Marketing management - Class 4

What is the offering spectrum?

What a company has to offer:

• Pure tangible good e.g. Toothbrush

• A tangible good with accompanying services e.g. Car

• A hybrid offering e.g. Restaurant

• A major service with accompanying minor goods and services e.g. Air travel

• A pure service e.g. Daycare

How can you differentiate your product?

1. Core functionanilty - The primary purpose a product serves is called its core functionality.

2. Features - Product features refer to the specific attributes or functionalities that enhance the product's core use .

3. Durability - Durability reflects the ability of a product to withstand pressure, or damage. Long -lasting products provide better value for money.

4. Performance - Measures how well a product delivers on its promises .

5. Conformance - Conformance refers to a product's

adherence to specific standards or regulations , which ensures safety, efficiency, and quality.

6. Reliability - Reliability is the likelihood of a product

consistently performing well over time without failure .

7. Customization - Customization allows customers to

modify products according to their preferences . This adds a personal touch to the product, increasing its appeal.

8. Form - Form refers to the physical appearance of the product, including its shape, size, and design.

9. Style - Style focuses on the product’s aesthetic appeal and how it looks . Products with distinct and attractive styles stand out in the marketplace.

What is the differentiation of your product?

Identify which areas of product differentiation apply to your product and use them to enhance customer satisfaction and brand loyalty.

• To capture customer attention

• To stand out from competitors

• To focus on one or more of the differentiating aspects.

What is product design and why is it important?

Design: The totality of features that affect how a product looks, feels, and functions to a consumer (functional and aesthetic benefits). Importance =

• Make products more appealing, easy to use, etc.

• Brand recognition

• Creating a higher demand for the product

• Emotional impact - Increase desire

• Creating an experience

What is packaging and what is its purpose?

Packaging: Includes all the activities of designing and producing the container for a product. What is its purpose?=

• Protection during transportation

• Information to customers

• Branding and marketing

What are the 3 layers of packaging?

1. Primary package - The product's immediate container. It contains and protects the product, helps with usage.

2. Secondary package - The next layer used to group primary packages together. It holds multiple units of a product for easier handling, typically used in retail stores.

3. Shipping package - The outermost packaging used for handling, storing, and shipping products. It protects products during transportation to warehouses or end customer. Ensure that products arrive intact.

What is the role of packaging in marketing?

Brand identity - Defining a brand’s visual identity and conveying the company’s message.

Sustainability - Increasing consumer demand for eco-friendly packaging, such as recyclable or biodegradable.

What are the goals of packaging?

• Identify the brand

• Convey descriptive and persuasive information

• Facilitate product transportation and protection

• Assist at-home storage

• Aid product consumption

What are the product label goals?

• Identification (name, contact, etc.)

• Grading (level A/B/C, class, etc)

• Description (origin, ingredients, etc.)

• Promotion of the product through attractive graphics

• Legal demands

What are guarantees and warranties?

To ensure if a product fails to function as promised or as a customer expects, the company will provide some type of compensation to the buyer.

What is the difference between guarantees and warranties?

Warranty: Repair or replacement, free or paid.

Guarantee: Repair, prelacement and return for refund. Focus on free

What are the different components of a product portfolio

1. Product portfolio = All products offered by a company, including a variety of product categories / product lines

2. Product line & sub -product lines = A group of related products marketed under a single brand and sold by the same company

3. Product portfolio width = The number of different (sub-)products lines the company carries

4. Product portfolio length = The total number of products in the portfolio

5. Product line length = Product Line length refers to the number of products/brands that come under a single product category/line.

6. Product line depth = Product line depth refers to the number of variants or versions offered by each product/brand in the product line

How do you evaluate a company’s product portfolio?

The BCG (Boston Consulting Group) Matrix is a tool used to evaluate a company's

product portfolio based on two factors:

- Market Growth: how fast the market is growing

- Relative Market Share: how much market share a product holds compared to competitors

• Purpose: Helps companies decide where to invest, which products to grow, maintain, or

divest.

What are the 4 categories of the BCG Matrix?

Stars (high growth, high share):Products that are leaders in fast-growing markets . They generate a lot of revenue but require significant investment to maintain their position.

• Strategy - Invest heavily to sustain their market leadership as they are the future "Cash Cows."

Cash cows (low growth, high share):Products that dominate a slow-growing market . They generate consistent revenue with little need for investment .

• Strategy - Milk the profits from Cash Cows and use the revenue to invest in Stars and Question Marks.

Question marks (high growth, low share):Products in growing markets but with low market share . They have potential to become Stars, but they require careful investment decisions.

• Strategy - Evaluate whether to invest in these products to improve their market share or discontinue them if the outlook isn't promising.

Dogs (low growth, low share): Products with low market share in a slow-growing market . They usually generate little profit and may not justify further investment.

• Strategy - Consider divesting or discontinuing these products, as they are not profitable and hold little future promise.

What is market share?

How big is my company in comparison to other companies.

What are the differences between physical and digital products?

• Production costs

• Delivery costs

• Storage

• Stock

• Scalability

What is the difference between product and service?

Service: An act or performance one party can offer to another that essentially is intangible and does not result in the ownership of anything.

Product: A tangible item that a customer owns and keeps.

What are the characteristics of a service?

Intangible: Services cannot be seen, tasted, felt, heard, or smelled before they are bought e.g. Plastic surgery

Inseperable: Services are typically produced and consumed simultaneously e.g. Haircut-barber

Variable: Because the quality of services depends on who provides them, when and where, and to whom, services are highly variable e.g. Performance of an artist

Perishable: Services can not be stored, so their perishability can be a problem when demand fluctuates e.g. Missed appointment – doctor.

How do you tackle insecurities that come with service characteristics?

Intangibility: Try to give physical evidence (place, people, equipment, communication material, price)

Inseparability: Is not scalable. Scale through adding more service providers, working faster and work with larger groups (group therapy)

Variability: Will the customer always get the same end result? Good hiring and training, monitor satisfaction, standardisation and offer guarantees.

Perishability: Cannot be stored and never be recovered. Differential pricing, reservation systems and nonpeak demand.

How do you manage service quality?

1. Reliability: The ability to perform the promised service depandably and accurately.

2. Responsiveness: The willingness to help customers and provide prompt service.

3. Assurance: The knowledge of employees and their ability to convey trust and confidence.

4. Empathy: Providing caring, individualized attention to customers.

5. Tangibles: The appearance of physical facilities, equipment, personnel, and communication materials

How do you differentiate services

1. Ordering ease

2. Speed and timing delivery and returns

3. Installation

4. Training

5. Maintenance and repair

6. Customer consulting

How do you achieve service excellence?

1. External: Preparing, pricing, distributing, promoting the service

2. Internal: Training/Motivating employees

3. Interactive: Srving the client