PRODUCT DECISION

Definition of Product:
 “Anything that can be offered to a market for attention, acquisition,
use or consumption that might satisfy a want or need. It includes
physical objects, services, persons, places, organizations and ideas”.
 Kotler, Wong, Saunders, Armstrong
 An iPhone mobile device, a Volvo Truck, a Bank Account and consultation
with a Doctor are all products.

 According to the marketing mix product definition, a product is anything

that is offered in a market to satisfy human wants and needs.

 Product marketing mix is not the name of tangible goods.

 Broadly, it includes physical objects, persons, place, organizations and

even ideas or combination for these characteristics.
 Introduction

 A product is anything that is offered to a market to satisfy customer

wants and needs. The product includes both tangible and intangible
items available for sale in the market.

 Product is the most important component of marketing mix.

 If the product fails to satisfy the needs and wants of the consumers, no
any additional expenditure and effort on any other component of the
marketing mix will improve the product performance in the market.
 A company sells a variety of products at a time.
 A product line is a collection of related products or services offered by a company
under a single brand or category.
 These products share common characteristics, such as brand identity, function,
quality, and distribution channels.
 Product lines allow companies to efficiently manage a range of offerings, cater to
diverse customer needs, and maximize brand recognition and loyalty.
Tangible goods Vs Intangible products
 Tangible and intangible products are two broad classes of products or
goods that business owners sell to their customers.

 Tangible Products:
 Tangible products are physical goods that can be touched, seen, and felt.
 They have a physical presence and are typically manufactured, stored, and
transported.
 Examples of tangible products include clothing, electronics, furniture,
automobiles, and household appliances.
 Tangible products can be evaluated based on their physical attributes such
as size, color, shape, and material.
 Intangible Products:
 Intangible products are services or goods that do not have a physical form
and cannot be touched.
 They are experiential, knowledge-based, or immaterial in nature.
 Examples of intangible products include financial services, consulting
services, software, insurance, education, entertainment, and healthcare
services.
 Intangible products are often characterized by the benefits or experiences
they provide rather than physical attributes.
Characteristics of a Product
 Utility: A product must serve a purpose or fulfill a need of the customer.
 Features: A product may have unique features that differentiate it from other
similar products.
 Quality: A product must meet or exceed the expectations of the customer in
terms of quality.
 Brand: A product may have a brand name that helps customers recognize and
identify it.
 Packaging: A product may be packaged in a way that attracts customers and
protects the product during transport.
 Price: A product must be priced in a way that is attractive to the customer and
competitive in the market.
 Availability: A product must be available when and where the customer wants it.
 Design: Any product may have a design that enhances its functionality or appeal
to the customer.
 Warranty: A product may come with a warranty that provides the customer with
assurance and protection.
Level of the product
 1. Core Benefit
 The core benefit is the fundamental need or wants that the customer
satisfies when they buy the product.
 For example, the core benefit of a hotel is to provide somewhere to
rest or sleep when away from home.

 2. Generic Product
 The generic product is a basic version of the product made up of only
those features necessary for it to function.
 In our hotel example, this could mean a bed, towels, a bathroom, a
mirror, and a wardrobe.
3. Expected Product
 The expected product is the set of features that the customers expect
when they buy the product.
 In our hotel example, this would include clean sheets, some clean
towels, Wi-fi, and a clean bathroom.

4. Augmented Product
 The augmented product refers to any product variations, extra features,
or services that help differentiate the product from its competitors.e.g
free home delivery service,free installations, credit facility
 In our hotel example, this could be the inclusion of a concierge service or
a free map of the town in every room.
5. Potential Product
 The potential product includes all augmentations and transformations
the product might undergo in the future. In simple language, this means
that to continue to surprise and delight customers the product must be
augmented.
 And it is really considering how the product can be modified into the
future, primarily to generate future sales from existing customers. We
can do this through product improvements and enhancements over time,
which will provide some form of additional benefits to the consumer.
 In many cases, the potential product will form part of the firm’s customer
relationship management programs.
 In our hotel, this could mean a different gift placed in the room each time
a customer stays. For example, it could be some chocolates on one
occasion, and some luxury water on another. By continuing to augment
its product in this way the hotel will continue to delight and surprise the
customer.
Five Product Levels Example: Coca-Cola
It can be easy to see how the Five Product Levels apply to the hotel industry, but
what about a company like Coca-Cola?
Let’s examine what each level might be for this company:

1. Core Benefit
 The core benefit of Coca-Cola is to quench a thirst.

2. Generic Product
 The generic product is a burnt vanilla smelling, black, carbonated, and
sweetened fizzy drink.

3. Expected Product
 The expected product is that the customer’s Coca-Cola is cold. If this isn’t the
case then expectations won’t be met and the drink will not taste its best in the
mind of the customer.
4. Augmented Product
 Coca-Cola’s augmented product is that it offers Diet-Coke. How does Coca-
Cola exceed customers expectations with this product? By offering all the
great taste of Coca-Cola, but with zero calories.

5. Potential Product
 One way in which Coca-Cola delights customers is by running competitions.
The prizes in these competitions are often things that, “money can’t buy”,
such as celebrity experiences. To continue to delight customers over time
the competition prizes change frequently.
 Product Classification
and
Marketing Considerations
 You know that feeling when you’re stuck waiting in line at the checkout
counter and your eyes wander over to the candy bars on display?
 They’re just begging to be grabbed, with their convenient location and
affordable price tag.
 It’s no wonder so many people end up impulsively buying them!
 Thanks to clever product classification, companies know exactly how to
catch our attention and make us want to buy their products.
 But product classification isn’t just about understanding your
customers – it’s also an essential tool for shaping your overall
marketing strategy to target the right audience.
 Impulsive buying is the tendency of a customer to buy goods and
services without planning in advance.

 When a customer takes such buying decisions at the spur of the

moment, it is usually triggered by emotions and feelings.

 It is making an unplanned purchase. It is based on an irrational

thinking. Marketers try to tap this behavior of customers to boost sales.
 Buying candy, gum, or energy drinks in the checkout line
 Buying clothing, shoes, or video games that are not needed
 Buying candles, home improvement items, or toys that are not on the
shopping list
 Product classification is the way products are organized into different
categories based on consumer buying behavior, price range, and
competition.

 On the basis of the type of the buyer and the product use, product are
classified into two major categories:
1. Consumer products : Bought by individuals for personal consumption
2. Industrial products: Purchased by businesses for further processing or for
use in their operations
1. Consumer Products
 1. Convenience Goods
 Convenience goods are products that consumers buy repeatedly without much
thought.
 i.e frequently purchased and with minimal effort, often due to their immediate
need or habitual consumption patterns.
 Once consumers choose their brand of choice, they typically stick to it unless
they see a reason to switch. For example, an interesting advertisement or
convenient placement at the checkout aisle may inspire them to try a new brand.
 Examples of convenience goods include:
 Gum
 Toilet paper
 Soap
 Toothpaste
 Shampoo
 Milk
 Convenience products can be classified into several categories based on their
characteristics and consumer behavior. Here are common classifications of
convenience products:

A. Staple Convenience Products:

 These are everyday, low priced items that consumers purchase regularly and
consider essential for their daily needs. Buyers spend little time and effort to
purchase these products. Examples include bread, milk, eggs, toiletries, and
household cleaning products.
B. Impulse Convenience Products:
 Impulse convenience products are items that consumers buy on a whim or impulse,
often without prior planning or intention. These purchases are driven by immediate
desires or emotions rather than specific needs. Examples include snacks, candies,
magazines, and small gadgets.
C. Emergency Convenience Products:
 Emergency convenience products are items that consumers purchase in urgent
situations or emergencies when they are unable to access their regular sources of
supply. Examples include umbrella, raincoat during rainstorm, first aid kits,
batteries, flashlights, and basic medical supplies.
Features of Convenience Products
 Frequent Purchases: Convenience products are items that consumers buy
regularly or frequently, often as part of their routine shopping trips or daily
activities.

 Low Cost: These products are typically inexpensive, making them affordable
for consumers to purchase without much consideration or hesitation.

 Widespread Availability: Convenience products are widely available

through various retail outlets, including convenience stores, supermarkets,
online retailers, and vending machines. They are easily accessible to
consumers whenever and wherever they need them.

