Marketing

Chapter 8
Product and Branding

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Learning Objectives
After studying this chapter you should be able to:
8.1 Understand the concept of product in marketing
8.2 Describe the components of the product mix
8.3 Examine the concept of brand management
8.4 Discuss managing for brand value

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The Concept of Product (1 of 9)
• Define the types of things that qualify as marketing
“products”
– Product – What is being marketed:
1. Physical
2. Service
3. People
4. Place
5. Organization
6. Experience
7. Event
8. Idea
9. Cause
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The Concept of Product (2 of 9)
• Define the types of things that qualify as marketing
“products”
– There are big differences between physical and service
products. Services are discussed in depth in Chapter 9.

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The Concept of Product (3 of 9)
Figure 8.1 How Do Physical Products and Services Differ?

Characteristic Physical Product Service Impact on Marketing

Properties • Tangible, can be • Intangible – the service • Products can be

seen or touched itself is a process or viewed, tried, and
• Can often be bought procedure that is shared as part of the
in quantities, and performed on or for the marketing effort.
inventoried consumer • Services often
• Cannot be stored cannot be
experienced as part
of the marketing
efforts
Customizability • While some products • By definition, each and • Marketing for
can be customized, every service is unique services can focus
tailored, or styled, and specific to the on customization,
most products are individual consumer and and promote
intended to be their specific situation and specific, unique
marketed as is needs. Sometimes the examples of service
differences are subtle and capabilities
small, other times, quite
significant.

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The Concept of Product (4 of 9)
Characteristic Physical Product
Importance of • Generally speaking, for a
the Individual physical product (other
than maybe the inventor),
a specific single individual
is not specifically identified
with a product (e.g., you
don’t know the names of
the people who built your
phone)
Location • Not typically an issue—if a
product is not mass
marketed and widely
distributed, it likely can be
accessed through some
sort of shipping method
Service
• Service is very specific to
the individual delivering it,
as each individual has
different training, skills,
capabilities, and
personality connection
with the consumer. Many
people are loyal to a
specific person who cuts
and styles their hair and
would follow them if they
moved to another salon.
• Location is not an issue
for services in which the
presence of the individual
is not required (e.g., tax
services)
• Location is critical for
services that are
performed directly on the
consumer (e.g., dentist)
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Impact on Marketing
• Services marketing
often features an
individual who is
performs or manages
the performance of the
service.
• This can become an
problem if the person
becomes unassociated
with the service being
marketed or becomes
a less desirable
association
• A product can market
its broad availability
• A service may need to
choose a location that
is suitable for its
specific market
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The Concept of Product (5 of 9)
Characteristic Physical Product Service Impact on Marketing
Replicability • Although some products • Replication is virtually • A product can market its
are unique (custom impossible because the popularity, based on the
made, hand crafted or in individual nature of each number of units sold
limited supply for service exchange requires • Services marketing may focus
reasons of technical the availability of on how many consumers they
skill, time, or hard-to- individuals who can only have serviced, but promising
access inputs) generally produce a limited amount a specific reproduction of past
many duplicates of of work at any time. There performance is hard to do
physical products are is no way to “scale up” or (e.g., warnings on financial
possible mass produce personal services products indicating
services. “past results may not be
indicative of future
performance”)
Consistency • If desired, consistency is • Consistency is very hard to • Marketing for a product may
quite achievable— achieve (although the focus on either the product’s
almost everyone wants person who cuts your hair uniqueness or its consistency
their favourite soft drink may try!) due to the —depending on the product
or beer to taste the number of variables and the consumers’ desire
same every time, every involved in each exchange, • For services, consistency is
place and the dependency on the less important than reliability
consistent capabilities of or experience
individual people

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The Concept of Product (6 of 9)
• Define the different properties of a product
– Products in marketing consist of the following
components:
1. Core benefit ― Aspect of the product that motivates
us to explore the category; the problem the product
solves
2. Actual product ―The complete set of features and
components that a consumer is likely to directly
interact with, and that define the product offering
3. Extended product ― Something that must be
purchased or utilized with the product, but that is
not part of the core benefit

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The Concept of Product (7 of 9)
Figure 8.4 Smartphone: Full Product Model

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The Concept of Product (8 of 9)
• Distinguish among different categories of products
– Products in marketing can also be identified by how they
are categorized by consumer experience:
1. Convenience products
2. Shopping products
3. Select products
4. Unsought products

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The Concept of Product (9 of 9)
Figure 8.5 Grouping Product Categories

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The Product Mix (1 of 4)
• Describe the components of the product mix
– Product mix — The choice of which varieties of products
to offer and market
– Product line — The collection of different products in the
same category offered by an organization

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The Product Mix (2 of 4)
• Understand the concept of product line depth
– Product line depth — Products offered by one company
in similar and related categories; the multiple offerings in
any one category:
1. Changing consumer dynamics
2. Category and brand opportunities
3. Increased segmentation
4. Competitive response
5. Success in other markets
6. Acquisition or merger

