Class 12 Marketing Product Notes and Important Questions

Class 12 Product Notes (Marketing)

Chapter 2 Product NEB Class 12 | Marketing (Mar. 308) | Unit 2 Allotted Teaching Hours: 20 Hours Topics: 2.

Marketing | Class 12 Ch. 2

Chapter 2 Product NEB Class 12 | Marketing (Mar. 308) | Unit 2 Allotted Teaching Hours: 20 Hours Topics: 2.1 - 2.6 Why this chapter matters: Product is the first and most important element of the marketing mix (4 Ps). Without a well-designed product, pricing, distribution and promotion have nothing to work with. This is the longest unit (20 hrs) because it lays the foundation for the rest of the course - branding, packaging and labeling decisions you learn here are used again and again in later chapters. 2.1 Meaning and Definition of Product A product is not only a physical object. In marketing, a product is anything that can be offered to a market to satisfy a need or want - it can be a physical good, a service, an idea, a place, a person, an organisation, or even an experience. Philip Kotler: "A product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need." In short, a customer does not buy a 'thing' - the customer buys the benefit / satisfaction that the thing provides. For example, a student does not buy a pen for its plastic body; he/she buys the ability to write. Product may include: - Physical goods - book, mobile phone, shoes. - Services - banking, education, transport. - Experiences and events - a concert, a tour package. - Persons - image of a celebrity, political candidate. - Places - a tourist destination, an industrial zone.

Marketing | Class 12 Ch. 2

- Organisations - the image/reputation of a company or NGO. - Ideas - family planning, road safety campaigns. 2.2 Levels of Product Every product can be looked at on five levels. Each level adds more customer value on top of the previous one. This model (given by Philip Kotler) is called the 'Five Product Levels' or 'Product Value Hierarchy'. - 1. Core Benefit - the fundamental need the customer is really buying. (A hotel guest is really buying 'rest and sleep'.) - 2. Generic / Basic Product - the core benefit turned into a basic product. (A hotel room with a bed, bathroom, towels.) - 3. Expected Product - the set of attributes and conditions buyers normally expect. (Clean bed, fresh towels, working lamps, reasonable quiet.) - 4. Augmented Product - extra features/services that exceed customer expectation and help differentiate the product. (Free Wi-Fi, breakfast, TV, quick check-in.) - 5. Potential Product - all the possible new features, benefits or transformations the product may undergo in the future. (Smart-room control, AI concierge.) Exam tip: Remember the order using: Core -> Generic -> Expected -> Augmented -> Potential. Competition today happens mostly at the Augmented level, since the core, generic and expected levels are usually the same across competing brands. 2.3 Classification of Products Products are broadly classified on the basis of who uses them and how. The two main categories are Consumer Products and Industrial Products. A. Consumer Products Consumer products are goods and services bought by the final/ultimate consumer for personal, family or household use (not for resale). Based on shopping habits, they are of four types:

Marketing | Class 12 Ch. 2

- 1. Convenience Goods - bought frequently, immediately, with minimum shopping effort. e.g. salt, soap, newspaper. Sub-types: staples (routine purchase), impulse goods (bought without planning, e.g. chocolate at the counter), emergency goods (bought urgently, e.g. umbrella during sudden rain). - 2. Shopping Goods - bought less frequently; customer compares suitability, quality, price and style before buying. e.g. furniture, clothing, electronic appliances. Sub-types: homogeneous (similar quality, compared mainly on price - e.g. refrigerators) and heterogeneous (differ in features/style - e.g. furniture, garments). - 3. Specialty Goods - goods with unique characteristics or brand identification for which a group of buyers is willing to make a special buying effort. e.g. luxury cars, designer clothes, branded watches. - 4. Unsought Goods - goods the consumer does not know about, or knows about but does not normally think of buying. e.g. life insurance, blood donation, encyclopaedias, new inventions - these usually need aggressive advertising and personal selling. B. Industrial Products Industrial products are goods bought by individuals or organisations for further processing, for use in running a business, or for resale to other businesses. They are classified into three groups: - 1. Materials and Parts - become part of the buyer's finished product. Includes raw materials (farm products like cotton, wheat; natural products like timber, iron ore) and manufactured materials/parts (component materials like yarn, cement; component parts like small motors, tyres). - 2. Capital Items - long-lasting goods that help in production/operations. Includes installations (factory buildings, heavy machinery) and equipment (portable factory tools, office equipment like computers, desks). - 3. Supplies and Business Services - short-lived items and services that help run the business but do not become part of the finished product. Operating supplies (lubricants, coal, stationery); maintenance and repair items (paint, nails, brooms); business services (maintenance/repair services, legal and advisory services, advertising services). Key difference: Consumer goods satisfy a personal need directly; industrial goods satisfy a need indirectly - they are used to produce other goods or run a business.

Marketing | Class 12 Ch. 2

2.4 Branding A. Meaning of Brand and Trademark A brand is a name, term, sign, symbol, design, or a combination of these, used to identify the goods or services of a seller and to differentiate them from those of competitors. A trademark is a brand (or part of a brand) that is legally registered and protected, giving the owner exclusive rights to use it. - Brand name - the part that can be spoken (e.g. 'Wai Wai', 'Coca-Cola'). - Brand mark - the symbol/design that can be recognised but not spoken (a logo, colour, or lettering style). - Trademark - a brand/brand-mark that is legally protected under law. B. Importance of Branding - Helps identify and differentiate the product from competitors' products. - Gives an assurance of consistent quality to the customer. - Provides legal protection for unique product features through trademark registration. - Builds customer loyalty and repeat purchase. - Makes advertising and promotion more effective (easy to recall a brand name). - Allows the firm to charge a premium price due to brand equity/goodwill. - Makes it easier to introduce new products under an already trusted brand name. C. Types of Brands - Manufacturer / National Brand - owned and promoted by the producer (e.g. Samsung, CG). - Private / Distributor Brand - owned by a wholesaler or retailer (store-label products). - Individual Brand - a separate brand name is given to each product of the firm. - Family Brand - one common brand name is used for a whole line/range of products of the firm. - Generic Brand - no brand name is used at all; the product is sold simply by its category name, usually at a lower price.