 Minimal Shopping Effort: Consumers require minimal effort or time to

purchase convenience products. They are often placed in high-traffic areas
within stores, making them easily visible and accessible for quick retrieval.
 Immediate Consumption: Convenience products are designed for
immediate consumption or use. They fulfill consumers' immediate
needs or desires, providing instant gratification.

 Simple Decision-making: Purchasing convenience products involves

simple and straightforward decision-making processes. Consumers do
not need to invest significant time or cognitive effort in evaluating
alternatives or comparing brands.

 Impulse Purchase Potential: Due to their low cost and immediate

availability, convenience products have a high potential for impulse
purchases. Consumers may buy them on impulse, prompted by factors
such as eye-catching displays, promotional offers, or sudden cravings.
Marketing considerations for
Convenience products
 When marketing convenience products, it's essential to focus on strategies
that highlight ease of purchase, accessibility, and immediate satisfaction.
Here are some key marketing considerations for convenience products:
 Placement and Distribution:
 Ensure that convenience products are prominently displayed and easily accessible
in high-traffic areas of retail stores, convenience stores, or online platforms.
 Utilize strategic placement near checkout counters, entrances, or impulse-buy
sections to encourage spontaneous purchases.
 Packaging Design:
 Design packaging that emphasizes convenience, portability, and ease of use.
 Use clear and concise labeling to communicate product benefits, usage instructions,
and key features quickly to consumers.
 Promotional Strategies:
 Implement promotions and special offers to incentivize impulse
purchases, such as "buy one, get one free" deals, discounts, or limited-
time offers.
 Leverage point-of-sale displays, shelf-talkers, or end-cap displays to
attract attention and drive sales.
 Brand Awareness and Recognition:
 Build strong brand awareness and recognition through consistent branding
elements, logos, and packaging design.
 Establish brand loyalty by delivering reliable quality and consistently meeting
consumer expectations for convenience and reliability.

 Cross-Promotions and Bundling:

 Partner with complementary brands or products to offer bundled deals or cross-
promotions that enhance the convenience and value proposition for consumers.
 Collaborate with retailers or online platforms to feature convenience products
as part of curated collections or themed promotions.
2. Shopping Products
 Shopping products are items that consumers typically buy less frequently and
invest more time and effort in comparing and evaluating before making a
purchase decision.

 These products are generally more expensive than convenience products and
require more consideration due to their higher involvement.

 Shopping goods can be affordable items, like clothes and home decor. For
example, if you have an event coming up and you want to get a nice pair of
shoes, this doesn’t fall under impulse purchases. Instead, you'll want to try it on,
consider whether the price is worth it, and even get input from your loved ones.

 Shopping goods can also be a one-off purchase with a higher economic impact.
These are higher-end goods like cars and houses.

 Since it's an expensive and important purchase, you'll spend a good amount of
time deliberating on it.
Features of Shopping products:
 Higher Involvement: Consumers invest more time, effort, and thought
into the purchase decision for shopping products compared to convenience
products.
 Comparative Shopping: Consumers engage in comparing different
brands, features, prices, and quality before making a purchase.
 Considerable Price Variability: Shopping products often have a wide
range of prices, and consumers may be willing to pay more for better
quality or features.
 Less Frequent Purchases: Shopping products are bought less frequently
than convenience products and may involve longer purchase cycles.
 Brand Loyalty vs. Exploration: While some consumers may exhibit
brand loyalty, others are open to exploring different brands and options to
find the best fit.
 Wider Distribution Channels: Shopping products are typically available
through various distribution channels including department stores,
specialty stores, and online retailers.
Marketing Considerations of Shopping Products:

 Product Differentiation: Highlight unique features, benefits, and qualities

of the product to distinguish it from competitors.

 Brand Image and Reputation: Build a strong brand image and reputation
through consistent quality, reliability, and customer satisfaction.

 Targeted Advertising: Use targeted advertising campaigns to reach

specific market segments based on demographics, interests, and purchasing
behaviors.

 Promotional Activities: Offer promotions, discounts, or special deals to

incentivize purchase and encourage consumers to choose your product over
competitors'.
 Point-of-Purchase Displays: Utilize eye-catching displays and signage
in retail environments to attract attention and influence purchase
decisions.

 Product Demonstrations: Conduct product demonstrations or trials to

allow consumers to experience the product firsthand and understand its
benefits.

 Online Reviews and Recommendations: Encourage positive online

reviews and recommendations from satisfied customers to build credibility
and trust.
3. Specialty products
 Specialty products are unique or distinctive items for which consumers are
willing to exert extra effort to seek out and purchase.
 These products typically have unique characteristics, high quality, or
exclusive features that differentiate them from other alternatives in the
market.
 A specialty good is the only product of its kind on the market. This means
consumers don't usually feel the need to compare and deliberate as much
as they would with shopping products.
 For example, iPhones are a specialty good because of Apple’s strong brand
identity, unique features, and operating system. This combination creates
a perception of product quality.
 Other examples of specialty goods include luxury cars, bags, watches,
designer clothing.
Feature of Specialty Products:
 Unique or Exclusive Features: Specialty products possess unique
attributes, qualities, or characteristics that set them apart from other
products in the market.
 High Perceived Value: Consumers perceive specialty products as
having high value or significance, often justifying premium pricing.
 Limited Availability: Specialty products are often available in limited
quantities or through exclusive distribution channels, contributing to their
perceived scarcity.
 Brand Loyalty: Consumers may exhibit strong brand loyalty towards
specialty products, preferring specific brands or manufacturers known for
quality and reliability.
 Targeted Market Segments: Specialty products typically target niche
or specialized market segments with specific needs, preferences, or
interests.
 Emotional Appeal: Specialty products may evoke emotional connections
or resonate with consumers on a personal or emotional level, driving
purchase decisions.
Marketing Considerations of Specialty Products:

 Brand Positioning: Position the product as a premium or exclusive offering,

emphasizing unique features, craftsmanship, and quality.

 Selective Distribution: Distribute specialty products through selective channels

such as specialty stores, boutiques, or online platforms catering to niche markets.

 Price Strategy: Implement premium pricing strategies to reflect the perceived value
and exclusivity of the product.

 Promotional Activities: Utilize targeted marketing campaigns, events, and

promotions to create awareness and generate interest among the target market.

 Customer Experience: Focus on delivering exceptional customer experiences

through personalized service, attention to detail, and after-sales support.

 Limited Editions and Exclusivity: Offer limited editions or exclusive versions of the
product to create a sense of exclusivity and urgency among consumers.
4. Unsought products
 Unsought products are goods that people aren't usually excited to buy.
These products have utility, but they're usually not fun purchases.

 Items that consumers either do not actively seek out or are unaware of
until they have a specific need or problem arise.

 These products typically require aggressive marketing efforts to generate

consumer interest and demand.

 Good examples of unsought goods include fire extinguishers, insurance.

 People often buy unsought goods out of a sense of fear, danger, or utility.
For instance, you wouldn't go online to search for the "new and best" fire
extinguisher. You'd only buy one due to the fear of a potential fire.
Feature of Unsought Specialty
Products:
Low Consumer Awareness: Consumers may not be aware of the
existence of unsought products until they encounter a specific need or
problem that requires a solution.
 Complex or Unfamiliar: Unsought products may be perceived as complex,
unfamiliar, or difficult to understand by consumers, requiring education and
explanation.
 High Involvement Purchase: Purchasing unsought products often
involves high levels of risk or uncertainty for consumers due to their
unfamiliarity or perceived complexity.
 Emergency or Urgent Need: Consumers may only seek out unsought
products when faced with emergencies, crises, or unexpected situations that
require immediate attention or resolution.
 Long Purchase Cycles: The purchase cycle for unsought products tends to
be longer and less predictable compared to other types of products, as
consumers may take time to research, evaluate, and consider alternatives.
 Limited or No Brand Loyalty: Consumers may have limited brand loyalty
or preference for unsought products, as they are more focused on finding
the best solution to their problem rather than specific brands.
Marketing Considerations of Unsought Products:

 Create Awareness: Invest in marketing efforts to raise awareness of the

problem or need that the unsought product addresses, as well as the benefits
and solutions offered by the product.
 Educational Marketing: Provide comprehensive information and education
about the product, its features, benefits, and usage to help consumers
understand its value and relevance.
 Demonstrations and Trials: Offer product demonstrations, trials, or
samples to allow consumers to experience the product firsthand and
overcome any skepticism or hesitation.
 Highlight Solutions: Emphasize how the unsought product solves specific
problems or addresses unmet needs for consumers, focusing on the value
proposition and practical benefits.
 Targeted Advertising: Utilize targeted advertising and messaging to reach
consumers who may be experiencing the problem or need that the unsought
product addresses, highlighting its relevance and importance.
 Incentives and Guarantees: Offer incentives, guarantees, or risk-reversal
strategies to reduce consumer apprehension and encourage trial and
adoption of the unsought product.
Summarize …
 INDUSTRIAL PRODUCTS
 Industrial products can not be directly used by consumers, these products need
to be processed to be able to use by end consumers.
 Usually, industrial products are those which are purchased for industries or
business use
 An industrial product is a type of product purchased by a business firm for
consumption, rendering services, or reselling purposes.
 Industrial products are also called business products.
 Industrial Products
 Products like glue having high adhesive strength are not required by
people in day to day to life but are key requirement for various industries
like automobile, leather etc.

