MANAGING PRODUCTS AND BRANDS

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CHAPTER
MANAGING PRODUCTSAND BRANDS
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AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO

• Explain the product life cycle concept.

• Identify ways that marketing executives manage a
  products life cycle.

• Recognize the importance of branding and
  alternative branding strategies.

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AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO

• Describe the role packaging, labeling, and
  warranties have in the marketing of a product.

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THE PRODUCT LIFE CYCLE

• Product Life Cycle

• Introduction Stage

• Primary Demand

• Selective Demand

• Skimming Pricing Strategy

• Penetration Pricing Strategy

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FIGURE 11-1 How stages of the product life cycle
relate to a firms marketing objectives and
marketing mix actions
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FIGURE 11-2 Product life cycle for
thestand-alone fax machine for business use
19702006
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THE PRODUCT LIFE CYCLE

• Growth Stage

• Repeat Purchasers

• Maturity Stage

• Decline Stage

• Deletion

• Harvesting

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MARKETING NEWSNET
Will E-Mail Spell Doomfor the Familiar Fax?
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THE PRODUCT LIFE CYCLE

• Some Dimensions of the Product Life Cycle

• Length of the Product Life Cycle

• Shape of the Product Life Cycle

• Generalized Life Cycle

• Fashion Product

• High-Learning Product

• Fad

• Low-Learning Product

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FIGURE 11-3 Alternative product life cycles
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THE PRODUCT LIFE CYCLE

• Some Dimensions of the Product Life Cycle

• Length of the Product Life Cycle

• Product Class

• Product Form

• The Life Cycle and Consumers

• Diffusion of Innovation

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FIGURE 11-4 Video game console and software life
cycles by product class and product form
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THE PRODUCT LIFE CYCLE

• Some Dimensions of the Product Life Cycle

• The Life Cycle and Consumers

• Diffusion of Innovation

• Innovators

• Early Adopters

• Early Majority

• Late Majority

• Laggards

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FIGURE 11-5 Five categories and profiles of
product adopters
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Concept Check
1. Advertising plays a major role in the
__________ stage of the product life cycle and
_____________ plays a major role in maturity.
introductory
sales promotion
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Concept Check
2. How do high-learning andlow-learning
products differ?
A A high-learning product requires significant
customer education and thereis an extended
introductory period.A low-learning product
requires little customer education because the
benefits of purchase are readily understood,
resulting in immediate sales.
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Concept Check
3. What does the life cycle of a fashion product
look like?
A It has the four stages, introduction through
decline, and then seems to return. The length of
the cycles may be years.
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MANAGING THEPRODUCT LIFE CYCLE

• Role of a Product (Brand) Manager

• Modifying the Product

• Product Modification

• Modifying the Market

• Market Modification

• Creating New Use Situations

• Finding New Users

• Increasing Use

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MANAGING THEPRODUCT LIFE CYCLE

• Repositioning the Product

• Product Repositioning

• Reacting to a Competitors Position

• Catching a Rising Trend

• Changing the Value Offered

• Trading Up

• Downsizing

• Trading Down

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Concept Check
1. How does a product manager help manage a
products life cycle?
A A product manager shepherds a product through
its life cycle by modifying the product,
modifying the market, and repositioning the
product.
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Concept Check
2. What does creating new use situations mean
in managing a products life cycle?
A Finding new uses for an existing product.
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Concept Check
3. Explain the difference between trading up and
trading down in repositioning.
A Trading up involves adding value to the
product (or line) through additional features or
higher-quality materials. Trading down involves
reducing the number of features, quality, or
price, or downsizingreducing the content of
packages without changing package size and
maintaining or increasing the package price.
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BRANDING ANDBRAND MANAGEMENT

• Branding

• Brand Name

• Trade Name

• Trademark

• Product Counterfeiting

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BRANDING ANDBRAND MANAGEMENT

• Brand Personality and Brand Equity

• Brand Personality

• Brand Equity

• Creating Brand Equity

• Valuing Brand Equity

• Brand Licensing

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FIGURE 11-6 Customer-based brand equity pyramid
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BRANDING ANDBRAND MANAGEMENT

• Picking a Good Brand Name

• Suggest the Product Benefits

• Be Memorable, Distinctive, and Positive

• Fit the Company or Product Image

• Have No Legal or Regulatory Restrictions

• Be Simple and Emotional

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FIGURE 11-B Four criteria for picking a good
brand name
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WEB LINK
Have an Idea for a Brand orTrade Name? Check It
Out
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BRANDING ANDBRAND MANAGEMENT

• Branding Strategies

• Multiproduct Branding (Family/Corporate)

• Line Extension

• Subbranding

• Brand Extension

• Co-Branding

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FIGURE 11-7 Alternative branding strategies
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BRANDING ANDBRAND MANAGEMENT

• Branding Strategies

• Multibranding

• Fighting Brands

• Private Branding (Private Labeling/
  Reseller Branding)

• Mixed Branding

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PACKAGING AND LABELING

• Packaging

• Label

• Creating Customer Value and Competitive Advantage
  Through Packaging and Labeling

