After completing this chapter,

you will be able to

understand:
Product Decision
Product classification
Brand
Package
Product Life cycles
1
A PRODUCT is anything that
can be offered to a market to
satisfy a want or need.
Products that are marketed
include physical goods,
services, persons,
organizations, and ideas.

2
Durability, tangibility, and use (consumer or
industrial). Each product type has an appropriate
marketing-mix strategy.
1. DURABILITY AND TANGIBILITY
Products can be classified into three groups,
according to their durability and tangibility:
A. Non-durable goods: Non- durable goods are
tangible goods that normally are consumed in one or
a few uses.
Examples are beer, soap, and salt.
Since these goods are consumed quickly and
purchased frequently, the appropriate strategy is to
make them available in many locations, charge only a
small markup, and advertise heavily to induce trial
and build preference.

3
B. Durable goods: Durable
goods are tangible goods that
normally survive many uses.
Examples include
refrigerators, machine tools,
and clothing. Durable products
normally require more
personal selling and service
command a higher margin, and
require more seller 4
CONSUMER-GOODS CLASSIFICATION
Consumers buy a vast array of
goods. These goods can be
classified on the basis of consumer
shopping habits. We can distinguish
among convenience, shopping,
specialty, and unsought goods.
1. CONVENIENCE GOODS:
Convenience goods are goods that
5
2. Shopping goods: are goods
that the customer in the
process of selection and
purchase characteristically
compares on such based as
suitability, quality, price, and
style. Examples include
furniture, clothing, and major
appliances.
Shopping goods can be 6
Shopping goods must therefore carry a wide
assortment to satisfy individual tastes and must
have well-trained salespeople to provide
information and advice to customers.
 3. SPECIALTY GOODS: are goods with unique
characteristics and/or brand identification for
which a significant group of buyers in habitually
willing to make a special purchasing effort.
Examples include specific brands and types of
fancy goods, cars, stereo components,
photographic equipment, and men’s suits.
The dealers do not need convenient locations;
however, they must let prospective buyers know
their locations.

7
4. UNSOUGHT GOODS are
goods that the consumer does
not know about or knows
about but does not normally
think of buying. New products,
such as smoke detectors and
food processors, are unsought
goods until the consumer is
made aware of them through8
A BRAND is a name, term, sign,
symbol, or design, or a
combination of them,
intended to identify the goods
or services of one seller or
group of sellers and to
differentiate them from those
of competitors.

A trademark is a registered 9
Trademark:

A distinctive sign which identifies

the goods and services of one
company from those of another
®
Coca-Cola
registered
since 1887
A trademark helps consumers to
identify and choose between
products/services based on their
reputation and quality Nike
registered
since 1971

10
Distinctive (unique)

Not descriptive

Not similar or identical

11
Different types of trademark

Well-known mark

Apple, the Apple logo, iPhone are trade markes

of Apple Inc. registered in the U.S. & other
countries.
Apple Store is a service mark of Apple Inc.
Google and the Google Logo are registered
trademarks of Google Inc.

12
Different types of
trademarks:

Word e.g. DELICJUSZ,

Logo e.g.

Word/Logo e.g.

13
 ®
To have an exclusive right

Stop others from copying

Certificate of ownership

14
Many marketers have called packaging a fifth
P, along with price, product, place, and
promotion. Most marketers, however, treat
packaging and labeling as an element of product
strategy.
PACKAGING includes the activities of designing
and producing the container or wrapper for a
product.
The package might include up to three levels
of material. Thus, Old Spice After-Shave Lotion is
in a bottle (primary package) that is in a
cardboard box (secondary package) that is in a
corrugated box (shipping package) containing
six-dozen boxes of Old Spice.
15
Self-service.
Consumer affluence: Rising
consumer affluence means
consumers are willing to pay a
little more for the
convenience, appearance,
dependability, and prestige of
better packages.
Company and brand image 16
After the packaging is
designed, it must be tested.
Some of the tests include:
Engineering tests are
conducted to ensure that the
package stands up under
normal conditions.
Visual tests to ensure that the
script is legible and the colors
17
Labeling is a subset of packaging.
Labels perform several functions:
identifies the product or brand.
grade the product.
describe the product: who made it, where it
was made, when it was made, what it contains,
how it is to be used, and how to use it safely.
promotes the product through its attractive
graphics.
Labels eventually become outmoded and need
freshening up.
Legal considerations also need to be made in
developing packaging and labeling.

18
Identify

Grade

Describe

Promote

12-19
A firm’s product strategy must
take into account the fact that
products have a life cycle.
Products are introduced, grow,
mature, and decline.
Marketing executives need to
be aware of the life-cycle
concept because it can be a
valuable aid in developing 20
10-21
The Product Life Cycle (PLC)
varies according to product,
technology, and market.

Marketing executives need to

be aware of the life-cycle
concept because it can be a
valuable aid in developing
marketing strategies. 22
 Sales
Sales Low
Low sales
sales being
being at
at an
an awareness
awareness stage
stage

Costs
Costs High
High Production,
Production, Marketing
Marketing Costs
Costs

Profits
Profits Negative
Negative
Create
Create product
product awareness
awareness
Marketing
Marketing Objectives
Objectives and
and trial
trial
Product
Product Offer
Offer aa basic
basic product
product
Skimming
Skimming Pricing
Pricing (Charging
(Charging higher
higher price
price
Price
Price ifif inelastic
inelastic demand)
demand) or or Cost
Cost Plus
Plus Pricing
Pricing
Distribution
Distribution Build
Build selective
selective distribution
distribution

Advertising Build
Build product
product awareness
awareness among
among early
early
Advertising adopters and dealers
adopters and dealers

23
Growth
Growth Stage
Stage of
of the
the PLC
PLC

Sales
Sales Rapidly
Rapidly rising
rising sales
sales

Costs
Costs Average
Average cost
cost per
per customer
customer

Profits
Profits Rising
Rising profits
profits correlated
correlated with
with sales
sales

Marketing
Marketing Objectives
Objectives Maximize
Maximize market
market share
share
Offer
Offer product
product extensions,
extensions, service,
Product
Product warranty
service,
warranty
Skimming.
Skimming. OrOr Penetratation
Penetratation Pricing
Pricing ifif
Price
Price only
only competition
competition exists
exists
Distribution
Distribution Build
Build intensive
intensive distribution
distribution

Advertising Build
Build awareness
awareness and
and interest
interest in
in the
the
Advertising mass
mass market
market
24
Decline
Decline Stage
Stage of
of the
the PLC
PLC

Sales
Sales Declining
Declining sales
sales

Costs
Costs Low
Low cost
cost per
per customer
customer

Profits
Profits Declining
Declining profits
profits

Marketing
Marketing Objectives
Objectives Reduce
Reduce expenditure
expenditure and
and milk
milk the
the brand
brand

Product
Product Drop/Alter/Seek
Drop/Alter/Seeknew
newmarket
marketfor
forthe
theproduct
product

Price
Price Cut
Cut price
price (Penetration
(Penetration pricing)
pricing)
Go
Go selective:
selective: phase
phase out
out unprofitable
unprofitable
Distribution
Distribution outlets
outlets
Advertising
Advertising Reduce
Reduce to
to level
level needed
needed toto retain
retain
hard-core
hard-core loyal
loyal customers
customers
26
10-27
10-28
10-29