 Similarly products like heavy machinery and robotics might be used by

car manufacturers but not by end users or customers.
 The following are the main characteristics of industrial goods.
1.Bulk Purchase
 As compared to consumer goods, industrial goods are purchased in
huge quantities.
2.Purpose
 Industrial goods are mostly purchased for either reproduction or resell
purposes.
3.Few Buyers
 Industrial buyers are few but large in size. The industrial market has
few buyers who buy their requirement of products or services in large
quantities.
 Classification of Industrial Products

Entering Foundation
Products: Products: Facilitating
1. Raw Materials 1. Installations
2. Fabricating Parts 2. Accessory
Products
and Materials Equipment
Entering Products:

1. Raw Materials:
 These are the basic materials that are harvested or extracted from
nature and are used in manufacturing processes without undergoing
significant changes.
 These are the unprocessed primary materials.
 The natural raw materials are gifted by nature and its supply is
limited.
 Examples include raw metals like iron ore, agricultural products like
cotton, and minerals like coal.
Features of Raw Materials:
 Raw materials are perishable in nature.
 Bought frequently by industrial buyers.
 Basic component of all kind of finished products.
 The unit price of raw materials is very low.
 Normally, raw materials are purchased in large quantity.
 The cost of raw materials has a direct impact on production cost.
Marketing Considerations for Raw
Materials:
Quality Assurance: The quality of raw materials significantly impacts the final
product's quality. Marketing efforts should focus on highlighting:
 the superior quality of the raw materials,
 emphasizing any certifications,
 testing procedures, or
 quality control measures in place.

 Sourcing and Traceability: Consumers are increasingly interested in knowing

where their products come from and how they were produced. Marketing raw
materials with a focus on ethical sourcing, sustainability, and traceability can
help build trust with customers and differentiate the product in the market.

 Supply Chain Reliability: Reliability of the supply chain is crucial to ensure a

steady flow of raw materials to meet production demands. Marketing efforts
should communicate the company's commitment to reliable supply chain
management, including backup suppliers or contingency plans to mitigate
disruptions.
 Product Differentiation: In competitive markets, differentiation is key to
standing out. Marketing raw materials based on unique properties,
proprietary processes, or exclusive partnerships can create a competitive
advantage and justify premium pricing.

 Market Trends and Consumer Preferences: Keeping abreast of market

trends and consumer preferences is vital for effective marketing. Whether
it's a growing demand for organic products, sustainable sourcing, or the
use of innovative materials, aligning marketing messages with these
trends can capture consumer interest and drive sales.

 Promotional activities is not required. Branding is not essential

fro these products.
2.Fabricated parts and Materials :

Fabricating parts are those industrial products which are assembles

without further changes in any form. They are only fabricated in the final
products. E.g. Tyres button zippers, batteries.
Materials are products that undergo some level of processing or
manufacturing before being used in further production. They are not in their
raw form but have been shaped or processed to some extent. E.g. Processing
cotton into threads, processing wheat into flour, etc.
 Examples include:
 Steel: Used in automotive manufacturing for chassis, body panels, and
structural components.
 Plastic Resins: Essential for producing various plastic products such as
bottles, containers, and packaging materials.
 Chemicals: Basic chemicals like acids, bases, and solvents used in
pharmaceutical, chemical, and manufacturing industries.
 Parts are assembled with no further change in form.
Features of Fabricated Materials and parts :
 Quality and price of fabricating materials have direct impact on
finished products. So, uniformity in size and standard of quality
should be maintained.
 Generally purchased in huge quantity.
 Semi finished in nature.
 It is one part of final products.
 Relatively low price per unit.
Marketing Considerations of Fabricated
Parts and Materials :
 Organization must purchase by the contract.
 Direct distribution channel must be used.
 After sales services are provided. Offer comprehensive after-sales
support, including installation assistance, maintenance services, and
technical support.
 Packaging need not to be considered.
 Transportation and warehousing is important.
Foundation Products:
 Foundation products are the manufacturing machines, equipments,
capital items that make production possible.
 They are used to perform the production process rather than becoming
part of the product.
 While they may not be directly visible in the end product, they provide
critical support or enable the production process.
 Foundation products often serve as building blocks for the final product
and contribute to its overall integrity and performance.
A. Installations :
Large installations are expensive, durable, and significant equipment of
an industrial user.
They are high priced capital products that have longer life span.
They show the work efficiency of the organization and directly affect scale
of operations.
E.g printing machines for press, large generators in dam, bottling
equipments etc
 Features of Installations:
 Highly durable and costly.
 Expert and rational buying.
 It shows work efficiency of the organization.
 It is a major equipment of the organization.
 Installation is purchase less frequently.
 Brand plays a major role in purchasing of installations.
 It is technical in nature.
 It doesn’t become major part of final goods but it is used to make
final goods.
Marketing Considerations of
Installations:
 Weight and price of these products are high. So, it is directly sold to
the industrial users. And, negotiation is very high.
 After sales service must be provided.
 Personal selling is key aspect for installations.
 Marketing companies should appoint distribution technician, engineer
and experienced salesman.
 Marketers must focus on after sales services.
B) Accessory Equipments –
Accessory Equipments are the induatrial products that assist the production process
without being part of actual manufacturing process.
 Equipments in case of factories will be caterpillars, trucks, cranes, forklifts,
storage racks.
 Equipment in case of industrial services will be computers, hardware and design
equipment, printers, copiers etc.
 All these are equipments which are assets.
Features of Equipment:
 These equipments are sold mainly through intermediaries.
 In the sale of equipments, personal selling plays a major role as compared
to marketing and advertising.
 Helps to make production easy and regular.
 Purchase more frequently and price rate is moderate than installation.
 As compared to installation, the life cycle of accessory equipment is
shorter.
 Purchased in less quantity and considered as fixed assets.
Marketing Considerations of Equipment:
 The distribution policy of accessory equipment is hard to generalize , as
manufacturers directly sell to the industrial users (if the sales quantity is
high ) whereas for the small quantities they use middleman.
 Price is not a prime factor in accessory equipment.
 Many promotional activities are essential to increase sales of these items.
 Like in installations, buyers give more importance to the brand of
accessory.
 Branding is important for accessory equipment.
Facilitating Products:
 Facilitating products are ancillary goods or services or the operating
supplies that support the production process but are not directly
incorporated into the final product.
 They enhance efficiency, productivity, or safety within the
manufacturing environment.
 Categorized as convenience products of industrial user.
 Often referred as MRO items ( Maintenance repair and operations items).
 Facilitating products may include tools, equipment, software, and services
that aid in production, maintenance, or logistics.
 Examples include lubricants, cutting tools, safety equipment,
maintenance supplies, software for process optimization, and training
services for employees.
 Any short term goods or material which is necessary for the day to day
operations or a company or businesses is termed as supplies. A simple
exam is A4 sized paper.
 Facilitating Products:
 Maintenance Supplies: Products used to maintain and upkeep machinery,
equipment, and facilities, ensuring smooth operations. Examples include:
 Lubricants and Greases: Essential for reducing friction and wear in machinery
components, extending their lifespan.
 Cleaning Agents: Used for equipment and facility maintenance to ensure
cleanliness and hygiene standards.
 Operating supplies – Pen and paper, notepads, are part of the operating
supplies needed on a day to day basis. Kangaro is an excellent brand
which comes to mind when it comes to staplers and staple pins.
Features:
 Performance Enhancement: Delivering superior performance
characteristics, such as high-speed operation, precision control, or energy
efficiency.
 Frequent Purchase: Can be purchased quickly and doesn’t require much
time and effort.
 Easily Available: Available everywhere and can be purchased easily.
 Middleman: Generally purchased through mediators.
 Marketing Considerations:
 Marketing facilitating products involves highlighting their ability to
streamline operations, reduce costs, and enhance workplace safety. Key
considerations include:
 Middlemen are used , so wider / longer distribution channel is required.
 These products must have competitive price i.e low profit margins.
 After sales services are not that important in these products.
 Advertisement may be major means of promoting these products.
Product life cycle:
 The product life cycle is a powerful administrative tool to understand the
different phases that a product goes through. It maps a product’s
journey from its launch until its discontinuation.
 A period during which a product lives in the market is termed as product
life cycle.
 Product life cycle is a four-stage process. It will then consist of the
following four stages:
1. Development and introduction stage
2. Growth stage
3. Maturity stage
4. Decline stage
Stages of Product life cycle
Importance of the Product Life
Cycle
 The product life cycle is important because it informs an organization’s
management and decision-makers how well a product is performing and
what strategic actions it will take to succeed. This helps companies
allocate resources like staff, budgets, shows which products should be
prioritized, and where the company should innovate next.
 Other benefits of using the product life cycle include:
 Make better marketing investments and decisions
 Easier to make long-term plans
 Allows for better decision making with accurate information on
performance
 Easier to streamline current processes within your company
Development and Introduction
Stage
The development stage is where the product life cycle starts.
 High costs are involved in this stage as there is very little or no revenue
and a lot more costs related to the development and introduction of the
product.
 The product may struggle with brand recognition. As a result, we
need very specific marketing and advertising strategies.
 This is especially true if the product is innovative or has new features
that are not currently available in the market. Reaching out to influential
personalities in your product’s ecosystem is one way to boost product
awareness.
 In addition to the above costs, you may find it difficult to find a supplier
who is willing to stock your product during this stage.
 You may also need to extend a credit line to the willing suppliers/retailers
which is an additional cost as no revenue is generated until a sale takes
place.
 Characteristics:
 Low sales volume as the product is new and unfamiliar to consumers.
 High costs due to heavy investment in research, development, and
marketing efforts.
 Limited competition as the product is pioneering a new market or
category.

