Products, Services & Brands

Chapter: 8

Lec: 7b

Product Line Decisions

• Product Line A group of products that are closely related

because they function in a similar manner, are sold to the same customer groups , are marked through the same types of outlets, or fall within given price ranges

• A company can expand its product line in two ways

- Line filling (add more items in line) - Line stretching (upwards/ downwards) e.g. Hotel one, PC, Marriot (downwards) Tata Indigo, upper market car

(upwards)

Product Mix Decisions

• Product Mix

The set of all product lines and items that a particular seller offers for sale

- Product mix has four dimensions

1- Width

2- Length

3- Depth

4- Consistency

Product Mix Decisions• Width The number of different product lines the company

caries e.g. Sony ( TV, play station, camera)• Length Total number of items a company carries in its

product line e.g. digital cameras, camcorders• Depth The number of versions offered of each product in

the line e.g. Flat panel, rear projection, High/low resolution• Consistency How closely related the product line are e.g. Distribution, stores availability

Branding Strategy: Building Strong Brands

• Brand Equity The differential effect that knowing the brand name

has on customer response to the product or its marketing

- brand vary in the amount of power e.g. Song, Nike, Disney, McDonalds- Customer perception dimensions 1) Differentiation (what makes the brand stand out) 2) Relevance (how it meets consumer needs) 3) Knowledge (how much consumer know about

the brand) 4) Esteem (How do consumer respect the brand)

Building Strong Brands

Brand Positioning

Attributes

Benefits

Beliefs and values

Brand name selection

Selection Protection

Brand Sponsorship

Manufacturer’s brand Private Brand Licensing Co-branding

Brand Development

Line extensions

Brand extensions

Multibrands

New brands

Building Strong Brands

• Brand Positioning e.g. Volvo attributes: features of

the car benefit: what you’ll

get out of them (safety)

Belief and values: e.g. Marriot- Luxury rooms

Building Strong Brands

• Brand Name Selection

- can add to a product’s success

- best suited for product category

- should be protected

Building Strong Brands

• Brand Sponsorship There are four

sponsorship options - National Brand: sell

under your own name (Sony Bravia)

- Private Brand: (distributor brand)

- Licensed brands - Co-brand

Brand Sponsorship

• National Brands Vs Store Brands Store Brands A brand created and owned by a

reseller of a product or service e.g. HKB, Al-Fateh - Retailer can select the best place

in store for their brands - Select a lower price as compared

to national brands

Brand Sponsorship

Licensing• Takes years and millions to

create a brand• Some companies license names/

symbols for a fee• Toys based on Tv characters• Characters on clothes, bags etc.

Brand Sponsorship

• Co-branding The practice of using the established

brand names of two different companies on the same product

- you can bring new value for your customers

e.g. Marriot and Barclays Nike and ipod - Complex legal contracts and licenses “Giving away your product is like giving

away your child – you want to make sure everything is perfect”

Brand Development

• A company has four choices when it comes to developing brands

Line extension Extending an existing brand name to new forms,

colors, sizes, ingredients, or flavors of an existing product category

e.g. Bata, regular shoes, sports shoes, sandals etc.

- Geo news, geo super, geo entertainment -An overextended brand name might lose its

meaning - Sale of an extension might come at the expense

of other item

Brand Development

• Brand Extensions Extending an existing brand

name to new product categories

e.g. Maggie Noodles, Maggie soup, Maggie Ketchup

- Ponds tooth paste, Heinz pet food met early death

- Extension may confuse the image of the product

Brand Development

• Multibrands

Companies introduce additional brands in the same category

- Each brand entertains a different segment

- Each brand may obtain a small marketplace

Brand Development

• New Brands

Brand Development Strategies

Line extension

Multibrands

Brand Extension

New Brands

Existing

Existing

New

New

Product Category

Brand Name