Marketing 5th Edition Grewal Solutions Manual
Marketing 5th Edition Grewal Solutions Manual
Marketing 5th Edition Grewal Solutions Manual
Manual
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
Chapter 11
Product, Branding, and Package Decisions
Learning Objectives
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
The product itself is important, but so are its associated services, such as support or
financing. Other elements combine to produce the core ¬customer value of a product: the
brand name, quality level, packaging, and additional features.
These products tend to be classified into four groups: specialty, shopping, convenience,
and unsought products. Each classification involves a different purchase situation and
consumer goal.
LO3 Explain the difference between a product mix’s breadth and a product line’s
depth.
Breadth, or variety, entails the number of product lines that a company offers. Depth
involves the number of categories within one specific product line.
LO4 Identify the advantages that brands provide firms and consumers.
Brands play important roles in enabling people to make purchase decisions more easily and
encouraging customer loyalty. For firms specifically, they also constitute valuable assets
and improve a company’s bottom line and help protect against competition.
Brand equity summarizes the value that a brand adds, or subtracts, from the offering’s
value. It comprises brand awareness, or how many consumers in the market are familiar
with the brand; brand associations, which are the links consumers make be-tween the brand
and its image; and brand loyalty, which occurs when a consumer will only buy that brand’s
offer. Brand equity also encompasses the concept of perceived value, which is a subjective
measure that consumers develop to assess the costs of obtaining the brand.
Firms use a variety of strategies to manage their brands. First, they decide whether to ¬offer
manufacturer and/or private-label brands. Second, they have a choice of using an overall
corporate brand or a collection of product line or individual brands. Third, to reach new
markets or extend their current market, they can extend their current brands to new
products. Fourth, firms can co-brand with another brand to create sales and profit synergies
for both. Fifth, firms with strong brands have the opportunity to license their brands to
other firms. Finally, as the marketplace changes, it is often necessary to reposition a brand.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
Whereas a brand extension uses the same brand name for a new product that gets
introduced into new or the same markets, a line extension is simply an increase of an
existing product line by the brand.
Similar to brands, packaging and labels help sell the product and facilitate its use. The
primary package holds the product, and its label provides product information. The
secondary package provides additional consumer information on its label and facilitates
transportation and storage for both retailers and their customers. Labels have become
increasingly important to consumers because they supply important safety, nutritional, and
product usage information.
Check Yourself: Several questions are offered for students to check their understanding of
core concepts. (PPT slide 11-6)
II. Product Mix And Product Line Decisions (PPT slide 11-7, 8)
1. Increase Breadth
2. Decrease Breadth
1. Increase Depth
2. Decrease Depth
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
Check Yourself: Several questions are offered for students to check their understanding of
core concepts. (PPT slide 11-12)
A. Value of Branding for the Customer and the Marketer (PPT slide 11-15)
Check Yourself: Several questions are offered for students to check their understanding of
core concepts. (PPT slide 11-21)
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
1. How do brands create value for the customer and the firm?
Answer: Branding provides a way for a firm to differentiate its product offerings
from those of its competitors and can be used to represent the name of a firm and
its entire product assortment, one product line, or a single item. Brand names, logos,
symbols, characters, slogans, jingles, and even distinctive packages constitute the
various brand elements firms use, 17 which they usually choose to be easy for
consumers to recognize and remember.
Check Yourself: Several questions are offered for students to check their understanding of
core concepts. (PPT slide 11-31)
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
2. What is co-branding?
Answer: Co-branding is the practice of marketing two or more brands together, on
the same package or promotion. Primarily due to credit card companies, such as
Visa and MasterCard, the practice has greatly increased in the past decade. Airlines
were among the first to co-brand with credit card companies (such as the United
Airlines Visa Card), but recently, firms in other industries, such as banking, retail,
and restaurants, have begun forming similar alliances. Starbucks was the first in the
quick-service restaurant industry to offer its own Starbucks credit card in alliance
with Visa. Co-branding can enhance consumers’ perceptions of product quality 70
by signaling “unobservable” product quality through links between the firm’s brand
and a well-known quality brand. For example, NutraSweet’s claim to be a sugar
substitute that was safe and left no aftertaste got a boost after both Coca-Cola and
Pepsi started offering products that contained it, was included on its labels and in
its promotions. Co-branding may fail if the brands’ owners cannot resolve financial
disputes about revenue or royalty sharing.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-2: Learning Objectives These are the learning objectives for this
chapter.
