Marketing Chapter 8

Chapter 8: Product Decisions
Product Levels
 Core Benefit: Most fundamental level. Fundamental service or benefit that the customer buys. Core
benefit is directly linked to the most basic or fundamental need that the buyer wants to satisfy.
 Basic Product: Marketer has to convert the core benefit into a basic, tangible product. At this level
the manufacturing department and the marketing department have to co-operate closely to ensure
that the basic tangible product is able to offer the need-satisfaction benefits that customers want.
 Expected Product: A set of attributes and conditions that buyers normally expect and agree to when
they purchase this product.
 Augmented Product: Not only meets the customers desires and expectations but sometimes
exceeds them. Exceeding expectations is a way of differentiating a product and establishing a
competitive advantage. It is a holistic assessment of the way a purchaser of a product goes through
the buying and consumption process and links this to the satisfaction of specific pre-purchase
needs.
 Potential Product: The marketer addresses the possible future evolution of its product with a view to
increasing customer satisfaction and thereby also differentiating the product from those of
competitors.
Branding
The success of any business depends in part on the target markets ability to distinguish one product from
another.
 Brand: A name, term, symbol, design or any combination that identifies a sellers products and
differentiates them from competitors products.
 Brand Name: Can be verbalised
 Brand Mark: Elements of the brand that cannot be verbalised
Benefits of Branding
 Product Identification:
 Repeat Sales (Loyalty)
 Enhancing New Product Sales (New Products on the Market):
Benefits for Marketers
* Branding allows marketers to distinguish their product from all others. Means of differentiation and can
become competitive advantage. Effective branding allows firms to charge a price premium for their product
if it is properly differentiated.
Benefits to Consumers
 Consumers benefit from the easy identification that branding makes possible. Besides easier
shopping (Reduced Buying Time), Banding offers the buyers security and confidence of buying a
product they are familiar with in terms of reliability &Quality.
Brand Equity: Refers to the monetary value of brand names. A brand with strong brand equity is a valuable
asset.
High Brand Equity Leads To:
 High Awareness:
 Perceived Quality:
 Brand Loyalty:
Features of Effective Brand Names
1. Easy to Pronounce
2. Easy to recognise
3. Easy to remember
4. Are short
5. Are distinctive/Unique
6. Describe the Product
7. Describe the Use
8. Describe Benefits
9. Have Positive Connotation
10. Reinforce Desired Product Image
11. Legally protectable in home and foreign markets
No brand exhibits all characteristics, most important issue is that the brand can be protected for exclusive
use by its owners. The best generator of repeat sales is satisfied customers.
In addition to product identification, an important purpose of branding is to facilitate sales, and particularly
new-product sales. Company names and brand names are extremely useful when introducing new
products, or when facing competitive environment.
Branding Strategies
One of the essential strategies for maintaining and growing a brand is consistency in the brand positioning
and the communication of the brand.
 Generic Products vs. Branded Products: Generic product is typically no frills, no-brand-name, low-
cost product that is simply identified by its category. The main appeal of generics is their low price.
 Manufacturers Brands vs. Private Brands: Manufacturers brand more precisely defines the brands
owner, a private brand on the other hand, is a brand name owned by a wholesaler or retailer.
 Individual Brands vs. Family Brands: individual branding is using different brand names for different
products , most firms use individual brands when their products vary considerably in use, quality or
performance. On the other hand, a firm that markets several different products under the same
brand name is using family brand.
Conditions Favourable to Branding
Branding works well when there is sufficient demand to ensure continuity of the brand and to ensure that
the benefits of economies of scale are realised. Physical characteristics make branding unsuitable for some
product. E.g. cement, or nails.
Co-Branding
Combining branding efforts of two powerful brand names can exponentially enhance the brand awareness
and brand equity of both brands.
Risks Associated with Co-Branding
 Incompatibility of the partners

 Failure of the project because of financial or other strategic objectives not being met.
 A change of strategy or withdrawal of products.
 Breach of Contract, Insolvency or change on control of one of the participants
 Sudden Degeneration of a participants previously stainless reputation
 unauthorised use of a participants trademark.
Levels of brand Familiarity
 Brand Rejection: Potential buyer will not buy the product

 Brand Non-Recognition: Potential customers are simply not aware of the brand
 Brand Recognition: Consumers are aware of the brand, but not necessarily buyers.
 Brand Preference: Consumer regularly buys the brand ahead of others out of sheer habit or
because of satisfactory use in the past
 Brand Insistence: Consumers insist on a brand and are willing to search for it.
Relationships between Trademarks and Brands
Signifies the exclusive right to use a brand or part of a brand. A trademark is a legal concept and term
primarily used by the legal community. Brand is used by marketers and consumers. Brand is a less well-
defined concept than a trademark. The process used to create and manage a brand is known as branding,
which refers to the variety of marketing techniques that integrate a trademark with a business strategy in
order to create a unique image for the general public, referred to as the brand. Brands convey information
about the trademark behind the brand. Not all brands are trademarks but most trademarks are brands.
Parts of a Brand or other Product Identification may Qualify for Trademark Protection
 Shapes such as coca-cola bottle

 Ornamental Colour or design such as decoration on Nike tennis shoes
 Catchy Phrases 'How can we help you', 'Everywhere you go' & 'We try harder'
 Abbreviations such as Coke, M-Net, & MTN
Legal Implications of Branding
 One is able to register a trademark for a period of ten years, but can be renewed from time to time.
 Mark: Any sign capable of being represented graphically,, including a device, name, signature,
word, letter, numeral shape, configuration pattern, ornamentation, colour or container for goods of=r
any combination of these.

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Marketing Chapter 8

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Chapter 8: Product Decisions

Benefits for Marketers

High Brand Equity Leads To:

Features of Effective Brand Names

Conditions Favourable to Branding

Risks Associated with Co-Branding

 Incompatibility of the partners

Levels of brand Familiarity

 Brand Rejection: Potential buyer will not buy the product

Relationships between Trademarks and Brands

 Shapes such as coca-cola bottle

Legal Implications of Branding

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