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Chapter 16

RSM100Y1 Chapter Notes - Chapter 16: Brand Equity, Brand Loyalty, Business Analysis


Department
Rotman Commerce
Course Code
RSM100Y1
Professor
John Oesch
Chapter
16

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What is product?
Product features and benefits
Features: qualities-tangible and intangible-that a company builds into its
products
Value package: product marketed as a bundle of value-adding attributes,
including reasonable cost
Classifying goods and services
Classifying consumer products
Convenience goods/services: relatively inexpensive consumer goods or
services that are brought and used rapidly and regularly, causing
consumers to spend little time looking for them or comparing their
prices
Shopping goods/services: moderately expensive consumer goods or
services that are purchased infrequently, causing consumers to spend
some time comparing their prices
Specialty goods/services: very expensive consumer goods or services
that are purchased rarely, causing consumers to spend a great deal of
time locating the exact item desired.
Classifying industrial products
1. Expense items: relatively inexpensive industrial goods that are consumed
rapidly and regularly
2. Capital items: expensive, long-lasting industrial goods that are used in
producing other goods or services and have a long life.
3. Capital services: services for which long-term commitments are made.
Product mix: the group of products a company has available for sale
Product line: a group of similar products intended for a similar group of buyers
who will use them in a similar fashion.
Developing new products
The time frame of new product development
Product mortality rate
Speed to market
Speed to market: strategy of introducing new products to respond quickly to
customer and/or market changes
The seven-step development process
1. Product ideas
Service package: identification of the tangible and intangible features that
define the service
2. Screening
3. Concept testing
4. Business analysis
5. Prototype development
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6. Product testing and test marketing
7. Commercialization
Product life cycle (PLC): the concept that the profit-producing life of any product goes
through a cycle of introduction, growth, maturity (leveling off), and decline.
Stages in the product life cycle
1. Introduction
2. Growth
3. Maturity
4. Decline
Extending product life: an alternative to new products
Product extension: the process of marketing an existing, unmodified product
globally.
Product adaptation: the process of modifying a product to have greater appeal in
foreign markets.
Reintroduction: the process of reviving for new markets products that are
obsolete in older ones.
Identifying products
Branding products: the use of symbols to communicate the qualities of a
particular product made by a particular producer
Adding value through equity
Brand equity: degree of consumers loyalty to and awareness of a brand and
its resultant market share
Ebuiness and international branding
Types of brand names
1. National brands: products distributed by and carrying a name associated
with the manufacturer
2. Licensed brands: products for which the right to use a brand name, a
celebritys name, or some other well-known identification mark was sold
to another company to use on a product
3. Private brands: products promoted by and carrying a name associated
with the retailer or wholesaler, not the manufacturer.
Brand loyalty: customers’ recognition of, preference for, and insistence on
buying a product with a certain brand name.
Trademark: the exclusive legal right to use a brand name
Patents: exclusive legal right to use and license a manufactured item or
substance, manufacturing process, or object design
Copyright: exclusive ownership rights belonging to the creators of books,
articles, designs, illustrations, photos, films, and music.
Packaging products: physical container in which a product is sold, advertised, or
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