MKTG1001 Lecture Notes - Brand Equity, Liquid Oxygen, Sales Promotion
Marketing Learning Objectives Week 4.
LO1: Define Product, the three levels of a product and the main
classifications of products and services (p204-209).
A product is anything that can be offered to a market for attention, acquisition, us or consumption
that might satisfy a need or want. These can be more than tangible- they can be services, events,
persons or ideas.
Each level of product adds more customer value.
The most basic is core customer value- which addresses ‘what the customer is really buying’.
When designing products, marketers must define the core, problem-solving benefits or
services that consumers seek.
The second level is the transformation of core benefits into an actual product, with brand
names, features, design, packaging and quality level.
Lastly, product planners must build an augmented product around the core benefits and
actual product by offering additional consumer services and benefits- this includes after-sale
service, warranty, product support, delivery and credit.
So marketers identify the core customer values, design actual product and then augment it
to provide the best customer experience.
There are two broad classes of products and services based on the types of customers that use
them:
CONSUMER PRODUCTS:
Purchased for personal consumption.
These include convenience products, shopping products, speciality products and
unsought products.
Convenience products are bought frequently, immediately and with
minimum comparison or buying effort. This could be laundry detergent etc.
Shopping products are less frequently purchased and are compared on
suitability, quality, price and style. This involves more time and effort on the
customers’ part gathering information and making comparisons, ie. the
purchase of furniture, clothing or used cars.
Specialty products have unique characteristics or brand identification for
which significant groups of buyers are willing to make special purchase
effort. Such as specific brands of cars, designer clothing, and the services of
specialists.
Unsought products are ones the consumer did not know about or doesn’t
usually think of buying. This involves most major new innovations until the
consumer becomes aware of them through advertising. This includes pre-
planned funeral services and blood donations.
INDUSTRIAL PRODUCTS:
Purchased for further processing or for use in business conduction.
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Materials and parts include raw materials and manufactured materials and parts,
such as farm products, natural products, component materials and component
parts. These are usually sold directly to industrial users, and price and service are the
main marketing factors.
Capital items are industrial products that aid buyer’s production or operation, such
as installations and accessory equipment. It consists of major purchases such as
buildings, fixed equipment, portable tools and equipment and even office
equipment.
Supplies and services include operating supplies and repair and maintenance items,
such as paint, lubricants, coal, paper and pencils. These are convenience products of
the industrial field as they are usually purchased with minimum effort or
comparison. This can also include maintenance and repair services such as window
cleaning and commuter repair, and business advisory services such as legal or
manage consulting.
A final category can be classified for other marketable entities, such as experiences, organisations,
persons, places and ideas.
Organisation marketing consists of activities undertaken to create, maintain or change
attitudes and behaviours of target consumers towards an organisation.
Person marketing consists of activities undertaken to “ “ towards certain people- used by
politicians, entertainers, of professionals.
Place marketing involves activities undertaken to “ “ towards particular places.
Event and experiences marketing is often linked to other market offering.
Social marketing aims to improve the behaviour and well-being of the society, such as the
quit smoking campaigns etc.
LO2: Describe the main decisions companies make regarding
products, product lines, product mixes and services (p209-217).
The main decisions made can be categorised in three levels: individual product decisions, product
line decisions and product mix decisions.
Individual product decisions
These include decisions based on product and service attributes, branding, packaging, labelling and
product support services.
Product and service attributes include quality, features, style and design.
Branding identifies the maker or seller of a product or service, and is very important in
purchasing. With Coca-Cola, their brand is important, with users unable to identify what
tastes better between Pepsi and Coca-Cola when they are unlabelled, but choosing 75% to
Coca-Cola when the brands were identified, as opposed to 25% for Pepsi.
Packaging involves design and production of container and wrapper for product that attract
attention, describe the product and make the sale.
Labelling is regulated by state and federal laws, identifies the product or brand, and
describes the product.
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Document Summary
Lo1: define product, the three levels of a product and the main classifications of products and services (p204-209). A product is anything that can be offered to a market for attention, acquisition, us or consumption that might satisfy a need or want. These can be more than tangible- they can be services, events, persons or ideas. Each level of product adds more customer value. The most basic is core customer value- which addresses what the customer is really buying". When designing products, marketers must define the core, problem-solving benefits or services that consumers seek. The second level is the transformation of core benefits into an actual product, with brand names, features, design, packaging and quality level. Lastly, product planners must build an augmented product around the core benefits and actual product by offering additional consumer services and benefits- this includes after-sale service, warranty, product support, delivery and credit.