 Marketing Strategies:
 Create Awareness: Focus on creating awareness among consumers
about the existence and benefits of the product.
 Promotional Activities: Invest in advertising, public relations, and
promotions to generate interest and stimulate trial. Use introductory
offers, discounts, or trials to encourage early adoption.
 Selective Distribution: Initially, concentrate distribution efforts in key
target markets to manage costs and ensure availability.
 Niche Targeting: Identify and target early adopters who are likely to be
interested in innovative products.
Some great sales strategies to succeed in the market introduction stage are:
 Free trials/samples
 Money back guarantee
 Discounts for early buyers

For the marketing strategy during the introduction phase, the management
may choose from one of the following options:
 Rapid skimming (high price, high-level promotion)
 Slow skimming (high price, low-level promotion)
 Rapid penetration (low price, high-level promotion)
 Slow penetration (low price, low-level promotion)
 The choice depends upon factors such as the type of product, industry and
existing competition.
 Rapid Skimming (High price, High-level promotion)

This strategy involves setting a high price initially to "skim" the maximum
amount of revenue from early adopters who are willing to pay a premium.
It is combined with high-level promotion to generate awareness and
excitement quickly.
Main Objectives it to quickly recoup development costs and maximize
profits from consumers who are less price-sensitive and eager to try the
new product.
It is suitable for: Innovative or high-end products with unique features,
where early adopters are willing to pay a premium. This is often used for
technology products or luxury items.
 Example: The launch of the latest high-end smartphone model with
premium pricing and extensive marketing campaigns.
 Slow Skimming (High price, Low-level promotion)

This strategy involves setting a high initial price but with a slower and more
gradual approach to market penetration. Promotion levels are moderate,
focusing on building brand prestige and perceived value over time.
The main objectives are to target early adopters who are willing to pay a
high price while allowing time to build brand recognition and market
position before broadening the reach.
It is suitable for the products that benefit from a strong brand image and
can afford to build market presence over time, such as premium gadgets or
exclusive fashion items.
 Example: A high-end luxury car brand launching a new model with a
gradual increase in marketing efforts as the product gains traction.
 Rapid Penetration (Low price, High-level promotion)

This strategy involves setting a low price initially to quickly gain market
share and attract a large customer base. Promotion is typically extensive
and aggressive to drive widespread adoption.
The main objectives are to achieve a high market penetration quickly,
create strong brand awareness, and establish a large customer base before
competitors enter the market.
It is suitable for the products in competitive markets or those that benefit
from large-scale adoption, such as consumer electronics or household
goods.
 Example: A new streaming service offering a low introductory price to
attract a large subscriber base rapidly.
 Slow Penetration (Low Price, Low-Level Promotion)
This strategy involves setting a low initial price and using minimal promotion.
It aims to attract price-sensitive customers and gradually build market
presence without significant marketing expenditures.
The main objectives are to enter the market with minimal financial risk,
appeal to price-conscious consumers, and gradually increase market share
over time.
It is suitable for the products with lower development costs or those
entering a market with strong existing competition, where a low-price
strategy can help gain traction without heavy promotion.
 Example: A new budget-friendly household appliance entering a
saturated market with modest advertising and low pricing to attract cost-
conscious buyers.
 Examples of products in the development and introduction
stage
 The launch of the Tesla Model 3 electric car. Tesla heavily marketed the
Model 3 through events, social media, and targeted advertising to create
buzz and generate pre-orders before mass production.
 Artificial intelligence applications
 Foldable and rollable smartphones and TVs
 Growth Stage
 We enter this stage after successfully introducing the product to the target market.
 If the product is appealing, mass-scale adoption begins. The adoption may be slow at the
start but as compounding takes over, the sales volume starts increasing fast during the
growth phase.
 More and more people sign up for the product/service as early buyers and promotional offers
start bringing in more traffic. More suppliers are willing to stock the product and ready to pay
cash as the demand increases.
 The management may take the step to approach bigger supermarkets besides small retailers.
It may also strive to enter new markets and transition from a niche to a more diverse group
of buyers.
 The goal is to have as much market penetration as possible to reach full sales potential.
Collecting customer feedback and implementing it is crucial to further improve the product
and meet this goal.
 The growth stage is also the stage where competitors will usually enter the market. This
is because, many times, companies wait for a market to be established to bypass some of the
costs associated with the introduction phase.
 But once your product creates that market, competitors will almost always come up with
products that are either a direct copy or very similar to your offering with some added
features.
 Characteristics:
 Rapid increase in sales as consumer acceptance grows.
 Competition intensifies as new players enter the market attracted by
growth opportunities.
 Economies of scale lead to lower production costs per unit.

 Marketing Strategies:
 Market Expansion: Broaden the target audience and geographic reach.
 Differentiation: Highlight unique features and benefits to stand out
from competitors.
 Brand Building: Invest in building a strong brand identity and customer
loyalty.
 Examples of products in the growth stage
 Some of the most relatable examples of products in the growth stage
are as follows:
 Smartphones (2010s): As smartphones became popular, companies
like Apple and Samsung invested in expanding their product lines,
enhancing features, and strengthening brand loyalty.
 Electric vehicles
 Online education
 Smart watches
 Bluetooth wireless earphones
 Maturity stage
 The maturity stage of the product life cycle is the most profitable
stage, the time when the costs of producing and marketing decline.
 At this point, companies begin to reduce their prices so they can stay
competitive amongst the growing competition.
 Streamlining production processes, negotiating favorable supplier
contracts, and optimizing distribution networks also become important
considerations.
 This is the phase where a company begins to become more efficient and
learns from the mistakes made in the introduction and growth stages.
 Marketing campaigns are typically focused on differentiation rather than
awareness. This means that product features might be enhanced, prices
might be lowered, and distribution becomes more intensive.
 Characteristics:
 Sales growth slows down as the market becomes saturated.
 Competition intensifies, leading to price wars and margin pressure.
 Product differentiation becomes critical to maintaining market share.

