Marketing Management

Products and Services

Paul Dishman, Ph.D.Department of Business Management

Marriott School of Management

Brigham Young University

Lecture 11

Paul Dishman, Ph.D.

Marketing Management

What is a Product?

• A ProductProduct is anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need.

• Includes:– Physical Objects– Services– Events– Persons– Places– Organizations– Ideas– Combinations of the above

Paul Dishman, Ph.D.

Marketing Management

What is a Service?

• A ServiceService is a form of product that consist of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything.

• Examples include:– Banking– Hotels– Tax Preparation– Home Repair Services

                            

Paul Dishman, Ph.D.

Marketing Management

The Product-Service Continuum

Pure Tangible

Good

Soap

Tangible Good With

Accompanying Services

Auto With Accompanyi

ng Repair Services

Hybrid Offer

Restaurant

Service With

Accompanying Minor Goods

Airline Trip With

Accompanying Snacks

Pure Service

Doctor’s Exam

Paul Dishman, Ph.D.

Marketing Management

Unsought ProductsUnsought Products• New innovations Products consumers don’t want to think about these products Require much advertising &personal selling

Product ClassificationsConsumer Products

Specialty ProductsSpecialty Products• Special purchase efforts High price Unique characteristics Brand identification Few purchase locations

Shopping ProductsShopping Products• Buy less frequently Higher price Fewer purchase locations Comparison shop

Convenience ProductsConvenience Products• Buy frequently & immediately Low priced Many purchase locations

Paul Dishman, Ph.D.

Marketing Management

Product ClassificationsOther Marketable Entities

• Activities undertaken to create, maintain, or change the attitudes and behavior toward the following:– Organizations – Persons– Places– Ideas

Paul Dishman, Ph.D.

Marketing Management

Individual Product Decisions

Product Attributes

Branding

Packaging

Labeling

Product Support Services

Paul Dishman, Ph.D.

Marketing Management

Brand StrategyLine Extensions

Brand ExtensionsMultibrandsNew Brands

Brand StrategyLine Extensions

Brand ExtensionsMultibrandsNew Brands

Brand SponsorManufacturer’s Brand

Private BrandLicensed Brand

Co-branding

Brand SponsorManufacturer’s Brand

Private BrandLicensed Brand

Co-branding

Brand Name SelectionSelectionProtection

Brand Name SelectionSelectionProtection

Major Branding Decisions (Fig. 8.3)

Paul Dishman, Ph.D.

Marketing Management

Brand Strategy

• Line Extension– Existing brand names extended to

new forms, sizes, and flavors of an existing product category.

• Multibrands– New brand names introduced in

the same product category.

• Brand Extension– Existing brand names extended to

new or modified product categories.

• New Brands– New brand names in

new product categories.

Smokey Red BBQ

Paul Dishman, Ph.D.

Marketing Management

Packaging • Activity of designing and producing the container or wrapper for a product.

• Packaging used to just contain and protect the product.

• Packing now has promotional value and marketers should:– Establish a packaging concept,– Develop specific elements of

the package,– Tie together elements to

support the positioning and marketing strategy.

                   

Paul Dishman, Ph.D.

Marketing Management

IntangibilityIntangibility

InseparabilityInseparability

VariabilityVariability

PerishabilityPerishability

Can’t be seen, tasted, felt, heard, or smelled before purchase.

Can’t be separated from service providers.

Quality depends on who provides them and when, where and how.

Can’t be stored for later sale or use.

Nature and Characteristic of a Service

Paul Dishman, Ph.D.

Marketing Management

Satisfied and Loyal

Customers

Satisfied and Loyal

Customers

Greater ServiceValue

Greater ServiceValue

Healthy Service Profits

and Growth

Healthy Service Profits

and Growth

Satisfied and

Productive ServiceEmployees

Satisfied and

Productive ServiceEmployees

Internal Service Quality

Internal Service Quality

The Service-Profit Chain

Paul Dishman, Ph.D.

Marketing Management

Marketing Strategies for Service Firms

• Managing Service Differentiation– Develop differentiated offer, delivery and image.

• Managing Service Quality– Empower front-line employees,– Become “Customer obsessed”,– Develop high service quality standards,– Watch service performance closely.

• Managing Service Productivity– Train current or new employees better,– Work on quality as well as quantity,– Utilize technology.

Paul Dishman, Ph.D.

Marketing Management

Review of Concept Connections

• Define product and the major classifications of products and services.

• Describe the roles of product and service branding, packaging, labeling, and product support services.

• Explain the decisions companies make when developing product lines and mixes.

• Identify the four characteristics that affect the marketing of a service.

• Discuss the additional marketing considerations for services.

Paul Dishman, Ph.D.

Marketing Management

Group Exercise

• Cadbury's wants to introduce a new chocolate bar targeted at 8 to 12 year old boys in America. Please come up with a brand name for the initial plain chocolate bar and then brand names for two additional line extensions. Creativity as well as applicability of the brand name count here. Prepare a professional looking colored overhead transparency with the brand name, logo, or wrapper design to show the class. Due next class period.