Products in Marketing Management

• A product drives all business activities, strategies, and customer interactions in marketing management.
• Product are tangible goods, intangible services and ideas that satisfy a need or want in a market.
• Effective customer demand, market differentiation, and long-term profitability are key to understanding a product
• Products can be physical goods, services, or a combination, depending on their purpose and market demands.
• Managing products involves decisions about product strategy, positioning, packaging, pricing, and promotion.

Types of Products in Marketing Management

• Products are classified by characteristics, usage, and customer buying behaviors.

Consumer Products

• Consumer products are goods or services purchased by individuals for personal consumption.
• Consumer products are categorized by purchase frequency, intensity, and consumer involvement.

Convenience Products

• Convenience products are bought frequently, immediately, and with minimal effort.
• They are low-cost, widely available, and require little thought or planning.
• Packaged food items, toiletries, newspapers, and cleaning products are examples.
• Convenience products rely on widespread distribution, low pricing, and frequent promotions.

Shopping Products

• Shopping products require more thought, comparison, and effort before purchase.
• These products are typically higher quality or higher price.
• Consumers need to compare features, price, and brand before deciding on these products.
• Electronics, furniture, clothing, and household appliances are examples
• Shopping products require differentiation and promotion based on features, quality, and customer benefits
• Retailers often stock a limited range to encourage comparison.

Specialty Products

• Specialty products are high-involvement products with unique, highly valued characteristics.
• These products are usually expensive, and consumers go out of their way to purchase them. Consumers perceive these products as having special features that make them stand out.
• Luxury cars, designer clothing, fine jewellery, high-end watches, and unique artworks are examples.
• Specialty products rely on exclusivity, premium pricing, and targeted promotions.

Unsought Products

• Unsought products are those consumers do not think about or know they need until a specific situation arises.
• These products typically involve high emotional involvement or urgency when purchased.
• Life insurance, funeral services, emergency repair services, and medical products are examples.
• Marketing unsought products requires heavy promotion and persuasive advertising with a focus on immediate purchase or crisis resolution.

Industrial Products

• These are goods or services purchased by businesses for production or operations, further classified by use and customization.

Materials and Parts

• Raw materials and component parts are used in the production of finished products.
• Examples of materials and parts include steel, timber, flour, and car parts like tires and batteries.
• Industrial marketers focus on bulk sales, quality consistency, and reliable delivery.

Capital Goods

• Capital goods are large-scale, durable goods used to produce other goods or services.
• Examples of capital goods include machinery, factory equipment, office buildings, and construction vehicles.
• Selling capital goods involves direct relationships with buyers, customization, and offering long-term support and maintenance.

Supplies and Services

• Supplies and services are essential for business functioning but are not part of the production process.
• Office supplies, cleaning services, maintenance tools, and business consulting are examples of supplies and service
• Industrial marketers ensure these products meet functional requirements and offer reliability.

Product Classifications by Durability and Tangibility

• Products are classified based on durability (how long they last) and tangibility (physical or intangible).

Durable Goods

• Durable goods are tangible products that have a long lifespan and provide long-term use.
• Examples include furniture, appliances, cars, and electronics.
• Durable goods require higher customer involvement, warranty provisions, and after-sales support.
• Marketing emphasizes product quality and long-term value.

Nondurable Goods

• Nondurable goods are tangible products that are consumed or used up quickly.
• Examples include food, beverages, cosmetics, cleaning supplies, and paper goods.
• Marketing focuses on high turnover rates, convenience, and widespread distribution with an emphasis on convenience and affordability.

Services (Intangible Products)

• Services are intangible products that cannot be touched, seen, or stored.
• Examples are legal services, medical care, education, entertainment, and financial services.
• Services require focus on customer experience, trust-building, quality service, and reputation.
• Focuses on excellent customer support, consistent quality, and creating value

Product Life Cycle

• Every product goes through a life cycle that influences marketing strategies from introduction to decline.

Introduction Stage

• A new product is introduced to the market, sales grow slowly, and the focus is on creating awareness and demand.
• Strategies include heavy promotion, building distribution channels, and educating consumers.

Growth Stage

• Sales increase rapidly as the product gains market acceptance.
• Competitors may enter the market.
• Companies focus on differentiating the product and expanding its market reach.

Maturity Stage

• Sales growth slows, and the market becomes saturated.
• Companies maintain market share through promotions, variations, and increasing customer loyalty.

Decline Stage

• Sales and profits decrease as consumer preferences change or newer alternatives emerge.
• Companies may discontinue the product, reduce prices, or innovate to revive interest.