 Marketing Strategies:
 Differentiation: Emphasize product differentiation through branding, features, or
customer service to maintain a competitive edge.
 Cost Leadership: Focus on cost reduction to maintain profitability amidst price
competition.
 Diversification: Explore new market segments or product innovations to offset
declining sales in the mature market.
 Promotions: Use promotional strategies like discounts, loyalty programs, and
bundling to drive sales.

 Example: Coca-Cola in the mature stage continuously differentiates its

products through marketing campaigns, packaging variations, and flavor
innovations to maintain market share amidst intense competition in the soft
drink industry.
Decline
 Unfortunately, if your product doesn‘t become the preferred brand in a
marketplace, you’ll typically experience a decline.
 Sales will decrease during the heightened competition, which is hard to
overcome.
 Decline also occurs when products become outdated or less relevant
as newer technologies enter the market. Consumers may turn to more
advanced options, rendering the declining product less desirable.
 If a company is at this stage, it'll either discontinue its product, sell the
company, or innovate and iterate on its product in some way.
 Characteristics:
 Sales and profits decline due to market saturation, technological
advancements, or changing consumer preferences.
 Declining profitability may lead to the withdrawal of weaker competitors from
the market.
 Marketing Strategies:
 Harvesting: Reduce marketing expenditures and focus on maximizing short-
term profits from loyal customers or niche markets.
 Repositioning: Reposition the product to target a new customer segment or
address emerging needs to extend its life cycle. Consider extending the
product line with updated versions or variations to reinvigorate interest.
 Exit Strategy: If the product becomes obsolete or unprofitable, consider
discontinuation or phasing out while transitioning to newer offerings.
 Examples of products in the Decline stage
 Some products that are already in the decline phase are as follows:
 The decline of film cameras due to the rise of digital photography. As
demand for film cameras dwindled, companies like Kodak gradually
phased out their film camera lines and focused on digital camera
technology and other imaging products.
 Diesel vehicles
 Personal computers
 Wired earphones/headphones
 Apple iPod and other dedicated MP3 players
 CDs, DVD and cassette tapes
 Landline telephones
Summarize..
New Product Development Process:

 The product development process encompasses all steps needed to

take a product from concept to market availability.
 Product development is the process of creating, designing, or refining
products that meet customer needs and expectations.
 Product development plays a vital role in a company’s success by
fostering innovation, maintaining a competitive edge, and ultimately
driving revenue growth.
STEPS:
 Idea Generation:
 This stage involves generating a pool of ideas for potential new products or
improvements to existing products.
 Ideas can come from various sources, listening complaints and suggestions,
formal surveys including market research, marketing intermediaries, customer
feedback, competitor analysis, brainstorming sessions, and internal R&D efforts.

 Idea Screening:
 Not all ideas are good ones. In this stage, the generated ideas are evaluated
based on predetermined criteria such as market potential, strategic fit, and in
terms of the organization’s objectives, policies, technical feasibility and financial
availability.
 Screening helps narrow down the list of ideas to focus resources on those
with the highest potential for success.
 Concept Development and Testing:
 Once promising ideas are identified, they are developed into product concepts that
outline the key features, benefits, and value proposition of the proposed product.
 Concepts are then tested with target customers through surveys, focus groups,
or prototype demonstrations to gauge their acceptance and refine them based
on feedback.

 Marketing Strategy Development:

 It is the preliminary marketing strategy for the successful product concepts. Such a
marketing strategy includes the following aspects:
 The target market for the product.
 Possible positioning for the product.
 Preliminary estimate of sales, market share and profits from the product during the
first few years.
 The products planned price, distribution and promotion program.
 Long-term sales, profit and marketing strategy for the product.
 Business Analysis:
 In this stage, a comprehensive assessment of the proposed product's financial viability
and market potential is conducted.
 Factors such as estimated sales volume, pricing strategy, production costs, and
profitability projections are analyzed to determine the product's feasibility and
potential return on investment. “Can we make and sell this product and
make money doing it?”

 Product Development:
 Once the concept is validated and approved, the actual product development process
begins.
 This stage involves designing the product, engineering prototypes, conducting testing
and validation, and refining the product to meet quality standardsZ and regulatory
requirements.

 Market Testing (Optional):

 Some companies choose to conduct market tests or pilot launches of the product in
select markets or segments to evaluate real-world performance and gather additional
feedback before full-scale commercialization.
 Possible positioning for the product, preliminary estimate of sales, market share and
profits from the product during the first few years is analyzed.
 Commercialization:
 The final stage involves launching the product into the market and executing
a comprehensive go-to-market strategy.
 Activities may include marketing and advertising campaigns, sales channel
development, distribution logistics, and customer support initiatives to
generate awareness, drive sales, and ensure a successful market entry.

 Post-Launch Evaluation and Feedback:

 After the product is launched, ongoing monitoring and evaluation are
essential to track performance metrics, gather customer feedback, and
identify opportunities for further improvement or iteration.
Understanding Brand
Philip Kotler
“A brand is a name, term, sign, symbol or design, or a combination
of them, intended to identify the goods or services of one seller’s
and to differentiate them from those of competitors’.”

A brand is an intangible asset made up of many elements. Together these

elements help consumers identify a product and give them reasons to buy it
rather than its competitors.

The brand may convey a message that the product is more effective, easier
to use, better tasting, cheaper, sophisticated, trendier, or more
environmentally sound than its competitors.
 Building a strong brand involves various elements,
a. brand identity (visual and verbal representation),
b. brand positioning (how the brand is perceived relative to competitors),
c. brand messaging (communication of the brand's values and benefits),
d. and brand experience (the overall customer interaction with the brand).
 A well-established brand can foster trust, loyalty, and recognition
among consumers, ultimately contributing to the success and longevity
of a business.
Key Elements of Branding:
 Brand Name: The name of the product or company (e.g., "Apple").
 Logo: A visual symbol or design representing the brand (e.g., Nike’s
swoosh).
 Tagline or Slogan: A memorable phrase that encapsulates the brand’s
essence (e.g., "Just Do It" for Nike).
 Brand Voice and Messaging: The tone and style of communication
used in marketing and customer interactions.
 Visual Identity: The color schemes, fonts, and design elements that
create a visual impression of the brand.
What is Branding???
 Branding is how a company actively shapes and influences the
perception of its brand in the minds of consumers.
 It is a strategy designed by companies to help people to quickly identify
their products and organization, and give them a reason to choose their
products over the competition’s, by clarifying what this particular brand is
and is not.
 It is the deliberate effort to build and cultivate a brand, while the brand
itself is the result of those efforts and the perceptions held by consumers.
 It is an ongoing process that requires consistent attention and adaptation
to changing market conditions and consumer preferences.
 The brand name is the verbal identifier of a brand,
 the brand mark is the visual representation,
 and a trademark is the legal protection for both the name and mark to
prevent unauthorized use by others.
 Together, they form essential components of a brand's identity and
help distinguish it in the marketplace.
 Brand names, brand marks, and trademarks work together to establish
and protect the identity and reputation of a brand in the marketplace.

