A product is anything that can be marketed to satisfy a want or need, including physical goods, services, experiences, events, persons, places, properties, organizations, information, and ideas. These can include people, experiences, events, goods, services, places, organization, ideas and information. In this blog, I’ll give an over view of the steps needed to successfully strategically place a product into a marketplace.
In marketing, product strategy begins by formulating an offering to meet the needs and wants of the target consumer. The customer will judge the offerings by the product features and quality, services mix and quality and price.
There are five product levels, with the first being the core benefit, which is a service or benefit the customer is really buying. Then there is the basic product, which is when marketers turn core benefit into a basic product at this level. Next, there are the expected products that are attributes and conditions buyers expect when they purchase this product. Competition takes place at this level in developing countries. Then there are the augmented products, which are attributes and conditions exceed customer expectations. Competition takes place at this level in developed countries. Finally there is potential product, which are various augmentations that could be incorporated in the future. This is where companies search for new ways to satisfy customers and distinguish their offering.
Product Line Analysis
In conducting product line analysis managers must examine each product in terms of how it contributes to overall sales and profits. Products that are responsible for a large percentage of sales and profits must be carefully monitored and protected. Products that deliver on a small percentage may be candidates for being dropped, unless strong growth potential is possible. A product line manager must examine how the line is positioned against competitors. One tool that managers can employ is a product map, which shows competitors’ items in relation to firm’s items. This also allows for identifying market segments.
Product and Brand Relationships
The product hierarchy stretches from basic needs to particular items that satisfy those needs. A product system is a group of diverse but related items that function in a compatible manner. A product mix is the set of all products and items a particular seller offers for sale. Product line analysis when the companies develop a basic platform and modules of a product line that can be added to meet different customer requirements and lower production costs. Managers need to know the sales and profits of each item in their line to determine which items to build, maintain, harvest, or divest, as well as each product line’s market profile.
Product line length is influenced by company objectives and tends to lengthen over time. In product-mix pricing, the firm searches for a set of prices that maximizes profits on the total mix. In Co-branding, two or more well-known brands are combined into a joint product or marketed together in some fashion. Understanding these definitions will help in truly understanding the product at hand in relation with brands.
Packaging and Labeling
The package is the customers first encounter with the product and a good package draws the customer in, encouraging product choice. Packaging also influences customers when they go to open and use the product at home. Labeling objectives include: identity, grade, description and promotion. Packaging objectives include: brand identification, persuasion and protection.
In order to successfully strategically place a product in the market, a marketer must have a clear understanding of the product level, product line analysis, product brand relationships and packaging and labeling. Although this is something we do on a day-to-day basis, it’s important to not forget these important steps in setting brand strategy.