PRODUCT CLASSIFICATION

Non durable like

Convenience fresh food
Services like
goods salon/ theatre

impulsive Staple goods like coffee

essentials
Emergency goods

Shopping goods

Specialty goods
 Product and Service
Classification System
• Consumer products
• Durables
• Non DurablesE.g. Fresh food
• Services
• E.g. Haircut, theatre
• Convenience goods - little effort, relatively
inexpensive, purchased frequently.
• Impulsive (spur of movement)(e.g. Ice cream)
• Staple goods (essentials) purchased regularly like coffee,
milk, shampoos
• Emergency goods( infrequent and purchased at short notice)
• like caps during match, flags during election.
• FMCG
• Shopping goods – carry higher risk especially of product
failure)
• e.g. white goods, furniture
• Speciality goods - extensive search for niche products
• e.g. Jewellery, wedding clothes
• B2B/Industrial goods
• Capital goods (machinery)
• Accessories –
• (smaller capital items like hand tools, lath)
• Raw materials
• (cotton, water/yeast for brewing)
• Subassemblies/components/parts: already
manufactured but not finished goods.
• E.g. Denim fabric, condensers for
refrigerator, microchips for nokia
• Suppliers: minor items such as floppy, pens.
 Branding
• A brand is designed to enable
customers to identify products or
services which promise specific
benefits.
• A brand is a name, term, sign, symbol,
or design, or a combination of these,
that identifies the maker or seller of a
product or service.
 Advantages
• Advantages to buyers:
– Product identification
– Product quality

• Advantages to sellers:
– Basis for product’s quality story
– Provides legal protection
– Helps to segment markets
– Price premium
•  
 Brand equity

Brand Image

Brand
Identity

Brand
e.g. logo personality name e.g.
cool (characterist upmark
color ics) et
s
The way packagin
brand looks g

The way in which

market perceives
brand
The financial
value of brand
 Brand view
Brand personality : A brand can have
same traits as person like:
fun (Disney)
sincerity (BATA)
Sophistication (Sony),
Dependability (LIC)
Safety(Volvo)
ruggedness (jeep/bullet)
reliable (Nokia)
 Cont……..
• Brand identity relates the brand to
the world whereas brand image is
audience perception for the brand.
• Brand equity is financial value of the
brand.
 NAMES AND LOGOS
• Brand name is very important and plays
important role in distinguishing brand. It may
communicate function like Good Knight,
Boost, Fair and lovely, Aqua guard, walkman
• Sometimes acronyms are used as Madras
rubber factory, Anand milk union ltd
• Along with names logos are used for symbolic
identity. Flags, mascots, pictures etc
•
 Brand types
Corporate umbrella All products use Cadbury, godrej,
brands corporate name bajaj,sony, samsung

Family umbrella Organisation uses HLL’s kissan, lakme,

brands* different name for its brooke bond or NDDB’s
products Amul and Dhara

Individual brands Each brand has its own HUL- lux, rin ,surf,
brand name hamam
Own label(private) Products bear the Globus/ bigbazaar
retailer’s name

* Family branding means same name for a particular product

line
 Branding strategies
• Co-branding: when two companies brand
name appear together
• e.g. Intel inside, bankassurance
• Multiple branding: when different products
of same company are introduced within
same category
• e.g. surf/wheel closeup/ pepsodent
• Companies also introduces product with
same brand name (if brand is strong) :
• Brand extension: using brand name on
products in new category
• e.g. Dettol soaps, maggi ketchup
• Line extension: using the brand name
on products within the same category
• e.g. surf ultra Colgate gel, Colgate total
• Brand stretching: using
name in different markets
• From music industry to
airline etc
Competitive position
 Services Marketing
• Services
– Account for 70%of India gross
domestic product.
– Service industries include business
organizations, government, and
private not-for-profit organizations.
 What is a Service?
• A form of product that consists of
activities, benefits, or satisfactions
offered for sale that are essentially
intangible and do not result in the
ownership of anything.
– Examples: banking, hotel, airline, retail,
tax preparation, home repairs, educational
establishments, consultants, hairdresser,
doctors, stockbrokers, trainers
 The Product-Service
Continuum

College
Sugar Restaurant
Education

Pure Tangible Pure Service

Good
Nature and Characteristics of a
Service
Stages in PLC
 PLC
• This model has its own set of supporters
and opponents
• Like human beings product also go
through various phases. the only
difference is time at particular stage is not
predictable and also unlike human beings
is manageable
• At every stage product requires different
marketing, production, financing etc ,
strategies.
 PLC
Characterist Introduction Growth Maturity Decline
ics
Sales Low Rising Peak Declines
Profits Negative Rising High Decline
Customers Innovator Early Middle Laggards
adopters majority
Competitors Few Growing Stable Decline
Cost/custome High Average low Low
r
Marketing Crete product Maximize Maximize Reduce
objective awareness market share profit/defend expenditure/
and trial market share milk the
brand
Product Basic Extensions/w Modification Phase out
arranty
 Product development
• It doesn’t means new invention always. In
markets modification in products is very common
by companies. Hence even change in color of
package could be called as development.
• Why????
• Defending market share
• Appealing to different segment
• To maintain leadership(apple)
• Better use of resources
• Vulnerable to changes in technology taste etc
 Types of new product
• Innovative
• E.g. ipod
• Replacement
• E.g. DVD v/s CD,Alto V/s 800
• Variant
• E.g. Addition in range of co’s product.
may be temporary
• Me-too product: Uses costly research done
by others
• Relaunched product: Basic product is
same but total product offering changes
 Some examples
• IDAM( integrated design and manufacturing)
team of mahindra , with more than 120
members from different departments,worked
on testing, design manufacturing supplier
development, marketing, to create a product
for indian consumers with name scorpio
• Wafer chocolate BYTES from cadbury was
idea of company’s driver.
 Some examples
• National Innovation Foundation supported by
Dept. of Science and Technology, GOI is
nurturing and supporting grass –roots level
innovations in India since 2000. Ideas are from
consumers who face challenges in day to day
life come up with innovative product. Some
are motor-cycle driven sprayer, walking stick
with light etc.
What are new products????
Stages in the new-product
process
Forces fighting new idea
I have It wont work We ‘ve tried Isn’t right It cant be
great idea here before time done

It will cost Let’s

Its not the We’ve
much discuss at
way we do done all next
things without it meeting
Marketing information and methods used in the
new-product process
 Why do new products fail?

• One study estimated that as many as 80% of new

• consumer packaged products failed.
• Only about 40% of new consumer products are
• around 5 years after introduction
• WHY????????????????????????
• Overestimated market
• Poor design
• Incorrect positioning
• Error in pricing
• Poor marketing
• Cost overrun
• Competition