Marketing Week 5 Summary & Study Notes

🛍️ What is a Product?

A product is a bundle of tangible and intangible attributes offered to satisfy consumer needs: it can be a good, service, or idea. Key categories include non-durable goods (consumed quickly), durable goods (longer-lasting), and services (intangible activities or benefits).

🧩 The Service Continuum & Service Characteristics

Services can range from mostly tangible to purely intangible. Services are unique because of:

• Intangibility: cannot be touched or inspected before purchase.
• Inconsistency (variability): quality depends on people and context.
• Inseparability: service delivery and provider are often inseparable.
• Inventory (perishability): services cannot be stored for later sale.

🎯 The Total Product Concept

Think beyond the core physical item to include packaging, brand, warranty, support services, and the whole customer experience. This shapes perceived value and positioning.

📦 Packaging & Labeling

Packaging protects the product, aids storage/use, promotes the brand, and can support recycling. Labeling may be persuasive (promotional focus) or informational (helps choice, reduces cognitive dissonance). Regulatory requirements (e.g., nutrition facts, health claims) must be followed.

🧱 Product Items, Lines, and Mixes

• Product item: a distinct offering (individual SKU).
• Product line: group of closely related items.
• Product mix (assortment): all products sold by a company. Key dimensions:
• Width (breadth): number of product lines.
• Length: total number of items across lines.
• Depth: variations per item (sizes, flavors, colours).

🛍️ Types of Consumer Products

Four main types with different marketing needs:

• Convenience products: low price, frequent purchase, wide distribution, low shopper effort (e.g., snacks).
• Shopping products: consumers compare alternatives; more selective distribution.
• Specialty products: strong brand preference, unique attributes, limited distribution.
• Unsought products: consumers don’t think of regularly (e.g., insurance); require personal selling/awareness efforts.

🔖 Branding — Definitions & Benefits

Branding: a name, phrase, symbol, or design that identifies a seller’s product and differentiates it. Brand is the sum of consumer expectations, feelings, and behaviours associated with it. Benefits include product identification, brand equity, repeat sales, brand loyalty, and easier new-product introductions.

🧭 Brand Strategy Types

• Individual brand: a unique name for a single product category (separate identity).
• Family brand: single name applied across multiple categories (transfers equity).
• Brand extension: using an existing brand name for new goods/services (risks and benefits).
• Sub-brand: combines family brand with its own identity (gives differentiation while leveraging parent strengths).

🛡️ Protecting Brands

• Patents: protect inventions/processes for about 20 years (with maintenance).
• Copyrights: protect written/sound works and communications.
• Trademarks: protect brand names, logos, designs; must be registered where used; typically renewable (example durations vary by jurisdiction).

🌟 Brand Personality & Names

Brand personality is a set of human traits associated with a brand; it helps build emotional connections and loyalty. Brand name guidelines: suggest benefits, be memorable/distinctive, fit the company image, be legally protectable, and be simple.

🏷️ Types of Brands in the Market

• Manufacturer’s brand: producer-owned (national brands).
• Private-label brand: retailer-owned, produced by contractors (e.g., store brands).
• Generic brand: no branding; low-cost alternative.

⏳ Product Life Cycle (PLC) — Stages & Objectives

PLC describes typical stages from launch to decline. Stage-level goals and tactics differ:

• Introduction: few competitors, high costs, limited distribution. Objective: build awareness; use skimming or penetration pricing.
• Growth: rapid sales increase, rising profits, more competitors. Objective: stress differences, expand distribution.
• Maturity: sales growth slows; market saturation; many competitors. Objective: defend market share, extend product line, emphasize value.
• Decline: sales fall; reduced competition. Objective: reduce costs, harvest or discontinue products.

🛠️ PLC Strategies to Extend Life

• Modify the product: improvements or line extensions.
• Modify the market: find new users, increase usage, reposition.
• Reposition the product: change consumer perceptions to meet new needs.

🚀 Importance of New Products

New products sustain growth, replace obsolete items, meet changing consumer needs, and leverage new technologies. However, competitive and technological change tends to shorten lifecycles.

⚙️ Types of New Products by Degree of Innovation

• Minor innovations: small changes; no new learning required by consumers (e.g., reformulated toothpaste).
• Continuous innovations: noticeable change that alters routine but does not require totally new behavior (e.g., new wearable tech).
• Radical (discontinuous) innovations: require new learning and consumption patterns (e.g., voice assistants, self-driving cars).

📈 Adoption Curve (Overview)

Diffusion of innovations typically follows an adoption curve (innovators → early adopters → early majority → late majority → laggards). Marketing approaches differ by adopter segment.

🧭 New Product Development (NPD) Process — Steps

1. New product development strategy: set strategic direction and objectives; align project with company goals.
2. Idea generation: gather ideas from customers, employees, distributors, suppliers, competitors, consultants, and research.
3. Screening and evaluation: narrow ideas to promising concepts; use concept testing (external feedback).
4. Business analysis: forecast sales, costs, profits, market share, and pricing; assess financial viability.
5. Development: turn concept into a prototype; conduct manufacturing and quality tests; meet legal requirements.
6. Test marketing: limited launch in selected areas to evaluate performance; alternatives include simulated tests and computer/Internet simulations.
7. Commercialization: full-scale launch with production, distribution, and marketing; many firms use regional rollouts to reduce risk.

🔎 Risks & Costs in NPD

New-product development is costly and risky: high R&D and marketing costs, potential product failure, write-offs, and damage to company credibility if products perform poorly.

🧠 Where Companies Find New Ideas

Valuable idea sources include customers, employees, distributors, suppliers/vendors, competitors, and research firms/consultants.

🧪 Test Marketing Considerations

Test marketing reveals market reaction but can be costly and alert competitors. Alternatives include simulated laboratory tests, computer simulations, and internet-based tests.

These notes summarize core concepts from Product & Brands and New Product Development: definitions, service properties, product assortment decisions, branding strategy and protection, PLC management, innovation types, and the structured NPD process.