Product Mix

• Representing the complete range of products or services that a company offers, helping businesses cater to diverse customer needs, optimize resource use, and position themselves competitively in the market.

Key Dimensions of Product Mix

• Product mix dimensions covers width, length, depth and consistency

Width

• Width refers to the number of different product lines a company offers.
• A wide product mix allows catering to varied customer needs and spreads business risk across multiple product categories.
• Coca-Cola has product lines including soft drinks, bottled water, fruit juices, energy drinks, and sports drinks.

Length

• Length is the total number of products the company sells across all its product lines.
• It reflects the overall scale of the business and helps measure the variety offered to customers.
• For example, a bakery chain with bread, cakes, pastries, and cookies product lines with the figures (5, 10, 8, 12), has a total mix length of 35.

Depth

• Depth is the number of variations available within a single product line, eg size, flavour, colour, design, price, or any other differentiator.
• A deeper product mix allows for customization and appeals to niche markets or individual preferences.
• Nike's Shoe Line offers running shoes, basketball shoes, casual shoes, size ranges, colours, and customizations.

Consistency

• Consistency describes how closely related product lines are in terms of use, production, target markets, or distribution.
• High consistency can streamline operations and strengthen brand identity.
• Low consistency can diversify risk and attract different markets.
• Dove is a high-consistency product mix, Dove focuses on personal care products like soap, shampoo, and lotion.
• Amazon is a low-consistency product mix with everything from electronics to groceries.

Real-World Examples of Product Mix

Apple Inc

• Width is product lines iPhones, iPads, MacBooks, Apple Watches, and services (iCloud, Apple Music).
• Length is the total number of products across these lines: multiple models of each (e.g., iPhone 15, 15 Pro, etc.).
• Depth is the IPhone having variances in storage capacity, colors, and performance features
• Consistency is the high consistency as all products are within the technology ecosystem.

Unilever

• Width is Food and beverages, home care, personal care, and beauty products.
• Length is hundreds of individual products like Dove soaps, Lipton teas, and Surf detergents.
• Depth: For Lipton, they offer iced tea, green tea, black tea, and herbal blends in various flavours.
• Consistency is moderate, as product lines serve different purposes but are largely consumer-focused.

Strategic Importance of Product Mix

• Meeting diverse customer needs, risk diversification, enhanced market positioning, revenue maximization, and operational efficiency

Meeting Diverse Customer Needs

• A broader mix attracts more customers by catering to varied tastes and requirements, for example a clothing retailer offering casual wear, formal wear, sportswear, and accessories.

Risk Diversification

• Having a wide and diverse product mix reduces dependency on one product or market, for example if demand for soft drinks drops, Coca-Cola still has water and juice products.

Enhanced Market Positioning

• A comprehensive product mix strengthens the company's brand image as a one-stop solution for example Amazon's wide product mix positions it as the "everything store.".

Revenue Maximization

• Offering more products or variations increases cross-selling and upselling opportunities, for example a car manufacturer offering base, mid-tier, and luxury trims for the same model.

Operational Efficiency

• A consistent product mix simplifies manufacturing, marketing, and distribution processes, for example Toyota benefits from high consistency by using shared platforms for multiple car models.

Steps to Optimize a Product Mix

• Market analysis, performance metrics, innovation and development, strategic pricing, and effective communication.

Market Analysis

• Study customer needs and preferences to identify gaps in the product mix, for example adding gluten-free or vegan options in food products based on demand trends.

Performance Metrics

• Evaluate sales, profitability, and market share for each product and adjust the mix accordingly, for example discontinuing underperforming products to focus on best-sellers.

Innovation and Development

• Regularly introduce new products or improve existing ones to stay competitive, for example launching smart appliances to capitalize on the Internet of Things (IoT) trend.

Strategic Pricing

• Use the depth of the product mix to offer options at various price points, catering to different customer segments, for example budget, mid-range, and premium options for smartphones.

Effective Communication

• Highlight the variety and benefits of the product mix in marketing campaigns, for example showcasing different meal options in McDonald's advertising.

Product Modification

• Product modifications include quality, functional, style or design, technological, and environmental

Quality Modification

• Enhancing the product's durability, reliability, or overall quality, such as smartphone manufacturers improving battery life or camera performance.

Functional Modification

• Adding or improving product features to increase its usefulness or convenience for example automakers introducing advanced safety features like lane assist or adaptive cruise control.

Style or Design Modification

• Updating the aesthetic appeal of the product, such as packaging, colour, or overall appearance
• For example, Coca-Cola frequently redesigns its cans and bottles to stay fresh in consumers' minds.

