Chapter 10 Product Design Product everything both favorable and not favorable that a person receives in an exchange Tangible good service idea starting point of the marketing mix Price Product Promotion Place Types of Products business product a product used to manufacture other goods or services to facilitate an organization s operations or to resell to other customers consumer product a brought bought to satisfy an individual s personal needs or wants Types of Consumer Products convenience product a relatively inexpensive item that merits little shopping effort shopping product a product that requires comparison shopping because it is usually more expensive and found in fewer stores specialty product a particular item for which consumers search extensively and are reluctant to accept substitutes unsought product a product known to the potential buyer or a known product that the buyer does not actively seek Product Lines Items Mixes product item a specific version of a product that can be designated as a distinct offering among an organization s products product line a group of closely related product items benefits advertising economies package uniformity standardized components efficient sales and distribution equivalent quality product mix all products that an organization sells Adjustments 1 Product modification quality modification functional modification style modification 2 Product repositioning why Changing demographics declining sales changes in social environment 3 Product line extension or contraction adding additional products to and existing product line in order to compete more broadly in an industry Symptoms of overextension some products have low sales or cannibalize sales of other items resources are disproportionally allocated to slow moving products items have become more obsolete because of new product lines planned obsolescence the practice of modifying so those that have already been sold become obsolete before they actually need replacement Branding brand name the part of the brand that can be spoken including letters words and numbers brand mark the elements of a brand that cannot be spoken brand equity the value of a company and brand names global brand a brand where at least 20 of the product is sold outside its home country benefits product identification repeat sales new product sales Branding Strategies manufacturer s brand the brand name of a manufacturer individual brand family brand combination advantages heavy consumer ad s attract new customers enhance dealer s prestige rapid delivery carry less inventory customers can switch brands but stay loyal to dealer private brand a brand name owned by a wholesaler or retailer aka private label or store brand individual family combination advantages earn higher profits on own brands less pressure to mark down price manufacturer can become a direct competitor or drop brand seller ties customer to wholesaler or retailer wholesaler and retailers have no control over the intensity of distribution on manufacturer s brands captive a brand manufactured by a 3rd party for exclusive retailer w o evidence of a retailer s affiliation advantage no evidence of stores affiliation sold exclusively at the chain can ask price similar to manufacturer s brands Individual brands vs Family brands individual using different brand names for different products family marketing several different products under the same brand name Cobranding types ingredient brand cooperative branding complimentary branding Trademark exclusive right to use a brand many parts of a brand and associated symbols qualify for trademark protection trademark right comes from use rather than registration mark has to be continuously protected rights continue for as long as the mark is used trademark law applies to the online world www uspto gov place u go to look for patents trademarks Packaging functions contain and protect promote facilitate storage use and convenience facilitate recycling innovations Labeling packaging tends to be the same size and shape easy customer comparison innovations for ease can be a competitive advantage persuasive focuses on promotion theme consumer information is secondary informational helps make proper selection lowers cognitive dissonance includes use care universal product codes UPC s a series of thick and thin vertical lines bar codes readable by computerized optical scanners that represent numbers used to track products Global Issues global options for branding 1 One brand name everywhere 2 Adaptations and modifications 3 Different brand names in different markets global considerations for packaging 1 Labeling 2 Aesthetics 3 Climate considerations Product Warranties warranty a confirmation of the quality or performance of a good or service express warranty a written guarantee implied warranty an unwritten guarantee that the good or service is fit for the purpose for which it was sold UCC