instance-Kotak Mahindra positions itself in the customers mind as one entityKotak - which can provide customized and one-stop solution for all their financial services needs. It intends to stay with the proposition of Think Investments, Think Kotak. Brand Positioning is the key of marketing strategy. A strong brand positioning directs marketing strategy by explaining the brand details, the uniqueness of brand and its competitve advantage over the competitive brands, as well as the reasons for buying and using that specific brand. Positioning is the base for developing and increasing the required knowledge and perceptions of the customers. It is the single feature that sets your service apart from your competitors. For instance- Kingfisher stands for youth and excitement.

Brand positioning must make sure that: Is it unique/distinctive vs. competitors ? Is it significant and encouraging to the niche market ? Is it appropriate to all major geographic markets and businesses ? Is the proposition validated with unique, appropriate and original products ? Is it sustainable - can it be delivered constantly across all points of contact with the consumer ? Is it helpful for organization to achieve its financial goals ? Is it able to support and boost up the organization ?

Brand positioning
Errors related to Positioning of a Brand:

Under positioning- This is a scenario in which the customers have a blurred and unclear idea of the brand. Over positioning- This is a scenario in which the customers have too limited a awareness of the brand. Confused positioning- This is a scenario in which the customers have a confused opinion of the brand. Double Positioning- This is a scenario in which customers do not accept the claims of a brand

Guidelines for positioning a brand

Start by not only looking at the product but by also the target segment that comp wants to occupy

The brand should answer the main Q of the consumers: What will it do for me? And Why should I believe you?

Try to keep the approach short and be as specific as possible. Make every word count.

Keep the positioning up to date and introduce changes as and when required

Look for key insights

Examples of key insights

Key Insight: I wish to marry a handsome prince.

Examples of key insights

Key Insight: Soap leaves my skin feeling dry

Brand identity

Brand identity is the aggregation of what all the organization does. It is an organizations mission, personality, promise to the consumers and competitive advantages. It includes the thinking, feelings and expectations of the target market/consumers. The brand can be perceived as a product, a personality, a set of values, and a position it occupies in consumers minds. Brand identity is all that an organization wants the brand to be considered as. An organization having unique brand identity have improved brand awareness, motivated team of employees who feel proud working in a well branded organization, active buyers, and corporate style. It leads to brand loyalty high credibility good prices good financial returns

Brand identity

Brand identity should be futuristic, it should reveal the associations aspired for the brand. Brand identity is a basic means of consumer recognition and represents the brands distinction from its competitors. Sources of brand Identity: 1. Symbol: Symbols help customers memorize organizations products and services. Symbols are easier to memorize than the brand names as they are visual images. Eg: Marlboro has its famous cowboy, Duracell has its bunny rabbit 2. Logo:A logo is a unique graphic or symbol that represents a company, product, service, or other entity. Logotype - It can be a simple or expanded name. Examples of logotypes including only the name are Kelloggs, Hyatt, etc. Icon - It is a name or visual symbol that communicates the essence of the company. For example-LIC hands, Slogan - It is best way of conveying companys message to the consumers. For instanceNikes slogan Just Do It. 3. Trademark

Brand image

Brand image is the current view of the customers about a brand. It can be defined as a unique bundle of associations within the minds of target customers. It signifies what the brand presently stands for. It is a set of beliefs held about a specific brand. It is the representative of the : consumers perception about the product. Emotional value of the consumer in relation to the product. The way in which a specific brand is positioned in the market

The main elements of positive brand image are: unique logo reflecting organizations image slogan describing organizations business in brief brand identifing elements

Brand image

An image is formed about the brand on the basis of subjective perceptions of bundle that the consumers have about the brand. Volvo is associated with safety. Toyota is associated with reliability. Brand images should be positive, unique and instant. Brand images can be strengthened using brand communications like advertising, packaging, word of mouth publicity, other promotional tools, etc The brand image consists of various associations in consumers mind attributes and benefits Brand attributes -Brand attributes are consumers overall assessment of a brand.. Brand BenefitsThere are three types of benefits: Functional benefits - what do you do better emotional benefits - how do you make me feel better rational benefits/support - why do I believe you. Brand attributes are consumers overall assessment of a brand.