Brand Brand
Name Mark Trade
Mark
 Brand Name: The brand name is the word or words used to identify a
company, product, or service. It's the primary verbal component of a
brand's identity and is often one of the most recognizable elements.
 A strong brand name is memorable, easy to pronounce, and distinct
from competitors.
 Amazon: The brand name "Amazon" was chosen by founder Jeff Bezos
because it evokes the vastness and diversity of the Amazon River,
reflecting his vision of creating an extensive online marketplace
offering a wide range of products.
 Brand Mark: A brand mark, also known as a logo or symbol, is the visual
representation of a brand.
 It's a graphic element that serves as a visual shorthand for the brand and
helps to reinforce its identity. A brand mark can include symbols, icons,
typography, or a combination of these elements. Examples include the Nike
swoosh, the Apple logo, or the McDonald's golden arches.
 A well-designed brand mark is simple, versatile, and instantly recognizable.
 Mercedes-Benz Star: The Mercedes-Benz three-pointed star logo represents
the company's dominance over land, sea, and air transportation. It's a symbol
of luxury, prestige, and engineering excellence associated with the Mercedes-
Benz brand.
 Trademark: A trademark is a legal protection granted to a brand name,
brand mark, slogan, or other distinguishing elements of a brand to
prevent others from using them without permission.
 Trademarks can be registered with government agencies, such as the
United States Patent and Trademark Office (USPTO), to obtain exclusive
rights to use the trademark in connection with specific goods or services.
 Registering a trademark provides legal recourse against unauthorized
use or infringement by competitors. It's essential for businesses to
protect their trademarks to maintain the integrity and value of their
brand assets.
 Coca-Cola Logo: The distinctive Coca-Cola script logo, along with its
unique typography, is a registered trademark that protects the brand
identity of Coca-Cola from unauthorized use by competitors.
Toblerone and its mountain are widely recognizable, but there is
something many people miss at first glance. Have you noticed the
bear inside the mountain? It represents the city of Bern, where
Toblerone originated.
Shipping company FedEx has always been hiding an arrow
between the letters ‘E’ and ‘X’. This shape is meant to represent
how fast FedEx ships to its clients.
The arrow on Amazon’s logo not only represents a smile, conveying
customer satisfaction; it also connects the ‘A’ to the ‘Z’, meaning
that they sell everything from A to Z!
At first glance, this logo shows the shape of the African continent.
But if you look closer, you will see the outline of a child and their
mother, whom the foundation is trying to help bring together.
Sony Vaio combines the ideas of analog and digital technology into one.
It utilizes the ‘V’ and ‘A’ to represent an analog wave and the ‘I’ and ‘O’
to represent binary from the digital world.
Tostitos portrays a clever and fun design on its logo. You will see the
two ‘T’s in the middle as two people dipping a tortilla chip inside a
bowl on top of the ‘I’.
Baskin Robbins is an ice-cream chain company that has utilized
colors very cleverly. On their logo, you can read out the number
‘31’ out of the ‘B’ and ‘R’, representing their 31 flavors.
The Pinterest logo is pretty straightforward. A ‘P’ inside a
red circle, right? However, the ‘P’ is actually meant to
represent a pin.
Gillette’s logo features a simple but striking design that
incorporates the company name in blue lettering with a sharp
razor cut on the dot of the ‘I’’s, symbolizing the high
precision of their blades.
Adidas’ logo is one of the most famous in the sports world. But
did you know that the three lines on top of the words are
meant to represent a mountain? It symbolizes the hardships
and obstacles athletes face and overcome.
Hyundai’s logo appears very fancy and stylized with a slanted
‘H’ as the protagonist. However, that ‘H’ is also meant to
represent two people giving a handshake: a salesperson and a
customer.
Hershey’s Kisses has a very distinctive shape for its small
chocolate bites. But have you seen that the space between
the ‘K’ and the ‘I’ in ‘kisses’ forms the shape of one of their
chocolates?
Features of a good brand name:
 Memorable: A good brand name is easy to remember. It sticks in the minds of consumers,
making it more likely that they'll recall it when they need the product or service your brand
offers.

 Distinctive: The brand name should stand out from competitors and be distinct enough to
avoid confusion with other brands in the market. It should have a unique identity that sets it
apart.

 Relevant: The name should be relevant to the product, service, or the values your brand
represents. It should convey something meaningful about what your brand offers or what it
stands for.

 Simple and Clear: Avoid overly complicated or confusing names. A good brand name is
simple and straightforward, making it easy for consumers to understand and pronounce.

 Flexible: A good brand name should be versatile enough to accommodate future growth and
expansion. It should not limit your brand's potential to diversify into new products or
markets.

 Visual Appeal: A good brand name should also look good when written or displayed visually.
Consider how it will appear on packaging, signage, websites, and other marketing materials.
Objectives of branding
 Creating Recognition and Awareness: One of the fundamental objectives
of branding is to make the brand recognizable and increase awareness
among the target audience. A strong brand identity, including a memorable
logo, colors, and messaging, helps consumers identify and differentiate the
brand from competitors.

 Building Trust and Credibility: Branding aims to build trust and credibility
with consumers. A well-established brand with a positive reputation is more
likely to be trusted by customers, leading to increased loyalty and repeat
business.

 Establishing Differentiation: Effective branding helps a company stand

out from competitors by highlighting its unique value proposition and
differentiation factors. This could be based on product quality, innovation,
customer service, or other factors that set the brand apart.
 Fostering Emotional Connections: Brands often aim to create
emotional connections with consumers by tapping into their values,
aspirations, and desires. Emotionally resonant branding can lead to
stronger customer loyalty and advocacy.

 Supporting Marketing and Sales Efforts: Branding supports

marketing and sales efforts by providing a cohesive framework for
communication and promotion. Consistent branding across various
channels helps reinforce key messages and creates a unified brand
experience for customers.

 Driving Customer Loyalty and Advocacy: A strong brand can

cultivate customer loyalty, encouraging repeat purchases and positive
word-of-mouth recommendations. Loyal customers are more likely to
become brand advocates, helping to attract new customers and grow the
business.
 Facilitating Expansion and Growth: Effective branding can support
business growth by providing a platform for expansion into new
markets, product lines, or customer segments. A well-established brand
with a strong reputation is more likely to succeed in new ventures.

 Overall, the objectives of branding are

 To create a distinct and memorable identity for the brand,
 Build trust and loyalty with customers,
 Differentiate the brand from competitors,
 Support business growth and success
Types of Brands

On the basis of Ownership

Manufacturer Brands

Distributor Brands

Licensed Brands
Types of Brands:
 On the basis of ownership of products, brands can be classified into the
following categories:
 Manufacturer Brands: These brands are owned and produced by the
company that manufactures the products. Examples include Nike, Apple,
Unilever and Sony.
i. Nike: Nike designs, manufactures, and markets athletic shoes, apparel,
equipment, and accessories. The brand is owned by Nike, Inc., and the
products are produced in their own facilities or contracted manufacturers.
ii. Apple: Apple Inc. designs, manufactures, and markets consumer electronics,
software, and services. Products like iPhone, MacBook, and iPad are all created
and owned by Apple.
 Distributor Brands (Private Labels): These brands are owned and
marketed by wholesalers or retailers rather than the manufacturers. They
are often sold exclusively in the retailer's stores. Examples include Great
Value (Walmart), and AmazonBasics (Amazon).
i. Great Value (Walmart): Great Value is Walmart's private label brand,
offering a variety of products, including groceries, household essentials, and
personal care items, sold exclusively at Walmart locations.
ii. AmazonBasics (Amazon): AmazonBasics is Amazon's own brand offering a
wide range of products, including electronics, home goods, and office
supplies, available exclusively on Amazon's platform.
 Licensed Brands: These brands are owned by one company but
licensed to another company for production and distribution. The
licensee pays royalties or fees to the brand owner for the right to use
the brand name and associated trademarks. Examples include
designer fragrances licensed to beauty companies.

i. Designer Fragrances: Many designer fashion houses, such as Calvin

Klein, Ralph Lauren, and Gucci, license their brand names to beauty
companies for the production and distribution of perfumes bearing their
brand names.
ii. Starbucks: Starbucks licenses its brand for a variety of packaged coffee
products sold in grocery stores, as well as branded merchandise including
mugs, tumblers, and accessories.
On the basis of product line, brands can also be classified as
1. Family brands
2. Individual brands
 Family Brands:
 Family brands are brands that offer a variety of products or services under a single brand
name. These products or services may be related or unrelated, but they all benefit from
the overall brand recognition and reputation.
 Example:
 Procter & Gamble (P&G: P&G offers a wide range of consumer goods including:
i. household cleaning products (such as Tide detergent and Mr. Clean),
ii. personal care products (such as Pantene shampoo and Gillette razors),
iii. healthcare products (such as Crest toothpaste and Vicks cough medicine).
 All of these products are sold under the P&G umbrella brand, leveraging its reputation for
quality and reliability.
 Unilever: The company offers a diverse portfolio of consumer goods across
categories such as food, personal care, and home care. Some of its well-known
brands include Dove (personal care), Knorr (food products), Lipton
(beverages), and Axe (men's grooming). These brands are united under the
Unilever umbrella, leveraging the company's global presence and brand
equity.
 Individual Brands:
 Individual brands are standalone brands that focus on a single product or
product line. Unlike family brands, individual brands do not encompass a
diverse range of products but instead concentrate on building a distinct identity
for a specific offering.
 Example:
 Coca-Cola: While The Coca-Cola Company owns multiple brands, Coca-Cola
itself is an individual brand that focuses primarily on carbonated soft drinks.
Despite the company's diverse portfolio of beverages, including Sprite and
Fanta, Coca-Cola maintains its own distinct identity with iconic branding and
marketing campaigns centered around its flagship product.
PACKAGING
 Packaging is the basic necessity of every product. Without packaging the
product cannot be stored or moved from one location to another. Packaging
provides an identity to the product.
 Therefore, packaging is the process of providing a protective and informative
covering to the product in such a way that :
i. It protects the product during material handling,
ii. Storage and movement and
iii. Provide useful information to all the concerned parties about the content of the
package.
 Philip Kotler
 “Packaging includes the activities of designing and producing the container
or wrapper for the product.”
The following materials are
generally used for packaging:
(i) Wood
(ii) Metals
(iii) Plastics
(iv) Paper
(v) Glass
Packing and Packaging
 Packaging is a broader concept involving the design, production, and
use of materials and containers to protect, contain, and present products
throughout their lifecycle. It includes considerations such as product
protection, branding, and sustainability.
 Example: Designing a visually appealing and informative label for a food
product, along with selecting appropriate packaging materials to ensure
freshness and safety during transportation and display.