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The Product Mix (3 of 4)
• Understand the concept of product line breadth
– Distinguishing between depth and breadth:
1. Line delivers different category benefit
2. Lines are non-complementary
3. Number of items in the line
4. Number of product lines marketed
5. Industry definitions
6. Nature of competition
7. Distinctness of brands
8. Channel distinction

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Why breadth? Why do organizations
add to their product lines?
• Diversification
• History
• Serendipity
• Merger/Acquisition
• Complementary
• By-Products and Related Industries
• Making Use of Existing Resources

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The Product Mix (4 of 4)
– Product line management:
▪ Product line substitution ― Rotating or replacing an
underperforming or unfavourable product with
another that is more suitable and potentially more
popular
▪ Product line expansion ― Adding new selections to a
product line, growing its total number of offerings
▪ Product line contraction ― Reducing the total number
of offerings by eliminating some products
▪ Product line cannibalization ― The extent to which
sales and consumers of newly added products come
from sales and consumers of previous products

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Brand Management (1 of 12)
• Examine the concept of brand management
– Brand (Branding) ― A form of identity for a product,
service, organization, or even an individual; the
reputation, notoriety, or point of distinction
– Brand management ― Providing responsibility for
development, promotion, growth, modification, or
refurbishment of a brand to an individual or group
– Brand director― A mid- to senior-level manager called
upon to oversee an entire category and possibly
manage individual brand managers within the category.
– Brand strategy ― A formal plan that determines what the
brand stands for, how it will be used, and how to
manage the brand effectively to help accomplish the
organization’s marketing goals
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Brand Management (2 of 12)
• Understand the origins and growth of branding
– Brands originated as a means of identification
– With expansion and distribution, brand came to also
encompass reputation and points of distinction

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Brand Management (3 of 12)
• Understand what can be used as a brand
– We tend to think first of a name, or possibly a logo, but a
brand can be identified in a number of ways (see Figure
8.6)

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Brand Management (4 of 12)
Figure 8.6 What Identifies a Brand?

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Brand Management (5 of 12)

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Brand Management (6 of 12)

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Brand Management (7 of 12)
• Identify how marketers organize their brands
– Marketers not only may have many distinct brands, they
may have brands which are related in some way:
▪ Brand hierarchy ― The determination of how to use
the corporate brand and various product brands
together to develop a clear, standard message to
consumers (Eg Major Car Companies)
▪ Corporate brand ―The organization’s name as the
primary brand (Eg Zara)
▪ Product brand ― Selected exclusively for a particular
product line the organization markets (There is no
“Procter & Gamble” product)
▪ Sub-brands ― A subordinate variant of a larger brand
(Eg Diet Coke, Coke Zero)
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Brand Management (8 of 12)
• Understand the brand planning process
– Brand plan — The collection of activities surrounding the
use of the brand, defining how the brand will be used,
developed, altered, extended, and placed in the coming
year to maximize the objectives of the organization

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Brand Management (9 of 12)
Figure 8.7 Breakdown of a Brand Plan

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Brand Management (10 of 12)
• Understand the brand planning process
– Brands play a strong role in promotional activity (see
Figure 8.8)

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Brand Management (11 of 12)
Figure 8.8 How Brands Play a Strong Role in Promotional
Activities
Advertising Brands play a prominent role in most advertising activities by being visually or
audibly prominent so that the consumer associates the advertising message
with the brand.
Some advertising is designed to define and reinforce what the brand stands for.
Packaging Packaging and advertising are the most prominent ways in which consumers
experience the brand. Brands on packaging identify the product, and reinforce
the connection between the consumer and the brand with every use.
Associations Brands are often used in association with organizations, causes, or events. For
example, many brands wish to be associated with international sporting events
like the Olympic Games, which attracts a global audience.
By associating a brand with a charitable event or cause, a brand realizes
positive benefits from being
recognized as a good corporate citizen.
Sponsorships Brands prominently sponsor teams, individuals, and events. The sponsorship
defines and reinforces what the brand stands for. In essence, these are living
examples of the brand ideal and positioning.

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Brand Management (12 of 12)
Display A display in store with prominent branding on it promotes the
brand, acts as advertising, and acts as a sales tool by
encouraging an immediate or additional purchase.
Brands as Some brands, such as Gucci, cross over into consumer
Fashion acceptance so strongly that the brand itself is something that
consumers themselves wish to wear.
Whether it is clothing displaying a prominent brand symbol, or
use of iconic brand images as a fashion design, consumers like
to associate themselves directly with some brands.
Brands as Some consumers feel so strongly associated with or passionate
Personal about a particular brand that they use it as an expression of
Identity personal identity. Often a tattoo, it can also be temporary, such
as a make-up design or hairstyle.
Endorsement/ Whether it is an Instagram influencer promoting a particular
Spokesperson brand or product or a retired sports figure hired to be a
spokesperson, brands use paid and unpaid associations and
recommendations of popular and influential individuals.