Brand Identity vs Brand Image

Brand Identity Brand identity develops from the source or the company. Brand message is tied together in terms of brand identity. The general meaning of brand identity is who you really are? Its nature is that it is substance oriented or strategic. Brand identity symbolizes firms reality. Brand identity represents your desire. It is enduring. Identity is looking ahead. It signifies where you want to be. It is total promise that a company makes to consumers. Brand Image Brand image is perceived by the receiver or the consumer. Brand message is untied by the consumer in the form of brand image. The general meaning of brand image is How market perceives you? Its nature is that it is appearance oriented or tactical. Brand image symbolizes perception of consumers Brand image represents others view It is superficial. Image is looking back. It signifies what you have got. It is total consumers perception about the brand.

Brand building tools

Advertisem ents

Brandsites

Sponsorships

Brand

PR

Sales promotion

Brand leveraging
A powerful brand established by a company can be further leveraged by the

company can: Line Extension techniques: Brand Extension Techniques:

Line Extension: Refers to formation of newer products in the same brand range thus extending the scope o the brand within the same product category. The newer products cater to new sections of market even though the core values remain the same. Eg: Taste-Maggi

Ingredients:colgate toothpaste. These leveraging techniques helps in combating competition. Risks involved are those of: Over segmentation decrease in brand loyalty, sacrifing the creation of a new brand altogether Can cause error in demand forecasting and ma end up inc inventory costs

Brand leveraging
Brand Extension: Refers to utilization of brand name established in one

product category and applying it to a new product category. Involves in formation of Umbrella Brand Types: 1. Same product in different form.eg: Gillete 2. Companion product to go along the parent product.eg:Pepsodent toothpaste to go along a Pepsodent toothbrush 3. New produt catering to same target market.eg: Visa credit card and visa travel cheques.provided by service brands who want to be total service providers. 4. Tranfer of core competence to new product.eg:Lakme beauty salons
Risks: Lack of fit between core values and brand extension. Extending an immature brand is undesirable. Customers may percieve the company incompetent products.

of producing newer

Cannabilizes parent prdt share rather than eating up competitor share.

Brands are created as buyers crave information. They come across a wide variety of products which look the same and perform similar functions.Brand is an entity which in turn helps them to choose the most desirable product.

Branding thus acts as a signal which helps the customer make the right choices

BRAND AWARENESS
- Dfinition - Types - Significance

DEFINITION :
Brand awareness is the probability that consumers are

familiar about the life and availability of the product. It is the degree to which consumers precisely associate the brand with the specific product. Measured as ratio of niche market that has former knowledge of brand Includes :
Brand Recognition Brand Recall

Brand Recognition

Ability of consumer to prior knowledge of brand when they are asked some questions about that brand or when they are shown that specific brand Consumer can clearly differentiate the brand as having being earlier noticed or heard Potential of customer to recover a brand from its memory when given a product class/category, needs satisfied by that category or buying scenario as a signal Consumer should recover the brand from memory when given a clue.

Brand Recall

 Brand awareness can be improved by right choice of

Brand name:
Simple Easy to pronounce or spell Known and expressive Unique and distinct

Example: Coca Cola popularly known as Coke

Types of Brand Awareness

Aided Awareness

Top of mind awareness

Aided Awareness: On mentioning the product category, the customers recognize your brand from the lists of brands shown. Top of mind Awareness: On mentioning the product category, the first brand that customer recalls from his mind is your brand.

SIGNIFICANCE OF BRAND AWARENESS: Essential for building Brand Equity Strong brand awareness leads to high sales and high market share Means through which consumers become acquainted and familiar with a brand and recognize that brand.

BRAND LOYALTY
- Dfinition - Developing brand loyalty - Significance

DEFINITION
Brand Loyalty is a scenario where the consumer

fears purchasing and consuming product from another brand which he does not trust. Can be measured by:
Word of mouth publicity Repetitive buying Price sensitivity Commitment Brand trust

Customer Satisfaction

FEATURES OF BRAND LOYAL CUSTOMERS: Even if the other brands are available at cheaper price or superior quality, the brand loyal consumer will stick to his brand. Consumers remain loyal to a specific brand as long as it is available. Brand loyal consumers are the foundation of an organization. Brand loyal consumers are the foundation of an organization. Willing to pay higher price for that brand Will promote their brand always

DEVELOPING BRAND LOYALTY: Measures: Quick service Ensuring quality products Continuous improvement Wide distribution network Brand Loyalty is always developed post purchase Requirement for developing loyalty:

Knowledge about niche market Targeting Support the product Ensuring easy access Customer satisfaction Constant innovation in product Offering Schemes

SIGNIFICANCE OF BRAND LOYALTY: Greater loyalty levels lead to less marketing expenditure because the brand loyal customers promote the brand positively Acts as a means of launching and introducing more products that are targeted at same customers at less expenditure. Restrains new competitors in the market. Company having brand loyal customers will have greater sales, less marketing and advertising costs, and best pricing.

