1. Chapter 12 : SETTING PRODUCT STRATEGY Prof. Joseph de Ungria AGSB – Marketing Management by : Cynthia Maandal 03-06-10

2. What is a Product? A product- anything that can be offered to a market to satisfy a want or need - including physical goods, services, experiences, events, persons, places, properties, organizations, information, and ideas.

3. Products :

4. Figure 12.1 Components of the Market Offering Value-based prices Attractiveness of the market offering Product features and quality Services mix and quality

5. Figure 12.2 Five Product Levels

6. Product Classification Schemes Durability Tangibility Use

7. Durability and Tangibility Nondurable goods Services Durable goods

8. Product Differentiation Product form Features Customization Performance Conformance Durability Reliability Repairability Style

9. Consumer Goods Classification Convenience Shopping Specialty Unsought

10. Service Differentiation Ordering ease Delivery Installation Customer training Customer consulting Maintenance and repair Returns

11. Design Differentiation Is the totality of features that affect how a product looks , feels and functions, in terms of customer requirements.

12. Maintenance and Repair Describes the service program for helping customers keep purchased in good working order

13. Product Systems and Mixes Product system Product mix Product assortment Depth Length Width Consistency

14. Product-Mix Width and Product-Line Length, Depth and Consistency for Proctor& Gamble Products

15. Line Stretching Down-Market Stretch Up-Market Stretch Two-Way Stretch

16. Two Stretch - Holiday Inn Crowne Plaza – upscale Holiday Inn – Traditional Holiday Inn Express – Budget Holiday Inn Select – Business Oriented Holiday Inn – Suites and Rooms

17. Product- Mix Pricing Product Line Pricing Optional Feature Pricing Two-Part Pricing Captive Product Pricing By-product Pricing Product Bundling Pricing

18. Product Line Pricing Valid until March 31, 2010 (24-hour response) Weekday (Monday to Thursday) Room Types Rates per Room per Night Superior Room (Single/Double) without Breakfast US$ 117 nett Superior Room (Triple) without Breakfast US$ 150 nett Superior Room (Single) with Breakfast US$ 125 nett Superior Room (Double) with Breakfast US$ 128 nett Superior Room (Triple) with Breakfast US$ 196 nett Weekend (Friday to Sunday) Room Types Rates per Room per Night Inclusions:• Room accommodation• Taxes• Service charge

19. What is the Packaging ? -sometimes called the fifth P, is all the activities of designing and producing the container for a product.

20. Factors Contributing to the Emphasis on Packaging Self-service Consumer affluence Company/brand image Innovation opportunity

21. Packaging Objectives Identify the brand Convey descriptive and persuasive information Facilitate product transportation and protection Assist at-home storage Aid product consumption

22. Functions of Labels Identifies Grades Describes Promotes

23. Warranties and Guarantees - are formal statements of expected product performance by the manufacturer