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Chapter 10

Study Notes for Chapter 10


Department
Management (MGM)
Course Code
MGMA01H3
Professor
Ingrid L.Stefanovic
Chapter
10

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Chapter 10: A Definition of Product
INTRODUCTION
Total Product
- a bundle of physical, service and symbolic characteristics that are designed to
satisfy consumers wants
Warranty
- a guarantee to the buyer that the supplier will replace a defective product or refund
its purchase price during a specified period of time. This increases consumer
purchase confidence and stimulates demand
THE TOTAL PRODUCT CONCEPT
Physical or Functional Characteristics of a Good or Service
1. Brand
2. Product Image
3. Warranty and Service
4. Package and Label
BRAND MANAGEMENT
Brands, Brand Names and Trademarks
Brand
- a name, term, sign, symbol, design or a combination of these that is used to identify
and differentiate the products of a firm from competition.
Brand Name
- words, letters or symbols that make up a name used to identify and distinguish the
firm's offerings from those of its competitors
Trademark
- a brand that has been given legal protection and has been granted solely to its
owner
- for consumers, brands usually facilitate repeat purchases of satisfactory products.
- the brand assures a uniform quality and identifies the producing firm
What Constitutes a Good Brand Name
- good brand names are easy to pronounce, recognize and remember
- gives the buyer the right connotation
The Brand Name should be Legally Protectable
Generic Name
- a brand name over which the original owner lost exclusive claim because all
offerings in the same class of products have become generally known by the brand
name (ie. Jello)
Companies try to prevent their brand names from becoming a name generally
used by
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1. legal action in cases of infringement
2. create new words
Brand Equity
- represents the value customers and stock markets place on the sum of the history
customers have had with a brand (ie. high quality = high brand equity)
4 Components to Brand Equity
1. Brand Awareness
- a measure of how well and widely a brand is known
2. Perceived Quality
- customers assessment of the quality of the product carrying that brand
3. Brand Associations
- the connections customers make between the brand and other aspects of their
experience and understanding (ie. Nike associated with high performance and
individualism)
4. Brand Loyalty
- the level of commitment a customer has to a particular brand
3 Brand Loyalty Categories:
1. Brand Familiarity
- first stage of brand loyalty, when a firm makes products familiar to consumers
through advertising, free samples or coupons offering discounts.
2. Brand Preference
- second stage of brand loyalty, when consumers, based on past experience, will
choose a product rather than one of its competitors if it is available.
3. Brand Insistence
- third stage of brand loyalty, where consumers will accept no other alternative and
will search extensively for the product!
BUILDING STRONG BRANDS
4 Factors
1. Organization structure and processes must be supportive of the brand: clear on who
is responsible for the brand and management must track brand performance
2. Intentional brand building programs in the form of integrated communication plans
3. Brand Identity and Position must be clearly understood in the marketplace
4. Brand Architecture must be consistent with the overall brand strategy
Brand Architecture
- relationship between a company products, brands and sub-brands
Family Brand
- brand name used for several related products
-the effect of promotions is spread over each of the products
-supermarkets are more agreeable to stocking new family-brand products
-less money spent on introducing the new product to consumers
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