BUS 343 Study Guide - Final Guide: Marketing Mix, Customer Service, Toothpaste
30 Jun 2019
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Class 8: Products and Brand
Chapter 8: 274 – 282; 292 - 313 / Chapter 9: 318 – 342 / Chapter 2: 57 – 70
Chapter 8 Developing and Managing Products and Service: p 274 – 282;
292 – 313
LO 1 What is a Product: Define product and describe and classify different types of product
offerings
LO3 The Product Life Cycle: describe the stages of the product life cycle and how marketing
strategies change during the product’s life cycle
LO 4 Products and Service Decisions: describe the decisions companies make regarding their
individual products and services, product lines, and product mixes
LO5 Service Marketing: identify the four characteristics that affect the marketing of services and
the additional marketing -considerations that services require
Chapter 8 Developing and Managing Products and Service: p 274 – 282
LO 1 What is a Product: Define product and describe and classify different types of product
offerings
What is a Product
o Product: Anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a want or need
o Service: An activity, benefit, or satisfaction offered for sale that is essentially intangible
and does not result in the ownership of anything
Products, services and experiences
o Product is a key element in the overall market offering
o Marketing mix begins with building an offering that brings value – this offering becomes
the basis upon which the company builds profitable customer relationship
o A company’s market offering often includes both tangible goods and services.
o the offer may consist of a pure tangible good, such as: soap, toothpaste, or salt –
no services accompany the product
o pure services, for which an offer consists of primarily, or solely, of a service;
credit cards are one example.
o To differentiate their offers, beyond simply making products and delivering services, they
are creating and managing customer experience with their brands or their company
o Experience has always been an important part
o i.e., Disney – dreams; memories; theme parks
o i.e., Starbucks – smell; sound; comfy chairs and sense of community
Organizations, persons, place and ideas
o additional to tangible products and services, marketers have broadened the concept of a
product to include to other market offerings – organizations, person, place and ideas
o organization marketing consists of activities undertaken to create, maintain, or change the
attitudes and behaviour of customers and the general public toward an organization
o both profit & non-profit practice organization marketing
o a person can also be thought as a product – person marketing consists of activates
undertaken to create, maintain, or change attitudes or behaviour toward particular people.
o i.e., politicians, entertainers, sports figures, real estate agents, lawyers
o Place marketing involves activities undertaken to create, maintain or change attitudes or
behaviour toward particular places.
o Cities and countries compete to attract tourists, new residents, conventions,
company offices and factories
o Ideas can be marketed – Idea Marketing
o i.e., Molson runs ads waring of dangers of drunk driving
o i.e., Health Service promotes flu shots when flu season comes around
Levels of products and services
o product marketers need to think about the product they manage as consisting of three
levels, each level adds more value: Core, Actual, Augmented
o The most basic level is the core customer value, which addresses the question
“What is the buyer really buying?” When designing products, marketers must first
define the core problem-solving benefits or services that consumers seek.
o At the second level, product marketers must turn the core benefit into an actual
product—the physical device with all its features and associated brand name and
packaging.
o Finally, marketers must consider the augmented product—the additional
services and benefits that go with it.
▪ example, if the core product of a smartphone is constant connectivity, and
the actual product is an iPhone, then the augmented product is the iPhone
plus a calling plan and data plan.
Products and service classifications (TABLE 8.1)
o Customer products: products purchased by consumer for their personal use
o Consumer products include convenience products, shopping products, specialty
products, and unsought products.
o Convenience products are consumer products and services that customers usually buy
frequently, immediately, and with a minimum of comparison and buying effort.
o Convenience products are distributed through drugstores, grocery stores, and, of
course, convenience stores, and include such things as laundry detergent, candy,
magazines, and fast food.
o Shopping products are less frequently purchased consumer products and services that
shoppers compare carefully on suitability, quality, price, and style. When buying
shopping products and services, consumers spend much time and effort in gathering
information and making comparisons.
o Examples include furniture, clothing, used cars, major appliances, and hotel and
airline services.
o Specialty products are consumer products and services with unique characteristics or
brand identification for which a significant group of buyers is willing to make a special
purchase effort.
o Examples include specific brands of cars, high-priced photographic equipment,
designer clothes, and the services of medical or legal specialists.
o Unsought products are consumer products that the consumer either does not know about
or knows about but does not normally think of buying. Most major new innovations are
unsought until the consumer becomes aware of them through advertising.
o examples of known but unsought products and services are life insurance,
preplanned funeral services, and blood donations
o Marketing unsought products requires a different approach from typical product
marketing
▪ i.e., marketing funeral services and cemetery
o Industrial Products are those purchased for purther processing or for use in conducting
a business.
o Distinction between a consumer product and an industial product is based on the
purpose for which the product is bought
▪ i.e., lawn mower: if it is purchased to use for the home, it is a consumer
product; if it is for a landscaping business, the lawn mower us an industrial
product
o Three groups of industrial products and services:
▪ Material and Parts
• Raw materials and manufactured materials and parts
o Raw Material: farm products (wheat, cotton, livestock,
fruit, vegetable)
o Natural Products 9fish, lumber, crude petroleum, iron ore)
o Manufactured Materials and Parts: component material
(iron, cement, yarn, wires) and component parts (small
motors, tires, casting)
▪ Capital Items
• industrial products that aid in the buyer’s production or operations,
including installations and accessory equipment.
o Installations consist of major purchases such as buildings
(factories, offices) and fixed equipment (generators, drill
presses, large computer systems, elevators).
o Accessory equipment includes portable factory equipment
and tools (hand tools, lift trucks) and office equipment
(computers, scanners, desks).
▪ Supplies and Services
• Supplies: operating supplies (lubricant, coal, paper, pencils)
o Supplies are the convenience products of the industrial field
bc they are usually purchased with a minimum of effort or
comparison
• Repair and Maintenance Items (paint, nails, brooms)
• Business Service: Maintenance and repair services (window
cleaning, computer repair)
• Business advisory services: (legal, management consulting,
advertising).
• Such services are usually supplied under contract.