11-3: Red Bull Ask students: How many use energy drinks?
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-7: Product Assortment and Product Line This chapter uses Colgate-Palmolive brands as
Decisions examples.
11-8: Product Assortment and Product Line Students should understand that each item is
Decisions called a stock keeping unit (SKU) and the
category depth is the number of SKUs within a
category.
11-9: Change Product Mix Depth Ask students: What are the pros and cons of
offering competing products in the same
category?
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-10: Change Product Mix Breadth Ask students: Why would a company want to
increase its product mix breadth? Why would it
want to decrease it?
11-11: Product Line Decisions It increases depth by adding one more scent.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-14: What Makes a Brand? Group activity: Identify a brand that you
recognize primarily by each of these elements.
11-15: Value of Branding for the Customer Group activity: Have students pick a well-
and the Marketer established brand.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-16: History in Advertising This clip looks at the history of advertising and
how the industry has matured over time.
11-17: Brand Equity: Awareness Brand equity cuts both ways; customers dislike
some brands because of the firm’s actions or
their negative perceptions.
11-18: Brand Equity: Perceived Value These retailers offer designer products at
reduced prices.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-19: Brand Equity: Brand Associations Target teamed up with high-fashion designer
Jason Wu to create reasonably priced, yet very
fashionable apparel.
11-20: Brand Equity: Brand Loyalty Brand loyalty provides the firm with high value.
State Farm has built their brand equity by
having loyal customers.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-24: Brand Ownership There are two basic brand ownership strategies:
manufacturer brands and retailer/store brands.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
11-29: Brand Licensing The NBA licenses products like these bobble
head figures of Dallas Mavericks and San
Antonio Spurs players to a manufacturer in
exchange for a negotiated fee.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
Marketing Applications
1 LLBean guarantees that its products will last forever. What features of a pair of pants
from LLBean would be part of the actual product and which would be part of the
associated services?
Features of the actual pants product might include brand name, design, durability, quality,
fit and color. Features of the services associated with the delivery of the pants might
include customer service, product support, warranties, and L.L. Bean’s return policy.
2 Classify each of the following products into either convenience, shopping, specialty,
or unsought goods: toothpaste, Life insurance, Sharp TV, Eggo Waffles, lettuce,
Coach handbag, Adidas Soccer cleats, furniture.
Toothpaste, Eggo Waffles, and lettuce are likely convenience products because it is
frequently purchased with very little thought.
Life insurance is an unsought product. Unsought products are goods or services that
customers rarely think about purchasing or do not know about.
Sharp TV and adidas soccer cleats are examples of shopping products. Shopping products
are products that consumers will spend a fair amount of time comparing alternatives.
Furniture may be considered either a shopping product or a specialty product depending
on the consumer or the reason for purchase.
A Coach handbag would be considered a specialty product. Specialty products are those
for which customers have a strong preference and will spend a considerable amount of
time searching for.
3 Study the following two product mixes below are provided. Product Mix 1: A, B, C
and D are the lines and for Product Mix 2: X, Y and Z are the lines.
Which mix has more breath and why? Which mix is deeper and why?
A firm’s product mix breadth represents a count of th enumber of product lines offered by
the firm. Product mix 1 has greater breadth because it offers four product lines versus
three in product mix 2. Product line depth equals the number of products in a product line.