• Communication Benefits

• Functional Benefits

• Perceptual Benefits

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PACKAGING AND LABELING

• Global Trends in Packaging

• Environmental Sensitivity

• Health and Safety Concerns

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PRODUCT WARRANTY

• Warranty

• Express Warranties

• Limited Coverage Warranty

• Full Warranty

• Implied Warranties

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FIGURE 11-C Warranty forms
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Concept Check
1. What are the five criteria mentioned most
often when selecting a good brand name?
A The brand name should (1) suggest the product
benefits (2) be memorable, distinctive, and
positive (3) fit the company or product image
(4) have no legal or regulatory restrictions
and(5) be simple and emotional.
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Concept Check
2. Explain the role of packaging in terms of
perception.
A A packages color, shape, and graphics can
connote status, economy, and product quality.
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Concept Check
3. What is the difference between an expressed
and an implied warranty?
A Express warranties are written statements of
liabilities. Implied warranties, which are
unwritten, assign responsibility for product
deficiencies to the manufacturer even if the
retailer sells the product.
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BRAND NEWS YOU CAN USE
GOING ONLINE
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Going Online
1. Visit the brandchannel.com website.Pick a
brand appearing in Chapter 11 and find a feature
or debate pertaining to it either in the archives
or from the current page. Summarize the views
expressed in brandchannel.com.
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Going Online
2. Click the papers icon and read a paper on a
topic covered in Chapter 11. Compare and
contrast the views in this paper with the
coverage found in the chapter.
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DVD PLAYERSFOLLOW THE CLASSIC PRODUCT LIFE
CYCLE
SUPPLEMENTALLECTURE NOTE 11-1
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FIGURE 11-A DVD player product life cycle
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WHATS IN A NAME?ASK THE CALIFORNIADRIED PLUM
BOARD
SUPPLEMENTALLECTURE NOTE 11-2
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BMW NEWNESS ANDTHE PRODUCT LIFE CYCLE
VIDEO CASE 11
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VIDEO CASE 11 BMW
1. Compare the product life cycle described by
BMW for its cars to the product life cycle shown
in Figure 11-1. How are they (a) similar and (b)
dissimilar?
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VIDEO CASE 11 BMW
2. Based on BMWs typical productlife cycle,
what marketing strategies are appropriate for the
3 series?The X5?
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VIDEO CASE 11 BMW
3. Which of the three ways to manage the product
life cycle does BMW utilize with its
productsmodifying the product, modifying the
market, or repositioning the product?
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VIDEO CASE 11 BMW
4. How would you describe BMWs branding
strategy (manufacturer branding, private
branding, or mixed branding)?
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VIDEO CASE 11 BMW
5. Go to the BMW website and design a car to your
specifications. How does this enable you as a
customer to evaluate the product differently than
would be otherwise possible?
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PAMPERED POOCHES TRAVEL IN STYLE
APPENDIX D CASE D-11
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APPENDIX D CASE D-11 Pampered Pooches
1. What product attributes and benefits could an
upscale hotel provide a pet owner? Are these the
same product attributes and benefits provided by
an upscale kennel?
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APPENDIX D CASE D-11 Pampered Pooches
2. What strategy would a company like Petco be
pursuing by entering the pet hotel market? What
strategy would a company like Marriott be
pursuing by entering the pet hotel market?
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APPENDIX D CASE D-11 Pampered Pooches
3. What are the pros and cons of(a) a
multiproduct branding strategy and (b) a
multibranding strategy in the pet hospitality
industry for companies such as (i) Petco and(ii)
Marriott?
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APPENDIX D CASE D-11 Pampered Pooches
4. In what stage of the product life cycle is
the pet hospitality industry? An offering such
as PetsMarts PetsHotels? Explain and support
your answers.
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Product Life Cycle
The product life cycle describes the stages a new
product goes through in the marketplace
introduction, growth, maturity, and decline.
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Product Class
A product class is the entire product category or
industry.
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Product Form
The product form pertains to variations of a
product within the product class.
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Product Modification
Product modification involves alteringa
products characteristic, such as its quality,
performance, or appearance, to try to increase
the products sales.
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Market Modification
Market modification is a strategy in which a
company tries to find new customers, increase a
products use among existing customers, or
createnew use situations.
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Trading Up
Trading up involves adding value toa product (or
line) through additional features or
higher-quality materials.
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Trading Down
Trading down involves reducing the number of
features, quality, or price.
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Downsizing
Downsizing involves reducing the content of
packages without changing package size and
maintaining or increasing the package price.
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Branding
Branding is a basic decision in marketing
products in which an organization uses a name,
phrase, design, or symbols, or combination of
these to identify its products and distinguish
them from those of competitors.
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Brand Name
A brand name is any word, device (design, shape,
sound, or color), or combination of these used to
distinguish a sellers goods or services.
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Trade Name
A trade name is a commercial, legal name under
which a company does business.
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Trademark
A trademark identifies that a firm has legally
registered its brand name or trade name so the
firm has its exclusive use, thereby preventing
others from using it.
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Brand Personality
A brand personality is a set of human
characteristics associated with a brand name.
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Brand Equity
Brand equity is the added value a given brand
name gives to a product beyond the functional
benefits provided.
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Brand Licensing
Brand licensing is a contractual agreement
whereby one company (licensor) allows its brand
name(s) or trademark(s) to be used with products
or services offered by another company (licensee)
for a royalty or fee.
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Multiproduct Branding
Multiproduct branding is a branding strategy in
which a company uses one name for all its
products in a product class.
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Co-Branding
Co-branding is a branding strategy that involves
the practice of the pairing of two brand names of
two manufacturers on a single product.
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Multibranding
Multibranding is a branding strategy that
involves giving each product a distinct name when
each brand is intended for a different market
segment.
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Private Branding
Private branding is a branding strategy used when
a company manufactures products but sells them
under the brand name of a wholesaler or retailer.
Also called private labeling or reseller
branding.
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Mixed Branding
Mixed branding is a branding strategy where a
firm markets products under its own name(s) and
that of a reseller because the segment attracted
to the reseller is different from its own market.
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Packaging
Packaging is a component of a product that refers
to any container in which it is offered for sale
and on which label information is conveyed.
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Label
A label is an integral part of the package that
typically identifies the product or brand, who
made it, where and when it was made, how it is to
be used, and package contents and ingredients.
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Warranty
A warranty is a statement indicating the
liability of the manufacturer for product
deficiencies.
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