Part 3 Product

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Part 3 Product Brands, Packaging, and Other
Product Features
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Brands

• A brand is a name/or mark intended to identify
  the product of one seller or group of sellers and
  to differentiate the product from competing
  products
• A brand name consists of words, letters, and/or
  numbers that can be vocalized
• A brand mark is the part of the brand that
  appears in the form of a symbol, design, or
  distinctive color or lettering
• A trademark is a brand that has been adopted by a
  seller and given legal protection

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Brands
Reasons for Branding - Customers view

• Brands make it easy to identify goods or services
• Brands aid shoppers in moving quickly through a
  supermarket, discount outlet, or other retail
  store and in making purchase decisions
• Brands help assure customers that they will get
  consistent quality when they reorder

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Brands
Reasons for Branding - Sellers view

• Brands can be promoted
• Brands are easily recognized when displayed in a
  store or included in advertising
• Branding reduces price comparisons (because
  brands are another factor to be considered in
  comparing different products, branding reduces
  the likelihood of purchase decisions that are
  based solely on price)
• The reputation of a brand also influences
  customer loyalty

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Brands
Reasons for Not Branding

• Two responsibilities come with brand ownership
• Promoting the brand and
• Maintaining a consistent quality of output
• ? Many firms do not brand their products because
  they are unable or unwilling to assume these
  responsibilities

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Brands
Selecting a Good Brand Name
A brand name should have as many of the following
five characteristics as possible

• Suggest something about the product, particularly
  its benefits and use
• Be easy to pronounce, spell, and remember
• Be distinctive
• Be adaptable to additions to the product line
• Be capable of registration and legal protection

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Branding Strategies
Branding within a Product Mix
At least three different strategies are used by
firms that sell more than one product

• A separate name for each product
• The company name combined with a product name
• The company name alone

• Using the company name for branding purposes
  (family branding) makes it simpler and less
  expensive to introduce new, related products to a
  line
• Branding with the company name places a greater
  burden on the firm to maintain consistent quality
  among all products - one bad item can reflect
  unfavorably, even disastrously, on all other
  products carrying the same brand

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Branding Strategies
Branding for Market Saturation

• A multi-brand strategy can be employed to
  increase firms total sales in a market
• Firms have more than one brand of essentially the
  same product, aimed either at the same target
  market or at distinct target markets

Cobranding

• Cobranding or dual branding occurs when two
  separate companies or two divisions within the
  same company agree to place both of their
  respective brands on a particular product or
  enterprise
• This form of cooperation may ring up greater
  combined sales than if they were in separate
  locations
• But This strategy can lead to an overexposure of
  a brand name and to the risk of damaging a
  brands reputation

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Brand Equity

• Brand equity is the value a brand adds to a
  product
• If substantial brand equity can be achieved, the
  company that owns the brand can benefit in
  several ways
• The brand itself can become an edge over
  competition (differential advantage)
• Because it is expensive and time consuming to
  build brand equity, it creates a barrier for
  companies that want to enter the market with a
  similar product
• The widespread recognition and favorable
  attitudes surrounding a brand with substantial
  brand equity can facilitate international
  expansion
• Brand equity can help a product survive changes
  in the operating environment, such as a business
  crisis or a shift in consumer tastes

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Trademark Licensing

• Products with considerable brand equity have
  strong potential for trademark licensing
• Under a licensing agreement, the owner of a
  trademark grants permission (a license) to other
  firms to use its brand name and brand name on
  their products
• Owners of well-known brands are interested in
  licensing their trademarks for various reasons
• Profit
• Promotional benefit
• The advantages for the licensee are
• Improvement of the likelihood of new-product
  success
• Reduction of marketing costs

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Packaging
Purposes and Importance of Packaging

• Protect the product on its way to the customer
• Protect the product after it is purchased
• Help persuade middleman to accept the product
• Help persuade consumers to buy the product

• Historically, packaging was intended primarily to
  provide protection. Today, packaging is a major
  factor in gaining distribution and customers
• Ultimately, a package may become a products
  differential advantage, or at least a significant
  part of it

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Packaging
Packaging Strategies

• Packaging the Product Line Family Packaging
  uses either highly similar packages for all
  products or packages with a common and clearly
  noticeable feature
• Multiple Packaging Placing several units of the
  same product in one container
• Changing the Package Firms need to monitor - and
  consider - continuing developments, such as new
  packaging materials, uncommon shapes, innovative
  closures, and other new features
• Packaging is in the public eye today because of
  environmental issues