Products,Services,andBrandsBuildingCustomerValueChapter7Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-21.Defineproductandthemajorclassificationsofproductsandservices.2.Describethedecisionscompaniesmakeregardingtheirindividualproductsandservices,productlines,andproductmixes.3.Identifythefourcharacteristicsthataffectthemarketingofservices.4.Discussbrandingstrategy—thedecisionscompaniesmakeinbuildingandmanagingtheirbrands.RestStop:PreviewingtheConceptsCopyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-3ProductAnythingthatcanbeofferedtoamarketforattention,acquisition,use,orconsumptionandthatmightsatisfyawantorneed.7-4ServiceAnyactivity,benefit,orsatisfactionofferedforsalethatisessentiallyintangibleanddoesnotresultintheownershipofanything.7-5WhatIsaService?Services:–Servicesareintangible.Examplesincludebanking,hotelaccommodations,airlinetravel,legalservicesandothers.7-6Marketingofferings:–Includesbothtangiblegoodsandservices,aswellascombinationsofboth.•Puregood:soap.•Pureservice:Legalrepresentation.•Combination:Restaurantmeal.Products,ServicesandExperiences7-7MarketinginActionCreatingandmanagingcustomerexperiencesdifferentiatesmarketingoffersfromcompetitors.UmpquaBankdesignsits“stores”tomakebankingapleasurableexperience.Theirbanksfeatureacozycoffeebar,big-screenTVsshowinginvestmentnews,comfyseating,WiFiaccess,andanonlinemusicstore.Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-8Figure7.1:ThreeLevelsofProductCopyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-9LevelsofProductandServicesCorecustomervalue:–Whattheconsumerisreallybuying.Actualproduct:–Includesthebrandname,features,design,packaging,andqualitylevel.Augmentedproduct:–Additionalservicesandbenefitssuchasdeliveryandcredit,instructions,installation,warranty,andservice.Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-10Whendevelopingproducts,marketersfirstmustidentifythecorecustomervaluethatconsumersseeksfromtheproduct.Theymustthendesigntheactualproductandfindwaystoaugmentitinordertocreatethiscustomervalueandthemostsatisfyingcustomerexperience.Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-11MarketinginActionPeoplewhobuyaBlackBerrydevicearebuyingmorethanacellphone.Theyarebuyingtheabilityto“ConnecttoeverythingyouthroughthepoweroftheBlackBerrysmartphone.”Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-12Consumerproducts:–Productsandservicesboughtbyfinalconsumersforpersonalconsumption.–Alsoincludedareothermarketableentities.–Classifiedbyhowconsumersbuythem:•Convenience,shopping,specialty,andunsoughtgoods.ProductandServiceClassificationCopyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-13Conveniencegoods:–Purchasedfrequentlyandimmediatelywithlittlecomparisonshopping.–Lowpriced.–Massadvertisingandpromotion.–Widespreaddistributionwithmanyconvenientlocations.–E.g.,candy,soda,newspapers.TypesofConsumerGoodsCopyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-14TypesofConsumerGoodsShoppingproducts:–Boughtlessfrequently,moreplanningandeffort,brandcomparisonsonbasisofprice,quality,style.–Higherprice.–Selectivedistributioninfewerpurchaselocations.–Advertisingandpersonalsellingisundertakenbybothproducerandreseller.–E.g.,furniture,clothing,cars.Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-15Specialtyproducts:–Strongbrandpreferenceandloyalty,specialpurchasingeffort,littlecomparisonshopping.–Highprice.–Exclusivedistributioninonlyoneorafewoutletspermarketarea.–Carefullytargetedpromotionbybothproducerandreseller.–E.g.,Lamborghini,Rolexwatches.TypesofConsumerGoodsCopyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-16Unsoughtproducts:–Littleproductawarenessorknowledgeofthebrand,sometimesnegativeinterest.–Pricingstrategiesvary.–Distributionstrategiesvary.–Requireaggressiveadvertisingandpersonalsellingbybothproducerandresellers.–E.g.,lifeinsurance,cemeteryplots,blooddonation.TypesofConsumerGoods7-17FuelforThoughtThinkabouthigh-definitiontelevisionsforamoment.Areproductslikelytochangeclassificationcategoriesovertime?Copyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-18Industrialproducts:–Thosepurchasedforfurtherprocessingorforuseinconductingbusiness.–Distinctionbetweenconsumerandindustrialproductsisbasedonthepurposeforwhichanitemisbought(e.g.,homeorbusinessuse).ProductandServiceClassificationCopyright2011,PearsonEducationInc.,PublishingasPrentice-Hall7-19Materialsandparts:–Rawmaterials,manufacturedmaterials,andparts.Capitalitems:–Productsthataidinbuyer’sproductionoroperations.Suppliesandservices:–Operatingsupplies,maintenance,andrepairitems.TypesofIndustrialGoods7-20OtherMarketOfferingsOrganizations:–Profitandnonprofit(schoolsandchurches).Persons:–Politicians,sportsfigures,doctors,etc.Places:–Create,maintain,orchangeattitudesorbehaviortowardparticularplaces.Ideas(socialmarketing):–Publichealthcampaigns,environmentalcampaigns,familyplanning,orhumanrights.Copyright2011,PearsonEducationInc.,PublishingasPrentice-Ha