Product mix 2 has greater depth because two of its product lines have four products in
them versus three in product mix 1.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
4 Suppose you are the coffee buyer at Kroger’s. There is a strong corporate initiative to
increase store label merchandise. Discuss the advantages and disadvantages of
offering private label coffee.
Private label brands (also called retailer/store brands) are products developed by retailers
who often contract with manufacturers to produce products. Store brands now account
for almost 20% of purchases in North America. By eliminating the middle man, retailers
can often enjoy higher margins on store brand products. In addition, when a customer
becomes loyal to a store brand, that brand is exclusive to the retailer, making the customer
loyal to the retailer as well. Many of today’s consumers perceive store brands as having
higher perceived value than their national counterparts.
5 Identify a specific brand that has developed a high level of brand equity. What
specific aspects of that brand establish its brand equity?
Student answers will vary. In picking a brand that they think has high equity value;
students should explore why they believe it has high value and what determines that value.
You could also review the top brands listed in the book and ask students to discuss why
these brands may be considered to have higher levels of equity than other brands.
IBM has developed a high level of brand equity through its longevity, its global reach, its
reputation for innovation and Nobel Prize–winning work, the quality of its products, its
sponsorship of sporting and cultural events, and the high level of customer service it
provides to its customers.
6 Are you loyal to any brands? If so, pick one and explain why you believe you are
loyal, beyond that you simply like the brand. If not, pick a brand that you like and
explain how you would feel and act differently toward the brand if you were loyal to
it.
Student answers will vary. This question challenges students to consider exactly why they
may be brand loyal toward one product but not another, which may be because of product
characteristics, the students’ experience, or their opinion of the company that provides the
product. Therefore, they might mention that they only purchase that brand to the exclusion
of all others, they purchase the product frequently, and they often visit the store that sells
it.
For example, some students might claim that they are loyal to Starbucks, in that they
generally do not get coffee from any other retailer unless there is absolutely no Starbucks
within reasonable walking or driving distance.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
7 Sears owns several store brands, including DieHard, Kenmore, and Craftsman. Each
brand features many models that may appeal to various customer groups. Wouldn’t it
be easier to just identify them all as Sears? Justify your answer.
8 Do you think all edible items sold in a grocery store should have an ingredient and
nutrition label? Consider the perspectives of consumers, the manufacturer, and the
store.
To expand students’ understanding of the roles and responsibilities of the different parties,
this question challenges them to consider the benefits and costs of labels for each group.
Most food in a grocery store should have an ingredient and nutrition label, with the
exception of, say, unpackaged produce. Consumers can make more informed purchase
decisions, and the store might improve its customer satisfaction, because its shoppers know
that all the information they need appears on every product package. From the perspective
of the manufacturers, however, broader labeling might seem intrusive and could make
sales of cheaper quality, high fat, and high sugar foods more difficult; thus, rather than
seeing it as an opportunity to connect positively with consumers, manufacturers might
object to comprehensive labeling.
9 You are the brand manager for a firm that makes herbs, spices, and other food
additives. You have had complaints from some of your retail outlets that they are
finding empty bottles of pure vanilla extract stashed around the store. Apparently, due
to the high (35 percent) alcohol content of pure vanilla extract, people are grabbing
the cute little bottles, having a drink, and getting rid of the evidence. Anecdotal
evidence from store employees indicates that the majority of the imbibers are
teenagers. The cost of placing a tamper proof cap on the extract is a relatively
insignificant percentage of the purchase price, but will make it more difficult to open,
particularly for older customers. Also, there has been a significant rise in sales to
retailers as a result of the vanilla bean “addicts.” What should you do?
Student answers will vary. This question leads the student to examine the ethical aspects
of packaging and its impact on the brand.
Students should address the low cost of the tamper proof cap and its benefits to keeping
the product safe and solving the problem. Though the vanilla bean target market also
includes the elderly, the brand can address that by having a fairly easy tamper-proof design
such as a foil tab lift off. In the end, it is better to make the product safe for the customer
which also thwarts the vanilla bean addicts.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
Quiz Yourself
Strong brands protect the firm somewhat from competition because the brand differentiates
the firm's products, making customers more loyal.