Marketing | Class 12 Ch. 2

D. Reasons for Not Branding Some Products - Branding is costly - development, packaging, legal registration and advertising all add cost. - Branding requires the firm to maintain consistent quality at all times, which is not always possible for small producers. - Some products (e.g. raw agricultural produce, coal, sand) are standardised commodities that are hard to differentiate through a brand. - Small/local manufacturers may lack the resources to build and defend a brand. E. Qualities of a Good Brand Name - Easy to pronounce, recognise and remember (short and simple). - Should suggest something about the product's benefit or quality. - Should be distinctive and different from competitors' brand names. - Should be capable of legal registration and protection. - Should be translatable / acceptable in other languages and markets, with no negative meaning. - Should be adaptable to new products that may be added to the product line later. 2.5 Packaging A. Meaning and Features Packaging refers to all the activities of designing and producing the container or wrapper for a product. It is often called the 'silent salesman' because it attracts attention and communicates with the customer even without a salesperson present. - Protective - shields the product from damage, dust, moisture and spoilage. - Promotional - attractive design, colour and shape help sell the product. - Informative - carries information about the product (ingredients, usage, expiry). - Convenient - easy to carry, store, open, use and dispose of. B. Functions of Packaging

Marketing | Class 12 Ch. 2

- Protection of the product from damage during handling, storage and transport. - Containment - holds liquids, powders or granular products together. - Apportionment - converts bulk production into a size that suits individual customer needs. - Unitization - groups smaller units into a larger pack for easier handling/transport. - Convenience - makes the product easy to use, carry and store. - Communication and promotion - displays brand, price, usage instructions and attracts buyers. C. Levels of Packaging - Primary package - the immediate container that directly holds the product (e.g. the tube holding toothpaste). - Secondary package - extra protective/promotional layer around the primary package, usually discarded before the product is used (e.g. the toothpaste's outer carton box). - Shipping / Transport package - the bulk packaging needed for storage, identification and transport (e.g. a corrugated carton holding 50 tubes for shipment). D. Types of Package - Consumer package - designed for the final household consumer, small size, attractive. - Industrial / Bulk package - larger, simpler, meant for institutional/industrial buyers. - Family package - a common design/theme used across a firm's whole product line, so packs look related on the shelf. - Reuse package - designed so the container can be reused for another purpose after the original product is finished (e.g. a jar). - Multiple package - several units of the same product are packed together (e.g. a 6-pack of soft drinks). E. Importance of Packaging - Protects the product and extends shelf life. - Acts as a silent salesman - attracts attention on the shelf and influences buying decisions. - Helps differentiate the product from competitors. - Provides convenience in carrying, storing and using the product.

Marketing | Class 12 Ch. 2

- Builds and reinforces brand image. - Helps meet legal requirements (e.g. mandatory information disclosure). - Growing importance of eco-friendly / biodegradable packaging due to environmental concerns. 2.6 Labeling A. Meaning A label is a tag, wrapper, seal or printed piece of information that is attached to a product or its package. Labeling is the process of designing and attaching such information to the product. B. Types of Labels - Brand label - simply identifies the brand name/mark on the product or package. - Descriptive label - gives objective information about the product: who made it, where and when it was made, its contents, how to use it, and safety precautions. - Grade label - identifies the judged quality of the product by a letter, number or word (e.g. 'Grade A', 'Premium', 'Extra Virgin'). C. Functions of Labeling - Identifies the product or brand. - Grades the product's quality level. - Describes the product - manufacturer, ingredients/contents, net weight, manufacturing and expiry date, usage and safety instructions. - Promotes the product through attractive graphics and design. - Helps consumers make an informed choice and meets legal/consumer-protection requirements. Note the link: Branding, Packaging and Labeling work together - the brand identifies 'who' made the product, the package protects and presents it, and the label communicates the details. All three build the customer's trust and buying decision.

Marketing | Class 12 Ch. 2

Quick Revision - Key Points to Remember - Product = bundle of benefits, not just a physical object. - 5 Levels: Core -> Generic -> Expected -> Augmented -> Potential. - Consumer goods: Convenience, Shopping, Specialty, Unsought (4 types). - Industrial goods: Materials & Parts, Capital Items, Supplies & Business Services (3 groups). - Brand identifies; Trademark legally protects; Packaging is the 'silent salesman'. - 3 levels of packaging: Primary, Secondary, Shipping. - 3 types of label: Brand, Descriptive, Grade. Possible Exam Questions Short Answer Questions - Define product. Explain the different levels of a product with examples. - Distinguish between consumer goods and industrial goods. - What is branding? State its importance. - Explain the functions of packaging. - What is labeling? Mention its types. Long Answer Questions - Explain the classification of consumer products with suitable examples. - Describe the types of brands and the qualities of a good brand name. - Explain the meaning, levels and importance of packaging in modern marketing. End of Chapter 2 (20 Hours) | Next -> Chapter 3: Pricing (12 Hours)