Chapter 11: Product, branding, and packaging decisions. When you finish this chapter, you should: Describe the components of a product, identify the types of consumer products, explain the difference between a product mix’s breadth and a product line’s depth, identify the advantages that brands provide firms and consumers,...
chapter eleven product, branding, and packaging decisions Copyright © 2015 McGrawHill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGrawHill Education LEARNING OBJECTIVES LO 11-1 Describe the components of a product LO 11-2 Identify the types of consumer products LO 11-3 Explain the difference between a product mix’s breadth and a product line’s depth LO 11-4 Identify the advantages that brands provide firms and consumers LO 11-5 Explain the various components of brand equity LO 11-6 Determine the various types of branding strategies used by firms LO 11-7 Distinguish between brand extension and line extension LO 11-8 Indicate the advantages of a product’s packaging and labeling strategy 112 Complexity of Products Michael Blann/Digital Vision/Getty Images 113 Types of Products Customers show such a strong preference that they will expend considerable effort to search Consumer is willing to spend minimum effort to evaluate prior to purchase Wedding Gowns College Apparel Antiques Can goods Shampoo Candy Shoes Appliances Cellphones Fire extinguishers Dictionary Medical supplies Consumers will spend a fair amount of time comparing alternatives Consumers either not normally think of buying or not know about 114 check yourself • • Explain the three components of a product What are the four types of consumer products? 115 Product Mix and Product Line Decisions Product Lines Toaster Pastries and Wholesome Portable Ready-to-Eat Cereal Breakfast Snacks Kellogg’s Corn Flakes Nutri-Grain All-Bran Special K Apple Jacks Kashi Cocoa Krispies Pop-Tarts Frosted Mini-Wheats Bear Naked Mueslix Kellogg’s Raisin Bran Froot Loops Kashi Special K Rice Krispies Cookies and Crackers Cheez-It Keebler Townhouse Club Famous Amos Fudge Shoppe Murray Natural, Organic, and Frozen Eggo Morningstar Farms Kashi Source: Kellogg’s 2010 annual report, http://annualreport2010.kelloggcompany.com/innovation.htm 116 Product Mix and Product Line Decisions Breadth • Number of product lines Depth • Number of categories within a product line Courtesy Pepsi Cola Company 117 check yourself • • • What is the difference between product line breadth versus depth? Why change product line breadth? Why change product line depth? 118 Branding Courtesy Mercedes-Benz USA, LLC; Merkley & Partners/New York A brand can use: Name, logo symbols, characters, slogans, jingles and even distinctive packages Oscar Mayer Wiener 1965 Commercial (One of America's Best Ads) 119 McGraw-Hill Companies, Inc What Makes a Brand? Character s Logos and symbols URLs Slogans www.eBay.com ©M Hruby Brand name Branding Jingles/Sounds “Law & Order” 1110 check yourself • • • • What are the differences among manufacturer and private-label brands? What is co-branding? What is the difference between brand extension and line extension? What is brand repositioning? 1122 Packaging • What other packaging you as a consumer find useful? ©M Hruby 1123 Product Labeling C Sherburne/PhotoLink/Getty Images ©The McGraw-Hill Companies, Inc/Elite Images 1124 Glossary A brand association reflects the mental links that consumers make between a brand and its key product attributes, such as a logo, slogan, or famous personality Return to slide 1125 Glossary Brand dilution occurs when the brand extension adversely affects consumer perceptions about the attributes the core brand is believed to hold Return to slide 1126 Glossary Brand equity is the set of assets and liabilities linked to a brand that add to or subtract from the value provided by the product or service Return to slide 1127 Glossary A brand extension refers to the use of the same brand name for new products being introduced to the same or new markets Return to slide 1128 Glossary Brand licensing is a contractual agreement between firms, whereby one firm allows another to use its brand name, logo, symbols, and/or characters in exchange for a negotiated fee Return to slide 1129 Glossary Brand loyalty occurs when a consumer buys the same brand’s product or service repeatedly over time rather than buy from multiple suppliers within the same category Return to slide 1130 Glossary Brand repositioning or rebranding refers to a strategy in which marketers change a brand’s focus to target new markets or realign the brand’s core emphasis with changing market preferences Return to slide 1131 Glossary Co-branding is the practice of marketing two or more brands together, on the same package or promotion Return to slide 1132 Glossary Perceived value of a brand is the relationship between a product or service’s benefits and its cost Return to slide 1133 Glossary Product assortment or product mix is the complete set of all products offered by a firm Return to slide 1134 Glossary Product lines are groups of associated items, such as items that consumers use together or think of as part of a group of similar products Return to slide 1135 Glossary Product mix or product assortment is the complete set of all products offered by a firm Return to slide 1136 ... manufacturer and private-label brands? What is co-branding? What is the difference between brand extension and line extension? What is brand repositioning? 1122 Packaging • What other packaging you as... 115 Product Mix? ?and? ? Product Line? ?Decisions Product Lines Toaster Pastries and Wholesome Portable Ready-to-Eat Cereal Breakfast Snacks Kellogg’s Corn Flakes Nutri-Grain All-Bran Special K Apple... advantages that brands provide firms and consumers LO 1 1-5 Explain the various components of brand equity LO 1 1-6 Determine the various types of branding strategies used by firms LO 1 1-7 Distinguish