BUS106 Marketing

Principles
Marketing Mix:
Product & Services
Lecture 2
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Icon Meaning Activity

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should take notes.
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information.
Individual Students complete an individual task.
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Group Activity Students discuss/ complete activities in

groups and report back to the class.

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some reading before the next class.
required

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successfully complete the subject. Seek
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help if you don’t understand.

Practice Students will complete these questions as

practice for the exam.
Questions
 Learning Objectives
1. Define the term product, product item,
product line and product mix.
2. Explain the three layers of product.
3. Discuss and differentiate between the
various types of products.
4. Discuss the marketing uses of branding.
5. Discuss the marketing uses of packaging
and labeling.
 This Topic’s Big Idea

“The product offering is at the heart of an

organisation's marketing program.”
 Product VS Service?
Product – everything, Service – the result of
both favorable and applying human or
unfavorable, that a mechanical efforts to
person receives in an people or objects
exchange (Tangible) (Intangible)
How services differ
from products
The three layers
of product
 Total Product Concept
Everything, both favourable and unfavourable, that a
person receives in an exchange. Made up of:
Core product: The problem- Augmented product:
solving core benefits that Additional customer services
consumers are really buying and benefits that are built
when they obtain a product around the core and actual
products and support these
offerings
Tangible (Actual) product: A
product’s parts, styling, brand Potential product: Comprises
name and packaging that all possibilities that could
combine to deliver the core become part of the expected
produced benefits or augmented product.
 Product
Types & Classifications
 Types of
Consumer Products
Convenience product: A
relatively inexpensive item that
merits little shopping effort
• E.g. Coca-Cola, Panadol,
Rexona deodorant
Normally require wide
distribution in order to satisfy
customers’ needs and wants
and to achieve the company’s
profit goals
Shopping product: A product
that requires comparison
shopping because it is usually
more expensive and found in
fewer stores
Homogeneous shopping
products perceived as
basically similar, e.g. washers,
dryers, refrigerators
Heterogeneous shopping
products perceived as
essentially different, e.g.
clothing
 Types of
Consumer Products (Cont.)
Speciality product:
A particular item for which
consumers search
extensively and are
reluctant to accept
substitutes
• E.g. luxury cars, gourmet
restaurants
Whilst all speciality products
are also shopping products,
not all shopping products
are speciality products
Unsought product: A
product unknown to the
potential buyer or a known
product that the buyer does
not actively seek
Watch Me:
https://www.youtube.com/watch?v=G-
p0TWVi0vw
https://www.youtube.com/watch?v=6XFz-
kncUtE
 Types of
Consumer Products (Cont.)
Product Items, Lines, Mixes
 Benefits of Product Lines
Why form product lines?
• Advertising economies of scale
• Package uniformity (common look but still keeping
their individual identities)
• Standardised components thus reducing
manufacturing and inventory costs
• Efficient sales and distribution
• Equivalent quality across all the products in the
line
https://www.fritolay.com/snacks/full-list-of-brands
 Product Mix Width and
Line Depth
Product line width: The number of product
lines an organisation offers
Product line depth: The number of product
items in a product line:
– Attracts buyers with different preferences
– Increases sales/profits by further
market segmentation
– Capitalises on economies of scale
– Evens out seasonal sales patterns.
 Product Modification
Changing one or more of a product’s
characteristics:
Quality modification: changing a product’s
dependability or durability
Functional modification: changing a product’s
versatility, effectiveness, convenience or safety
Style modification: changing a products
aesthetic; for example, style changes in
clothing
 Planned Obsolescence
The practice of modifying
products so they become
obsolete before they
actually need
replacement

Marketers contend that

consumers, not
manufacturers and
marketers, decide when Adopted from: Haibel, C, 2012, Overview of highly accelerated life test

styles are obsolete. (Halt), ASQ, viewed on 11th of August 2017

https://www.slideshare.net/ASQwebinars/overview-of-highly-accelerated-
life-test-halt
 Product line extension
and contraction
Product line extension
Adding additional products
to an existing product line
in order to compete more
broadly in the industry
Product line
contraction
The elimination of
unpopular sizes, flavours
and variations to
concentrate on successful
product lines
Image adopted from: Line
Extension Intervention 2008,
Ries’ Pieces, viewed on 11th
of August 2017
http://ries.typepad.com/ries_
blog/2008/10/line-extension-
intervention.html
 Brand
A name, term, symbol, design or
combination thereof that identifies a
seller’s products and differentiates
them from competitors’ products