Technological Modification

• This involves upgrading technology to enhance product performance, and for example laptops being updated with faster processors or larger storage capacities.

Environmental Modification

• Aligning products with sustainability or eco-friendly trends, for example brands adopting biodegradable packaging or producing electric vehicles.

Benefits of Product Modification

• Customer retention, Competitive Advantage, Extended Product Life Cycle, Increased Revenue

Challenges in Product Modification

• High development costs, risk of alienating existing customers, potential for failure if the modification does not meet expectations.

Product Elimination

• This is the process of discontinuing products that no longer perform well, aligns with business goals, or generates adequate profits.

Reasons for Product Elimination

• Declining sales consistent drop in demand means a product is no longer relevant, and high costs where products with low margins or high production and marketing costs may need elimination, and changing market trends.

Declining Sales

• Consistent drop in demand means a product is no longer relevant, for example discontinuation of DVD players as streaming services dominate.

High Costs

• Products with low margins or high production and marketing costs may need elimination, for example cutting unprofitable variants in a product line.

Changing Market Trends

• Consumer preferences and technology shifts may make certain products obsolete, for example phasing out non-smartphones in favor of smartphones.

Internal Resource Optimization

• Freeing up resources to focus on more profitable or promising products, for example a company reallocating funds from low-performing products to R&D for new innovations.

Negative Brand Impact

• Poorly performing products can tarnish a brand's reputation, for example automakers recalling and discontinuing faulty models.

Steps in Product Elimination

• Performance analysis, customer feedback, cost-benefit analysis, gradual phase-out, reallocation of resources

Performance Analysis

• Evaluate sales, profitability, and market relevance of the product.

Customer Feedback

• Understands why the product is underperforming and whether improvements could help.

Cost-Benefit Analysis

• Compare the potential benefits of retaining or modifying the product against its costs.

Gradual Phase-Out

• Inform customers and gradually reduce production to minimize disruptions.

Reallocation of Resources

• Shift focus to higher-performing or new products.

Benefits of Product Elimination

• Cost savings reduces wasteful spending on unprofitable products, and focus on core offerings allows the company to prioritize products that align with its goals; improved brand image eliminates products that may harm the company's reputation.

Challenges in Product Elimination

• Alienating loyal customers few customers may demand products that have very less market and so the company decides to eliminate it from the market, impact on existing inventory and supply chain, potential loss of market share in certain segments.

Product Modification Examples - Apple Inc

• Continuously updates its iPhone series with improved cameras, processors, and software features to stay relevant and competitive, and introduced the "Dynamic Island" feature in newer iPhones to enhance user interaction.

Product Elimination Examples - Apple Inc

• Phased out the iPod product line due to declining demand, as smartphones could perform the same functions and more.

Packing

• Packing is enclosing or protecting items for distribution, storage, sale, or ensure it remains intact, undamaged, and appealing to the customer

Packing Purpose

• Protection is the primary function, and convenience is design for easier use, retail and distribution; presentation is to attract attention by eye-catching designs and the packaging can convey important information like expiry dates and ingredients.

Information

• Packaging is a critical medium for conveying important information about the product Labels and printed materials provide details such as usage instructions, safety precautions, ingredients, nutritional information, expiration dates, and storage guidelines

Branding

• Packaging is a powerful tool for building and reinforcing brand identity with unique colours and signature designs; the packaging can signal sustainability and appeal to consumers that care about being eco-friendly.

Various Methods of Packing

• Shrink wrapping protects from dust or tampering and is common for food products, stretch and vacuum packing.

Shrink Wrapping

• Involves covering a product with a plastic film and then applying heat to shrink the film tightly around the product; this method provides a secure fit, protects the product from dust, moisture, and tampering, and is commonly used for food items, electronics, and multipacks like beverage cans or bottles

Stretch Wrapping

• Stretch wrapping uses elastic plastic film to wrap products, often on pallets, for stability during transportation; it's widely used in logistics and warehousing to secure bulk shipments and doesn't require heat, therefore making it cost-effective.

Vacuum Packing

• Involves removing air from the package and sealing it to create an airtight environment; is often used for perishable food items like meats, cheeses, and coffee, as it extends shelf life by preventing oxidation and microbial growth.

Blister Packing

• Blister packing uses a pre-formed plastic cavity (blister) sealed to a backing material, often cardboard or foil; is commonly used for small consumer goods like medicines, toys, and electronic components, this method provides visibility.

Bubble Wrapping

• Involves using plastic sheets with air-filled pockets to cushion and protect fragile or delicate items during shipping; its popular for electronics, glassware and breakable products due to the lightweight and shock-absorbing properties.