BRAND ASSOCIATION
- Dfinition - How Brand Associations are formed

DEFINITION
Brand Associations are not benefits, but are images and

symbols associated with a brand or a brand benefit Examples: Nokia sound, Film Stars as with Lux, signature tune Ting-ting-ta-ding with Britannia, Blue colour with Pepsi Associations are not reasons-to-buy but provide acquaintance and differentiation thats not replicable It is relating perceived qualities of a brand to a known entity. Positive brand association helps an organization to gain goodwill, and obstructs the competitors entry into the market.

 Brand associations are the attributes of brand which

come into consumers mind when the brand is talked about. Brand associations are formed on the following basis: Customers contact with the organization and its employees; Advertisements; Word of mouth publicity; Price at which the brand is sold; Celebrity/big entity association; Quality of the product; Products and schemes offered by competitors; Product class/category to which the brand belongs; POP ( Point of purchase) displays; etc

BRAND PROMISES
- Dfinition and significance - Three mistakes made by business owners

DEFINITION
Brand promise is what you say to the customer and what
is to be delivered. If you are not able to deliver the brand promise you will not be able to meet the expectations that have been created in the customers mind. Hence your business will either flounder or die. There are three major mistakes that the business leaders make while executing and developing the brand promise: Refuse to recognize the customer expectations Implement a system which gives a negative experience to the customer. Unable to hire best candidate

BRAND EQUITY
-Defintion -Brand Equity Models -Building Brand Equity -Measuring Brand Equity -Managing Brand Equity

DEFINITION
Brand Equity is the added value endowed on products and services.

It is the value and strength of the Brand that decides its worth.
Understanding Brand Equity:
Customer based brand equity:

The differential effect that brand knowledge has on consumer response to the marketing of that brand Positive customer based brand equity Negative customer based brand equity Key ingrdients of customer based brand equity: Brand equity arises from difference in consumers response Brand Knowledge of consumer Perception, preferences and behavior towards marketing aspects of brand

BRAND EQUITY MODELS Brand Asset Valuator: Provides comparative measure of the brand equity of thousands of brands across hundreds of different categories 5 key components: Differentiation Energy Relevance Esteem Knowledge

BRANDZ MODEL:
Brand building

follows a sequential series of steps

BRAND RESONANCE MODEL: Brand building has ascending series of steps:Ensuring identification of brand Establishing the totality of brand meaning Eliciting proper customer responses Creating loyalty
These steps lead to brand resonance pyramid

 Brand Salience: how often and how easily customer think

of brand under various purchase and consumption situation Brand Performance: how well product meets customers functional needs Brand Imagery: Ways in which brand attempts to meet psychological and social needs Brand Judgement: focus on customers own personal opinion and evaluation Brand Feeling: customers emotional responses and reactions w.r.t brand Brand Resonance: nature of relationship customer have with brand and extent to which they are in sync with it

BUILDING BRAND EQUITY: Drivers of brand equity: Initial choices of brand elements or identities making up the brand The product and service and all accompanying marketing activities and supporting marketing programs Other associations indirectly transferred to the brand by linking it to some other entity( a person, place or thing)

Step 1: Choosing Brand Elements: Brand elements are those trademarkable devices that identify and differentiate the brand Brand element choice criteria: Memorable: how brand can be easily reacalled Meaningful: is brand element credible and suggestive of corresponding category Likable: how aesthetically appealing is the brand element Transferable: can the brand element be used to introduce new products in same or different categories Adaptable: how adaptable and updatable id brand element Protectible: how leagally protectible

 Developing brand elements: Brand elements should be easy to recognize and recall and inherently descriptive and persuasive Brand names are the only important brand elements. Less concrete brand benefits are, the more important that brand element capture intangible characteristics Slogans are extremely efficient means to build brand equity Examples: The Complete Man- Raymonds Gods Own Country- Kerala Tourism

Step 2: Designing Holistic Marketing Activities Brand Contact: Any information-bearing experience, whether positive or negative, a customer has with the brand, the product category, or the market that relates to the marketers product or service Customer comes to know about a brand in many ways:
Advertisements Personal observation and use Word of mouth Interaction with company personnel