 Packing is the process of putting items into containers or wrapping

them for storage, transportation, or shipping purposes. It focuses on the
practical aspects of preparing goods for distribution. It is a subset of
packaging that refers to wrapping up the product and containing it in a
case or wrapper to protect it and aid in handling.
 Example: Placing individual items into cardboard boxes for shipment.
Functions of Packaging:
 Protection: Packaging protects products from damage, spoilage,
contamination, and tampering during storage, transportation, and handling.
It helps ensure that the product reaches the consumer in good condition.

 Containment: Packaging holds the product securely in place, preventing it

from shifting or spilling. This is particularly important for liquid, powdered,
or fragile items.

 Identification: Packaging provides information about the product, such as

its name, brand, features, ingredients, usage instructions, and safety
warnings. Clear labeling helps consumers make informed purchasing
decisions.

 Differentiation: Packaging distinguishes one brand's products from

another, helping to create a unique identity and stand out on store shelves.
Eye-catching packaging designs and innovative shapes can attract
consumer attention and drive sales.
 Convenience: Packaging is designed to make products easy to use, store,
and carry. Convenient packaging features such as resealable closures,
single-serve portions, and ergonomic shapes enhance the user
experience.

 Marketing: Packaging plays a crucial role in marketing and advertising

efforts. It serves as a visual representation of the brand and its values,
conveying messages about quality, authenticity, and lifestyle. Packaging
design can influence consumer perceptions and purchasing behavior.

 Sustainability: Increasingly, packaging is being designed with

environmental considerations in mind. Sustainable packaging aims to
minimize environmental impact by using recyclable, biodegradable, or
renewable materials and reducing excess packaging.

 Regulatory Compliance: Packaging must comply with various

regulations and standards related to product safety, labeling, and
environmental impact. Compliance ensures that products meet legal
requirements and consumer expectations
Levels of Packaging:

 Packaging can be categorized into several levels, each serving a specific

purpose within the distribution and marketing process.

 The levels of packaging typically include :

1. Primary,
2. Secondary, and
3. Tertiary packaging
Primary Packaging:
 Primary packaging is the layer of packaging that comes into direct contact with the
product. It is the packaging that consumers interact with when they use or consume
the product.
 Primary packaging serves to contain, protect, and preserve the product during
storage, transportation, and use.
 It is the primary layer like the plastic pouch, cardboard box, etc. containing the
finished product, that protects and preserves the finished product from
contamination and tampering, while including aesthetic elements that make the
product stand out.
 Often, removing the primary packaging of a product affects the product’s quality or
attribute.
 Examples of primary packaging include bottles, jars, cans, tubes, blister packs,
pouches, and trays.
Secondary Packaging:
 Secondary packaging is the outer layer of packaging that holds together multiple units
of the primary packaged product.
 Forms the second packaging layer that the customers don’t usually see. Its main use is
to group and hold together individual units of the product to deliver large quantities of
that product to the point of sale.
 It provides additional protection during transportation, facilitates handling, and may
serve as a means of branding and product differentiation.
 Secondary packaging also often contains important product information and
promotional messaging.
 Removing secondary packaging doesn’t affect the product’s quality or attribute
 Examples of secondary packaging include cardboard boxes, cartons, shrink wrap, and
multi-pack configurations.
Tertiary Packaging:
 Tertiary packaging, also known as shipping or transport packaging, is used for
bulk handling, storage, and transportation of multiple units of products.
 It is designed to protect primary and secondary packaging during transit and
distribution, ensuring that products reach their destination intact.
 Tertiary packaging is typically optimized for efficiency in logistics, such as
palletization and stacking, to minimize damage and maximize space utilization.
 The main objective of this packaging is to make it easier to transport heavy
loads or large quantities of a product easily and securely, while facilitating easy
storage and handling.
 Examples of tertiary packaging include pallets, stretch wrap, crates, and
shipping containers.
Essentials of a good package :
 Product Protection: The package should adequately protect the product from
damage, contamination, moisture, and other environmental factors during
storage, transportation, and handling.
Example : A vacuum-sealed pouch for coffee beans that protects them from exposure to
air, moisture, and light, preserving freshness and flavor.

 Functionality: The package should be easy to use, open, and reseal if

necessary. It should also be designed to fit the product well and provide
convenient access.
Example:A resealable plastic container for snacks with a convenient flip-top lid, allowing
consumers to easily access the snacks and seal the container to maintain freshness.

 Information: Clear and accurate product information should be provided on

the package, including ingredients, usage instructions, nutritional values,
expiration dates, and safety warnings.
Example : A cereal box with clear labeling indicating ingredients, nutritional information,
serving size, and preparation instructions, helping consumers make informed choices.
 Branding and Communication: The package should effectively
communicate the brand identity and key messaging through appealing
design, colors, logos, and graphics, helping to differentiate the product from
competitors and attract consumers' attention.
Example : A soda can featuring vibrant colors, the brand logo, and catchy slogans
that stand out on the shelf and convey the brand's identity and personality.

 Sustainability: With increasing environmental concerns, sustainable

packaging solutions are essential. The package should be made from
recyclable or biodegradable materials, optimized for minimal material
usage, and designed for efficient recycling or disposal.
Example :A compostable bag for organic produce made from plant-based materials,
reducing environmental impact and appealing to eco-conscious consumers.

 Consumer Appeal: The package design should resonate with the target
audience and evoke positive emotions, encouraging consumers to purchase
the product.
Example: A chocolate bar wrapped in visually appealing, colorful packaging with
elegant designs and textures that evoke a sense of indulgence and luxury.
 Practicality: The package should be practical for both consumers and
retailers, with considerations for shelf space, stackability, and ease of
transportation and storage.
Example: A stackable, space-saving packaging design for bottled water, allowing
retailers to efficiently display and store large quantities of product while minimizing
shelf space.

 Regulatory Compliance: The package must comply with relevant

regulations and standards for product packaging, including safety, labeling,
and environmental requirements.
Example:A pharmaceutical product packaged in accordance with FDA regulations,
including proper labeling of active ingredients, dosage instructions, and safety
warnings.