Carton Packing

• Utilizes cardboard boxes to encase products the boxes can be customized in size and strength to fit different items, also cartons are ecofriendly as they can be recycled.

Foam Packing

• Involves using materials like Styrofoam or moulded foam inserts to provide cushioning and insulation for products foam packing is common for shipping fragile electronics , medical devices, and glassware.

Liquid Filling and Sealing

• For liquid products such as beverages, detergents, or oils, filling machines are used to measure and dispense the liquid into bottles, cans, or pouches; these are then sealed with caps, lids, or heat-sealed closures to prevent leaks and contamination.

Palletizing

• consolidate multiple items or packages onto a pallet; this allows easier handling and transportation. Products are often stretch-wrapped or strapped onto the pallet to prevent shifting during transit. Palletizing is widely used in bulk logistics and supply chain operations.

Aseptic Packing

• Involves sterilizing both the product and its packaging material separately, then combining them in a sterile environment; used widely for food and beverages like milk, juices, and sauces, it lasts long with refrigeration.

Tin Can Packing

• a durable and tamper-resistant method, commonly used for canned foods, beverages, and aerosol products; the cans are airtight that protects it from air and contaminations.

Pouch Packing

• This packing is made pouches of flexible materials like plastic or foil are used for products ranging from snacks and beverages to personal care items. Pouch packing is lightweight, portable, and often resealable

Wooden Crating

• Wooden crates are used to package heavy-duty or oversized items such as machinery, furniture, or industrial equipment.

Developing New Products

• Developing new products is conceptualizing, designing, creating, and bringing a new product or service to market to meet customer needs, solve problems, or capitalize on opportunities by taking a strategic approach to innovation and what target the product.

Idea Generation

• Idea generation is the process of collecting ideas from market research, customer feedback, competitors, and internal brainstorming.

Idea Screening

• Idea screening is the process of evaluating and filtering ideas to identify viable concepts based on feasibility, market potential, and alignment with business objectives.

Concept Development and Testing

• Involves refining product concepts and testing them with target customers to gauge interest and gather feedback. Business Analysis - Involves estimating the potential profitability, costs, and overall market impact of the new product.

Business Analysis

• Business analysis is when you estimate the potential profitability, costs, and overall market impact of the new product.

Product Design and Development

• Here involves creating prototypes, refining features, and ensuring the product is functional, appealing, and ready for production.

Market Testing

• Market testing involves introducing the product to a limited audience to evaluate its reception and refine the marketing strategy.

Commercialization

• Commercialization is when you launch the product with a well-planned marketing campaign, distribution strategy, and sales support.

Post-Launch Review

• Post-launch review is monitoring customer feedback, sales performance, and market trends in order to optimize the product and address challenges.

Importance of New Product Development in Marketing Management

• Maintains a competitive advantage by adapting the industry the business is in, meets evolving customer needs and demands, it drives growth, by opening new market opportunities, it builds brand value, which demonstrates the commitment to customer satisfaction.

Market Research and Analysis

• Conduct details research to understand customer preferences, pain points and trends, analyse competitors to identify market gaps and opportunities, utilise tools like surveys and data analytics.

Customer Centric Innovation

• Involve customers in the ideation and testing stages to create solutions that address their needs, and use customer feedback from existing projects to guide development.

Leveraging Technology

• Invest in research and development to incorporate the latest technologies and innovations, and to use AI to enhance product functionality.

Open Innovation and Collaboration

• Partner with universities or other organizations to co-develop innovative products and collaborate with suppliers and distributors to leverage their expertise.

Incremental Innovation

• Improve existing products by adding new features or adapting to trends, offer new versions or upgrades to extend the product lifecycle.

Blue Ocean Strategy

• Focus on creating in a new market space, develop products that meet your unique value propositions.

Diversification

• Expand into new markets or industries with innovative products.

Cost Leadership

• Develop low-cost products to attract price-sensitive customers.

Sustainability and Social Responsibility

• Create environmentally friendly products to appeal to eco-conscious consumer, and incorporate renewable materials and practices in development.

Prototyping and Agile Development

• Use rapid prototyping to create and refine product objects, implement agile methodologies to adapt to market feedback during the development process. Test Marketing - Launch the product in a specific geographic area or to a select audience to test its reception.

Brand Extension

• Leverage an established brand to introduce new products in related categories.

Value Addition

• Bundle products or create services that complement the new product, focus on perceived value for customers.

Employee and Internal Innovation Programs

• Encourage employees to contribute ideas through innovative programs.