Online and telephonic experiences

Payment transactions

Themes on designing brand building marketing programs

Personalization:
Personalized marketing is about making sure the brand and its

marketing are as relevant as possible to as many customers as possible- a challenge given that no two customers are identical Experiential Marketing uses brand relevant experiences to appeal to both the rational and emotional buying triggers of the intended audience. One to one marketing Permission marketing: The practice of marketing to customers only after gaining their express permission Participatory marketing: marketers and consumers work together to find out how firms can best satisfy consumers

 Integration:
Integrated marketing is about mixing and matching marketing

activities to maximize their individual and collective effect. To achieve it, marketers need a variety of different marketing activities that reinforce the brand promise Effectiveness and efficiency affect brand awareness and create, maintain or strengthen brand image. Identity is the way a company aims to identify and position itself and its product Image is a way the public actually perceives them For right image to be established the marketer must convey brand identity through every available communication vehicle and brand contact Different marketing activities have different strengths and can accomplish different objectives. The effect of any one option can be enhanced or complimented by the presence of others

 Internalization: Internal Branding : activities and processes that help to inform and inspire employees Brand promise will not be delivered unless evreryone in the company loves the brand Such activities lead to brand bonding

Principles of Internal Branding Bring the brand alive for employees

Choose the right moment

Link internal and external marketing

Step3: Leveraging Secondary Associations: Creating the brand equity by linking the brand to other information in memory that conveys meaning to the consumer It can link the brand to:
The company (through branding strategies) The geographical regions (through identification of product

origin) The channels of distribution (through channel strategy) Other brands (through co-branding) Characters (through licensing) Spokespeople ( through endorsement) Sporting and cultural events ( through sponsorship)

Secondary sources of brand knowledge

MEASURING BRAND EQUITY Indirect Approach: Assesses potential sources of brand equity by identifying and tracking consumer brand knowledge structures Direct Approach: Assesses the actual impact of brand knowledge on consumer response to different aspects of marketing Marketer need to fully understand :
Sources of brand equity and how they affect outcome of

interest How these sources and outcome change over time

 Brand Audit: consumer focused series of procedures

to assess the health of the brand, uncover its sources of brand equity and suggest the ways to improve and leverage its equity Brand Tracking Studies: collect quantitative data from consumers on routine basis over time to provide consistent, baseline information about how their brands and marketing programs are performing on key dimensions Brand Valuation: estimating total financial value of brand

MANAGING BRAND EQUITY: Brand Reinforcement:

Reinforcing brands involves ensuring innovation in

product design, manufacturing and merchandising and ensuring relevance in user and usage imagery
Brand Revitalization: To recover and reposition brand in mind of consumer when it is not working successfully is know as Brand Revitalization.

BRAND EXTESION: Brand Extension is the use of an established brand name in new product categories. A renowned/successful brand helps an organization to launch products in new categories more easily. An existing brand that gives rise to a brand extension is referred to as parent brand Advantages of Brand Extension:
It makes acceptance of new product easy. There are feedback benefits to the parent brand and

the organization.

 Disadvantages of Brand Extension:

Brand extension in unrelated markets may lead to loss of

reliability if a brand name is extended too far. An organization must research the product categories in which the established brand name will work. There is a risk that the new product may generate implications that damage the image of the core/original brand. There are chances of less awareness and trial because the management may not provide enough investment for the introduction of new product assuming that the spin-off effects from the original brand name will compensate. If the brand extensions have no advantage over competitive brands in the new category, then it will fail.

BRAND PORTFOLIOS: Set of all brands and brand lines a particular firm offers for sale in a in a particular category or market segment Reasons for including multiple brands:
Increase shelf presence and retailer dependence in store Attracting consumer seeking variety Increasing internal competition Yielding economies of scale in advertising, sales,

merchandising and physical distribution

CUSTOMER EQUITY:
The sum of lifetime values of all customers In layman terms, the more loyal a customer, the more is

the customer equity. Firms like McDonalds, Apple and Facebook have very high customer equity and that is why they have an amazing and sustainable competitive advantage. Made up of 3 components:
Value Equity-customers assessment based on the offer, its price

and its convenience. Brand Equity Relationship equity: Relationship equity is what makes a customer stay back with the preferred brand rather than shift to any other

CO-BRANDING
-

DEFINITION Co branding is the utilization of two or more brands to name a new product. The ingredient brands help each other to achieve their aims Example of co-branding - Citibank co-branded with MTV to launch a co-branded debit card. This card is beneficial to customers who can avail benefits at specific outlets called MTV Citibank club.