Watch Me:
https://www.youtube.com/watch?v=sQLlPC_alT8
 An Effective Brand Name:
• is easy to pronounce
• is easy to recognise and remember
• is short, distinctive and unique
• describes the product, use and benefit
• has a positive connotation
• reinforces the product image
• is legally protectable
• translatable into other languages
Benefits of Branding
Branding Definitions
 Brand Loyalty
Where there is a Brand personality
consistent preference provides the brand
for one brand over all relationship with:
others – Depth
• Two elements for – Feeling
brand loyalty – Liking
• Relationship between
the brand as a person
and the customer
• Brand personality
Brand dimensions, traits and
examples
 Brand Strategies
First decision: to brand or not to brand?
If branding, then which one?
Manufacturer’s, Private (distributor), or Both?
Second decision: individual or family branding?
 Brand (cont.)
Manufacturers’ Brands Individual brands
VS. Private Brands VS. family brands

Manufacturer’s brand: the Individual brand: using

brand name of a different brand names for
manufacturer different products
Private brand: a brand Family brand: marketing
name owned by a wholesaler several different products
or a retailer under the same brand name

Captive brand: a brand manufactured by a third party for an

exclusive retailer, without evidence of that retailer’s affiliation
https://www.woolworths.com.au/shop/discover/our-brands
 Co-branding
Placing two or more brand names on a
product or its packaging
 Trademarks
A trademark - is the exclusive right to use a
brand. A service mark performs the same
function for services: For example:
– Shapes
– Colour and logos
– Catchy phrases
– Abbreviations of names

A generic product name cannot be trademarked

 Packaging Function

Containing and
Promoting products
protecting products

Facilitating recycling
Facilitating storage,
and reducing
use and convenience
environmental damage

Watch Me:
https://www.youtube.com/watch?v=OWZoW4WaoL4
 Packaging Function (Cont.)
Persuasive labelling focuses
on a promotional theme or
logo with consumer
information being secondary
(e.g. claims such as ‘new’,
‘improved’ etc.)
Informational labelling is
designed to help consumers
make proper product
selections and lower their
cognitive dissonance after the
purchase (e.g. nutritional
information on food
packages)
Images adopted from:
Food labels: nutritional
information and ingredients
2014, Raising Children,
viewed on 11th of August
2017
http://raisingchildren.net.au
/articles/food_labels.html
BROTHERS ALL-
NATURAL FRUIT CRISPS
REVIEW 2014, The
Nutrition Twins, viewed on
11th of August 2017
http://nutritiontwins.com/br
others-all-natural-fruit-
crisps-review/
 Packaging Functions (Cont.)
Universal product codes
• A series of thick and thin vertical lines
(barcodes), readable computerised optical
scanners that represent numbers used to
track products
Quick response (QR) codes
• A series of black modules arranged in a
square design on a white background,
making something like a matrix barcode that
can store large amounts of product
information and links to other data sources
Watch Me:
https://www.youtube.com/watch?v=CSIJGNBHjXw
 Packaging Functions (Cont.)
Guarantee - A right that Warranty -The making of
the product will not break extra promises (verbal or
too easily, will work and written) by the
perform as generally manufacturer, supplier or
expected importer about their
• Promotes the quality products
and use of the product
• Declares the product
free of defects or
failures, or flag to the
consumer that if they
buy, their risk is
minimised Image adopted from: Base Products Corporation 2017, viewed on 11th of
August 2017 http://www.basepump.com/products/hydropump/
 Warranty Types
Voluntary warranty: promises made by a
seller, manufacturer or service provider about
what they will do if there is a problem with
goods or services
Express warranty: an understanding,
assertion or representation relating to the
quality or condition of goods or services, the
availability of servicing or parts for the goods or
services, or the availability of matching goods
 Next Week

Developing and Managing Products.