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Developing a good brand—are there
really “rules” for good names?
Practical and aesthetic considerations:
• Practical
– Legally Available
– Available Everywhere
– Translatable/Transliteral
– Any Issues? Offence? Local Issue?
• Aesthetic
– Distinct
– Memorable
– Says Something about the Products

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Managing for Brand Value (1 of 6)
• Understand what brands do
– To understand their financial value, we must first
understand all of the value that brands provide:
1. Identify
2. Promote loyalty
3. Lower marketing costs
4. Help global or other geographic expansion
5. Connect with consumers
6. Offer competitive advantage

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Managing for Brand Value (2 of 6)
• Understand what brands do (continued)
7. Raise the cost of entry
8. Support new products
9. Create profitability
10. Provide another layer of legal protection
11. Create a source of revenue (licensing)
12. Can become an actual financial asset

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Managing for Brand Value (3 of 6)
• Assess the financial value of a brand
1. Brands as financial asset
2. Brands as equity
3. Associations
4. Identity
5. Image
6. Increased consumer loyalty

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Managing for Brand Value (4 of 6)
• Assess the financial value of a brand (continued)
7. Intellectual property
8. Reduce marketing costs
9. Ease of new product introduction
10. Profit margins
11. Customer and distribution benefits
12. Manufacturing efficiencies

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Managing for Brand Value (5 of 6)
• Outline brand value protection
– Protecting brands can be categorized into two areas:
1. Protecting usefulness ― Brands are valuable tools
for organizations if they are managed effectively.
Some of the things that can impact a brand’s
usefulness are:
a. Confusion about what the brand stands for
b. Confusion with other brands
c. Problems with associations
d. Misuse or misrepresentation of the brand
e. Failure to support the brand
f. Changing tastes and catastrophic events

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Managing for Brand Value (6 of 6)
• Outline brand value protection (continued)
– Protecting brands can be categorized into two areas:
2. Legal protection and ownership – Brands must be
protected from theft and ownership established:
a. Registering the brand name
i. Not all brands can be legally protected this
way
ii. Brands must identify where they seek
protection
iii. Legal protection is not necessarily worldwide
b. Piracy
c. Imitation
d. Categorization
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Summary
• The concept of product has been defined
• The properties of a product have been categorized
• Different categories of products have been distinguished
• The concepts of product mix — line, depth, breadth, and
product line management — have been explored
• The concepts of brand management, brand hierarchy, and
brand plan have been introduced
• The concept of brand as a financially valuable tool has been
explored
• The need for brand protection has been articulated

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Mini Case: Dyson – winning by
changing the core benefit
1. The section makes the point that the focus of most
marketing activities is the actual product rather than the
core benefit, given that theoretically all products are
designed to deliver the benefit and their distinction is
based on how they do it. Companies like Dyson change
the game by resetting consumer expectations about what
to expect from the core benefit. What are the issues
associated with this strategy?

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Mini Case: Use of branding —
proactive and defensive
1. The mini-case of Procter & Gamble’s efforts to thwart
Unilever’s entry into the North American market is both an
example of the use of brands as defensive tools and the
power of brands to overcome obstacles. P&G thought they
could confuse and misdirect consumers through the use of
a similar brand; Unilever showed the power that a global
brand effort can have at succeeding. Research any
images, ads, video, or marketing and packaged goods
industry consumer journals to learn more. What were
some of the key elements that P&G used? Why do you
think Unilever was ultimately successful?

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Mini Case: P&G and Unilever —
product line breadth
1. Alone or in groups, students should be assigned different
global multi-product companies – packaged goods, food,
alcohol, vehicles, tech – and they should research how the
companies consider their product line breadth. It should be
easy to see how the companies have chosen to think
about and group their products from their available
information. Look at their closest competitor – do they do it
the same way? Is there a competitor who does it
differently? Why do you think the subject company does it
the way they do it? Do you agree?

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Mini Case: Oreo brand hierarchy
1. The example provided shows a unique approach to
branding based on a combination of history, company
acquisition, and timing of market entry. But there are
numerous other examples around the world of companies
marketing the same basic product but with different brand
names around the world. Research a couple and explain
why it is.

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Mini Case: Developing good brand
names
1. As the students to make a list of their favourite brand
names (i.e., not what brand concepts do they like and buy
most – what actual brand or product names do they like or
find interesting – regardless of whether they are
consumers). What do they like about them? What does
the brand say to them (especially if it is not a brand or
category the student uses)?
2. Does anything you think about the name relate to or from
the brand, or is it a different association?

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Mini Case: The value of brands to
consumers
1. This mini case outlines the questions of value, marketing
deception and manipulation, and consumer decision-
making. This is a debate that students should have
between two groups – one taking the side that brand is
valueless, meaningless, and a tax on unsuspecting
consumers, the other that consumers make their own
decisions, historically value and prefer and are willing to
pay premiums for brands, and that brands are reliable, and
an important part of the consumer experience.

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