 Cost-effectiveness: The package design and materials should be cost-

effective while still meeting all functional and aesthetic requirements.
Example: A multipack of individually wrapped snack bars bundled together in a cost-
effective cardboard sleeve, providing value for both consumers and manufacturers.
Brand Equity

 Brand equity refers to the intangible value that a brand holds in the minds of
consumers.
 It's a measure of the brand's ability to generate recognition, preference, and
loyalty among customers, which ultimately translates into higher sales and
greater market share.
 It represents consumers' perceptions and experiences with the brand,
influencing their purchasing decisions and willingness to pay a premium for its
products or services.
 Strong brand equity contributes to market leadership, customer loyalty, and
long-term profitability for companies.
 It is a qualitative measure of the brand’s positive recognition or goodwill in the
minds of consumers. Represents overall value of brand in the market.
 The study of brand equity is concerned with how and what makes brands
more valuable, stronger and receptive to the consumers in the market place.
 Several key elements contribute to brand equity:
 Brand Awareness: The extent to which consumers can recognize or
recall a brand. Strong brand awareness means that consumers easily
identify the brand and its products or services.
 Brand Identity: This encompasses the visual and verbal elements that
distinguish a brand, including its logo, tagline, colors, and other brand
assets. Consistency in brand identity helps build recognition and trust.
 Brand Associations: These are the attributes, values, and
characteristics that consumers associate with the brand. Positive
associations can enhance brand perception and strengthen brand equity.
 Brand Loyalty: The degree to which customers repeatedly purchase
products or services from a particular brand over time. High brand
loyalty indicates strong brand equity and often leads to repeat
purchases and advocacy.
 Apple:
 Brand Awareness: Apple is widely recognized globally for its
innovative technology products, including the iPhone, iPad, and
MacBook.
 Perceived Quality: Consumers associate Apple products with high
quality, sleek design, and cutting-edge technology, leading to a
willingness to pay premium prices.
 Brand Loyalty: Apple has a dedicated fan base known for their strong
loyalty to the brand, often waiting in long lines to purchase the latest
product releases.
 Brand Associations: Apple is associated with attributes such as
innovation, creativity, and user-friendly interfaces, reinforcing its brand
equity.
Product Line & Product Mix
Strategies

What is product line?

&
What is product mix?
Product Line
 A product line refers to a group of related products under a single brand offered
by a company.
 These products may share similarities in terms of target market, distribution
channels, technology, or other factors.
 For example, a company that produces smartphones may have a product line
consisting of different models catering to various customer segments or price
points.
 They perform similar function and fulfill the identical needs and wants of the
customers.
 They are sold to the same customer groups.

 Here's a simple breakdown:

 Product Line:
 Refers to a group of related products marketed under a single brand.
 Examples: Apple's iPhone product line, which includes different models such as iPhone
13, iPhone 14 ,etc.
 Each product line may target a specific market segment or serve a particular purpose.
 Product Line Example: Nike Running Shoes
 Product Line: Nike offers a range of running shoes catering to different
types of runners and running activities.
 Examples of Product Lines within Nike's Running Shoes:
 Nike Air Zoom series (targeting serious runners with advanced cushioning and
performance features)
 Nike Free series (designed for runners seeking a more natural and flexible feel)
 Nike React series (emphasizing comfort and responsiveness for long-distance
running)
 Each of these product lines serves a specific segment of the running shoe
market, whether it's for performance athletes, casual runners, or those
seeking specific features like cushioning or flexibility.
Product Line Strategies

 Product Line Length

 Product Line Modernization
 Line Featuring
Product Line Length
 Product line length refers to the number of products within a specific
product line offered by a company.
 A longer product line typically means more variety and options for
customers.
 Managing product line length involves decisions about adding new
products, discontinuing existing ones, or modifying the range to meet
changing market demands and consumer preferences.
 EXAMPLE:
 Let's consider a coffee shop chain. Initially, they offer a limited product
line consisting of regular coffee, espresso, and cappuccino. To expand
their product line length, they introduce new offerings such as flavored
lattes (e.g., vanilla, caramel), cold brews, specialty teas, and breakfast
sandwiches. By doing so, they cater to a wider range of tastes and
preferences, increasing customer satisfaction and loyalty.
Product Line Modernization
 Product line modernization involves updating or refreshing an existing product
line to make it more competitive, relevant, and appealing to consumers in the
current market landscape.
 This may include incorporating new technologies, improving features,
redesigning packaging, updating branding, or enhancing overall quality to meet
contemporary standards and address evolving customer needs and preferences.
 EXAMPLE:
 Think about a smartphone manufacturer aiming to modernize its product line.
They introduce a new flagship model with upgraded hardware specifications,
enhanced camera features, and longer battery life.
 Furthermore, they implement software updates to improve user experience and
security. Additionally, they may integrate new technologies such as 5G
connectivity or foldable screens to stay ahead of competitors and meet the
evolving demands of consumers.
Line Featuring
 Line featuring refers to highlighting or showcasing specific products or product
lines within a company's offerings. This could involve promotional efforts, such
as advertising campaigns, product placements, or prominently displaying
certain products in retail stores or on e-commerce platforms. Line featuring
aims to draw attention to particular products or product lines to increase sales
and drive consumer interest.
 EXAMPLE:
 Imagine a toy company launching a new line of educational toys for
preschoolers. To feature their new product line, they collaborate with popular
parenting bloggers and educators to create engaging content highlighting the
educational benefits of the toys. They also organize in-store events where
children can interact with the toys and participate in educational activities.
 Additionally, they leverage social media platforms to showcase user-generated
content and encourage parents to share their experiences with the toys,
generating buzz and driving sales.
Product mix
 A product mix, on the other hand, refers to the total range of products
that a company offers.
 It encompasses all the different product lines within the company's
portfolio.
 A product mix can include both related and unrelated product lines,
depending on the company's strategic objectives and market
opportunities.
 Product Mix:
 Refers to the entire range of products offered by a company.
 Example: Apple's product mix includes not only iPhones but also other
product lines such as iPads, MacBooks, Apple Watches, etc.
 The product mix reflects the diversity and breadth of the company's
offerings.
 Product Mix Example: Samsung Electronics
 Product Mix: Samsung Electronics offers a wide array of electronic
products across various categories.
 Examples of Product Lines within Samsung's Product Mix:
 Samsung Galaxy smartphones (including flagship models like Galaxy S series
and mid-range models like Galaxy A series)
 Samsung Galaxy tablets (offering different sizes and specifications to cater to
different user needs)
 Samsung Smart TVs (ranging from basic models to high-end QLED and 8K TVs)
 Samsung home appliances (such as refrigerators, washing machines, and
microwaves)
 Samsung laptops and computers (offering diverse options for consumers and
professionals)
 Samsung's product mix covers a broad spectrum of consumer electronics
and appliances, catering to various lifestyle and technological needs of
customers.
So, in simple terms, a product line is a group of related products, and a
product mix is
the complete collection of all the products a company sells.
Product Mix Strategies
Product mix is the set of all product lines and items that a particular seller
offers for sale.
 Product’s Width
 Product Depth
 Product Length
 Product Consistency
Product Mix Strategies
A.Product Width
 It refers to the number of product lines a company offer. Product width can
be modified by adding or deleting a product line. e.g electronics company
offer product lines for smart phones, tablets, laptops , smart watches etc.
 P &G offers a wide product mix that includes household cleaning products
(Tide), personal care items (Crest Toothpaste), beauty products ( Olay
Skincare), baby care (Pampers Diapers)
 The width of a product mix refers to the total number of product lines a
business has. For example, if a breakfast food company has a product line
for hot cereal, cold cereal and breakfast snacks, it would have a width of
three because it has three product lines.
B.Product Depth
 It refers to the number of product items in a product line. The
variations within each product. e.g a smartphone product line may
include different colors, storage capacities, etc.
 Apple’s iphone product line includes different models (iphone 13,
iphone 15 promax), each with various configurations (storage
capacity, color options) and accessories.
 Depth is the number of variations within a product line. Variations
consist of different sizes, flavors, colors or other distinguishable
characteristics. If the breakfast food company's product line for hot
cereal included strawberry, apple, banana and cinnamon flavors, the
depth of that particular product line would be four.
C.Product Length
 It refers to total number of product items in the product mix. e.g in
smartphone product line may include different models with varying
features and price points.
 Within Nike product line , there are various models of shoes (Air max,
React, Zoom), apparel (T-shirt, Shorts, Jackets).
 The length includes the total number of products in the mix. For
example, if the breakfast food company had three product lines and
each line had four products, the length of the mix would be 12.
D.Product Consistency
 It refers to how closely related the various product lines are.
Consistency can be increased by adding closely related product lines. It
can be decreased by adding unrelated product lines. e.g skincare
products and makeup products.
 Starbucks maintains consistency in product mix by offering coffee
beverages, tea, pastries and snacks, all catering to the same target
market of coffee lovers and café goers.
 The consistency of the product mix refers to how closely products relate
to each other in terms of use, distribution channels or type of consumer.
The breakfast food company is likely going to have a higher consistency
of product lines than a retail company that sells shoes, clothes and
home goods.