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roduct, as successful firms the world over are keenly aware, is a key element in the
market offering.This holds true whether the product is a television show (offered by
Arts & Entertainment Network), an Internet access service (offered by AT&T), a ham-
burger (offered by Wendy’s), a DVD player (offered by Sony), a sweater (offered by
Benetton), or a chocolate bar (offered by Nestlé). No matter where the product origi-
nates, no matter which market segment is being targeted, marketing-mix planning
begins with formulating an offering to meet customers’ needs or wants.
Previously, we looked at how companies develop, differentiate, and position
their products throughout the life cycle. Here, we examine the concept of product
and product-line decisions. We also explore basic brand decisions and key packaging
and labeling issues. Three elements—product, services, and price—must be meshed
into a competitively attractive offering if a company wants to perform well in the mar-
ketplace.
THE PRODUCT AND THE PRODUCT MIX
Aproductis anything that can be offered to a market to satisfy a want or need.
Products include physical goods, services, experiences, events, persons, places, properties, orga-
nizations, information,andideas.The customer will judge the offering by three basic
elements: product features and quality, services mix and quality, and price appropri-
ateness (Figure 4-1). As a result, marketers must carefully think through the level at
which they set each product’s features, benefits, and quality.
Product Levels
Marketers plan their market offering at five levels, as shown in Figure 4-2.^1 Each level
adds more customer value, and together the five levels constitute a customer value hier-
archy.The most fundamental level is the core benefit:the fundamental service or benefit
that the customer is really buying. A hotel guest is buying “rest and sleep”; the pur-
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Managing Product
Lines and Brands
We will address the following questions:
■What are the characteristics of products?
■How can a company build and manage its product mix and product lines?
■How can a company make better brand decisions?
■How can packaging and labeling be used as marketing tools?