A. name.
B. symbol.
C. design.
D. term.
E. all of these.
The "swoosh" is a brand symbol associated with Nike. The firm has invested a great deal
of time and money in making the swoosh one of the most recognizable brand symbols in
the world.
Net Savvy
Student’s answers will vary. MAC offers a variety of product lines including product lines
for lips, eyes, nail color, hair color, and beauty tools. These product lines make up the
depth of MAC Cosmetic’s product mix. Within each line, MAC has several products. The
nail color and lip color line have numerous products of varying colors and benefits. These
lines have significant product depth. Some of MAC Cosmetic’s other product lines might
have fewer products in them.
Some of BMW’s new brand extensions include the new X5 SUV and the 4-series coupe.
These products are very similar to current products that the firm offers, and will therefore
only add to BMW’s market share rather than harming the firm.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
Oprah categorizes her products by: spirit, health, relationships, fashion and beauty, books,
food, entertainment, home and garden, and money. This website also sells Oprah’s books,
videos, and O magazine. Each of these product lines is targeted towards Oprah’s primary
customer, women, and is founded in Oprah’s motto to “live your best life.”
The breadth of the product lines vary depending on the product line. The items listed for
fashion and beauty and health for example, are far more inclusive than items for food or
entertainment.
3 Review the different product categories in each of the company’s product lines.
Which has the greatest depth? Which has the least??
Oprah categorizes her products by: spirit, health, relationships, fashion and beauty, books,
food, entertainment, home and garden, and money. In terms of articles and coverage
provided, all of the product lines seem to have an equal amount of depth.
4 How has the company positioned its brand? How does it go about communicating its
position?
The company has positioned its brand to meet the needs of women and help women live
their best life. Oprah is one of the best known brands in the world, and the Oprah website
ties all of the products back to Oprah, indicating that she endorses them.
This chapter examines product lines, mix, and breadth. Different branding strategies are
addressed. Students use critical thinking skills to discover why brands are valuable to a
firm. Product packaging and labeling also contribute to the firm’s overall strategy and
those concepts are also reviewed in this chapter.
This is a fun exercise to get students excited about brands. To demonstrate the value of
a brand, instructors may want to start the topics discussion by gathering brand symbols
(such as below) and brand character icons such as the ones below without any identifying
writing on it. These can be obtained through a Web search of the character for instance
type “Tony the Tiger” in your search engine and download the graphic. Place the symbols
on a transparency in color. Start the class by dividing the class into four or five groups.
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Chapter 11 - Product, Branding, and Package Decisions Marketing 5th
The instructions: The leader is to write down the brand name from input of group members.
Time the exercise. It usually doesn’t take long depending how many characters you use.
At the conclusion declare a winner and then ask the students “Why are brands valuable?”
Students realize the importance of brand recognition through the brand character or icon.
Online tip: The same exercise can be used in an online forum in synchronous connection
with the class where each of the brand characters are shown. The first student that types in
the correct brand name would ‘win’ and the instructor shows the next image. A
synchronous course discussion can then occur about the importance of the brand
character/logo.
Product packaging is known as the last five seconds of marketing. Instructors can bring in
an empty Pringle’s can as well as other interesting examples of packing. Pringles is one of
the first package designs to protect from breakage of food items such as potato chips. The
class can address how packaging becomes the last five seconds of marketing. Package
label requirements by the FDA and package design for shelf space should also be
addressed.
Remember to review the Newsletter for Instructors and its accompanied PowerPoint
presentation, which integrates examples and discussion from the newsletter. Each
newsletter contains over ten article abstracts on hot topics, plus a selection of current
commercials and videos for you to use with your class. The newsletter also includes a
guide that explains where the articles, commercials, and videos best fit in your Marketing
course.
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.