Types of Co-Branding: Ingredient co-branding implies using a renowned brand as an element in the production of another renowned brand. The brands which are ingredients are usually the companys biggest buyers or present suppliers. Composite co-branding refers to use of two renowned brand names in a way that they can collectively offer a distinct product/ service that could not be possible individually.

SERVICES AS A PRODUCT

Introduction
Growth of service industry can be attributed to Changing life style Changing world Changing industrial economies Changing population and Changing technology. An important indicator of maturity of an economy.

Definition
A service is any act or performance that one party

offers to another, that is essentially intangible, does not result in the ownership of anything. Its production may or may not be tied to any physical product. Philip Kotler.
An economic activity that creates value and provides

benefits for customers by bringing about a desired change in, or on behalf of, the recipient of the service.

Global Scenario
In 1993 service industry accounted for more than 70%

of GDP in U.K., U.S.A., France.

Currently (2010) the service industry accounts for 23%

of the worldwide trade.

Indian Scenario
LPG has brought about unprecedented changes in the

economic, trade and industrial scenarios.

Currently (2010), the service sector in India accounts

for about 41% of its GDP

Goods v/s Services

Ownership
Inventory Value creation Production process Operational input and output Evaluation Time factor Distribution channels

Characteristics
Intangibility
Inconsistency Inseparability Perishability

Intangibility
No physical attributes

Eg: Degrees printed on visiting card

Marketing problems: Subjectively evaluated Difficult to sample before purchase Cannot be stored Difficulty in pricing Difficulty in displaying or communicating

Intangibility
Solutions: Use tangible clues Use personal sources of information Create a strong image

Inconsistency
Less standardized and less uniform
Variability or Heterogneity

Eg: Indian Airlines Front office manager

Marketing problems: Service standardization and quality control are difficult Errors in service operation

Inconsistency
Solutions: Customization Use machines Training

Inseparability
Cannot be separated from the creator-seller
Co-production Student faculty interaction Isolated production Tele banking Self service ATM Marketing problems : Heterogeneity and quality issues Uncertainty in scheduling

Inseparability
Solutions: Consumer management segregating customers Use multisite location

Perishability
Marketing Problems: Inventory problem Problem of Demand-Supply Management
Solutions: Creative pricing Capacity sharing Development of complementary services Increase in customer participation

Classification of Services
By Industry
By Target Effect Based on Labor intensiveness Based on Skill Level of service provider Based on Degree of Customer Contact

Classification by Industry
Entertainment industry
Education Telecommunications Finance & Insurance Transportation Public utilities Government services Health Business services

Classification by Target Effect

People processing
Mental stimulus processing Possession processing Information processing

Based on Labor Intensiveness

Mechanic
Electrician Labor Plumber Artisan

Based on Skill Level

Teacher
Doctor Engineer Accountant Lawyer

On Degree of Customer Contact

High degree
Moderate degree Low degree

Service Process Matrix

Service Process Matrix

Nature of Service action and recepient of service Tangible actions are directed at peoples bodies Eg: Health care, beauty saloons Tangible actions are directed at Physical goods Eg: Laundry, repair &maintenance Intangible actions are directed at peoples bodies Eg: Education, information Intangible actions are directed at Physical goods Eg: Banking, legal services

Service Process Matrix

Customization and judgement in service delivery High extent of judgement and high cust. Eg: Surgery, taxi High extent of judgement and low cust. Eg: Education, preventive health program Low extent of judgement and low cust. Eg: Public transport Low extent of judgement and high cut. Eg: Banking

STP
Segmentation Geographic segmentation Demographic segmentation Psychological segmentation Volume segmentation Benefit segmentation

STP (cont.)
Targeting Undifferentiated marketing Eg: Stardust magazine current film events & articles of film personalities Differentiated marketing Eg: when promoting loans Concentrated marketing Eg: tourist taxi operators having luxury cars

STP (cont.)
Positioning Market Positioning Psychological Positioning a) Objective positioning b) Subjective positioning Positioning Approaches

Pricing of Services
Cost based pricing method
Value based pricing method Enhancing gross value Low cost leadership Value perception management

Distribution of Services
Supplementary services and core services
Distribution strategy depend upon: Type of service Type of service delivery Degree of flexibility Attitude of customers

Service Quality
Relationship between customer expectation of service

and customer perception of received service Perspectives for quality viewing:

Content Process Structure Outcome

Impact

Tools for Service Quality

Service process control
Statistical process control

The End