Lecture 5

Product and Services

Strategies

Dr Gamal Sayed AbdelAziz

Cairo University
 What is product?

Product
 Anything offered
to a market for
attention,
acquisition,
consumption or
use that might
satisfy a need
or want.
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 Service

 Any activity or
benefit that one
party can offer to
another that is
essentially
intangible and
does not result in
the ownership of
anything.

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 Figure 1:
Three Levels of Product

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 Discussion Question

Describe the core

benefit, actual
product, and
augmented product
aspects of an
automobile purchase.

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Classifying products

Product and service

classifications fall into
two broad classes based
on the types of buyers
who use them:
 Consumer products
 Industrial products

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 Consumer Products
Types of
Consumer Products
Frequent purchases
bought with minimal
buying effort and
Convenience little comparison
shopping
Shopping Low price
Specialty Widespread
distribution
Unsought Mass promotion
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 Types of
Consumer Products
Less frequent
purchases requiring
more shopping effort
and price, quality, and
style comparisons.
Convenience Higher priced than
convenience goods
Shopping Selective distribution in
fewer outlets
Specialty
Advertising and
Unsought personal selling by
producer and reseller9- 8
 Types of
Consumer Products Strong brand preference
and loyalty, requires
special purchase
effort, little brand
comparisons, and
low price sensitivity
Convenience
High price
Shopping Exclusive
Specialty distribution
Carefully targeted
Unsought promotion by
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 Little product
Types of awareness and
Consumer Products
knowledge (or if
aware, sometimes
negative interest)
Convenience Pricing varies
Shopping Distribution varies
Specialty Aggressive
Unsought advertising
and personal
selling by 9- 10
Industrial products
 Industrial products are those
purchased for use in conducting
a business or those purchased as
ingredients or components to be
used in manufacturing.
 Materials and parts
 Capital items
 Supplies and services
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Other types of products
 “Products” also include organizations,
persons, places, and ideas
 Organizational marketing makes use of
corporate image advertising
 Person marketing applies to political
candidates, entertainment sports figures, and
professionals
 Place marketing relates to tourism
 Social marketing campaigns promote ideas

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Social marketing
promotes ideas or
causes for the
purpose of
improving an
individual’s well-
being or the well-
being of society.

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Product & Service Decisions

Key Decisions
Product attributes
 Quality, features,
Individual style and design
Product Branding
Product Line Packaging
Product Mix Labeling
Product support 9- 14
 Figure 2
Individual Product
and Service Decisions

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Innovative product
design can help
revitalize a company,
such as with the Apple
iMac.

Brand:
 A name, term, sign,
symbol, design, or a
combination of
these, that identifies
the maker or sellers
of a product or
service.

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Packaging involves designing a
container or wrapper for a
product

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 Labeling

Many aspects of a food product’s

label are dictated by law

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Product support services

Support services
via the web
include FAQ files,
email queries, live
chat with
customer service
personnel, and
software updates

1-800 Flowers

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Product & Service Decisions

Key Decisions Product line is a group of

products that are closely
related because they:
1- function in a similar manner
Individual Product 2- are sold to the same
Product Line customer groups,
Product Mix 3- are marketed through the
same types of outlets or fall
within given price ranges.
For example, Motorola
produces several lines of
telecommunications
products.
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 Product mix or
Key Decisions assortment
consists of all
the product lines
Individual and items that a
Product particular seller
Product Line offers for sale.
Product Mix
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3 dimensions of product mix

Product line width:

 Number of different product
lines carried by company
Product line depth:
 Number of different versions of
each product in the line
Product line consistency
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Branding Strategy

Brands are powerful

assets that must be
carefully developed
and managed.
 Both Tiger Woods
and Nike can be
considered brands

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Brands with strong
equity have many
competitive
advantages:
 High consumer
awareness
 Strong brand loyalty
 Helps when
introducing new
products
 Less susceptible to
price competition

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Good Brand Names:
 Suggest something about the
product or its benefits
 Are easy to say, recognize and
remember
 Are distinctive
 Are extendable
 Translate well into
other languages
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Discussion Question

Evaluate the brand name

for the product at left
according to the criteria
previously listed.

Would you have chosen

this name for this product?

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 Brand Sponsorship
1- Private (store) brands
 Costly to establish
and promote 2- Manufacturer
 Higher profit margins brands

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3- Licensed brands
Name and character licensing has grown.

4- Co –branding

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Services Marketing
Services
 Account for 74% of
U.S. gross domestic
product.
 Service industries
include business
organizations,
government, and
private not-for-profit
organizations.
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 Figure 3
Four Services
Characteristics

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 Figure 4
Three Types of Marketing
in Services Industries

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Service Firm Marketing
Strategies

1- The Service-Profit Chain

 Internal Marketing: service firms
train and effectively motivate their
employees to work as a team to
satisfy the customer
 Interactive Marketing: recognizes that
service quality depends heavily on the

quality of buyer-seller interaction

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Service Firm Marketing Strategies
2- Managing Service Differentiation
British Airways differentiates its
service by offering first-class world
travelers private “demi-cabins”

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 Additional Product
Considerations

Product Decisions and Social

Responsibility
 Legal compliance
 Product liability issues
 Warranties

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 Additional Product
Considerations

International Product and Services

Marketing
 Special challenges:
 Which products should be marketed
internationally?
 Should the products be standardized
or adapted for world markets?
 How should packaging be adapted?
 How can other barriers be overcome?
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