Marketing Exam II Ch 11

• Introduction: Promote awareness & gain product trial
• Growth: Differentiate brand from competition
• Maturity: Maintain brand loyalty
• Decline: Deletion/harvesting

• 1. Product Strategy
• 2. Distribution Strategy
• 3. Promotion Strategy
• & 4. Pricing Strategy

• Introduction: Limited number of models; frequent product modifications
• Growth: Expanded number of products; frequent product modifications
• Maturity: Large number of models
• Decline: Elimination of unprofitable models and brands

• Introduction: Distribution usually limited (depending on product); intensive efforts and high margins often needed to attract wholesalers and retailers
• Growth: Expand number of dealers; intensive efforts to establish long-term relationships with wholesalers and retailers
• Maturity: Extensive number of dealers; margins declining; intensive effort to retain distributors and shelf space
• Decline: Unprofitable outlets phased out

• Introduction: Develop product awareness; stimulate primary demand; intensive personal selling to distributors needed; sampling and couponing for consumers
• Growth: Stimulate selective demand; aggressive brand advertising
• Maturity: Stimulate selective demand; aggressive brand advertising; heavy promotion to retain dealers and customers
• Decline: Most, if not all, promotion phased out

• Introduction: Usually high to recover development costs (Primary demand; Becomes selective demand when competitors enter market)
• Growth: Prices begin to fall toward end of growth stage as a result of competitive pressure (selective demand)
• Maturity: Prices continue to fall; shakeout begins
• Decline: Prices stabilize at relatively low level; possible small price increase if competition is negligible

• Primary Demand: The desire for the product class rather than a specific brand, as there are few competitors with the same product
• Selective Demand: When there is ample competition, the company desires to advertise in hope of creating the consumer's preference for their specific brand

• 1. Multi-Product Branding Strategy
• 2. Multi-Branding Strategy
• 3. Private Branding Strategy
• 4. Mixed Branding Strategy
• 5. Generic Branding Strategy

• Advantages:
• - Promotion of one item promotes the firm's other products
• - Facilitates acceptance of new products by retailer and consumer
• - Efficiency of advertising dollars

• Disadvantages:
• - Poor performance of one item may negatively impact others in a line
• - Dilute image of product line

eg. Sunbeam(Sb) makes Sb Irons, Sb Toasters, & Sb Crockware

• Advantages:
• - Each brand is unique to each market
• - No risk that product failure will affect others in line
• Disadvantages:
• - No advertising/promotion efficiency
• - Scattering of resources over several brands instead of building a few brands to highly profitable levels.
• eg. Anheuser-Busch makes: Budweiser, Busch, Michelob, Wurtburger, & Hofbrau

When a company manufactures products but sells them under the brand name of a wholesaler or retailer

eg. Sears has both Kenmore appliances and Craftsman Tools

• When a firm markets products under its own name(s) and that of a reseller because the segment attracted to the reseller is different from its own market
• eg. Michelin makes Michelin tires and Sears Tires
• Chip Company makes its own brand and Jimmy Johns Chips

• Dog food
• Peanut Butter
• Green Beans
• Paper Towels
• Aspirin
• Cola

• Using the same brand name to enter a new market segment within its product class;
• Worry of Cannibalization = How would the market change/be effected with the introduction of this product?
• Eg. Cheerios - Honey Nut Cheerios - Frosted Cheerios

• Using the same brand name to enter a new market segment within its product class
• eg. Ralph Lauren Clothes then introduces RL paint (signifying quality)

• Combining a family name with a new brand name
• eg. Ford + Taurus
• + Mustang
• + GTO

• Using two manufacturers's names on a product
• eg. Blue Bell ice cream with Hershey Kisses!

Brand Personality: A set of human characteristics associated with a brand name; Brand Personality creates expectations about performance, benefits, and key characteristics

The added value a given brand name gives to a product beyond the functional benefits provided

• eg. Cadbury Schweppes acquires Hires and Crush soda lines from P&G for $220 million
• - $20 million physical assets
• - $200 million "Brand Value"

• A strategy we can utilize to prolong product's time in maturity --> There is no change in the actual product
• Sales Vol. = (# of brand users) x (Usage rate per user)

• Expand # of Brand users:
• - Convert non-users of category
• - Enter new market segments
• - Win competitor's customers
• - Repositioning (placing brand name in consumers minds)
• Usage Strategies:
• - Encourage more frequent use (drink coke in the morning)
• - More usage per occasion (Shampoo twice)
• - New and more varied uses for product

Change the actual product/its characteristics associated with that brand name

• Strategies:
• - Product Quality (NEW AND IMPROVED FORMULA!!)
• - Feature Improvement (It now does this!)
• - Style Improvement (Product aesthetics)