Session 06 (c)

The 4 Ps of Marketing: Product Product & Service Differentiation

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Agenda
8 dimensions of product differentiation Core-Expected-Augmented-Potential products/services

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Reading

Marketing Management (Kotler, Keller, Koshy & Jha)

Chapter 11: Crafting the Brand Positioning
Section on Differentiation Strategies

Marketing Success Through Differentiation of Anything

by Theodore Levitt
Harvard Business Review, Jan-Feb80

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

What is Product Differentiation?

Process of (creating and) communicating a products differences (vis--vis competitors products as well as firms other products) to a chosen target segment Key: Differences must be valued by prospective customers

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Differentiation Kotlers View

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Girish Ketkar

Session 06 (c)

Differentiation Kotlers View

Product Differentiation Service Differentiation Personnel Differentiation

Channel Differentiation

Differentiation

Image Differentiation

Source: Marketing Management: A South Asian Perspective Philip Kotler, et al

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Product Differentiation 8 Dimensions

Form

Style

Features

Reparability

Product Differentiation

Performance Quality

Reliability

Conformance Quality

Durability
Girish Ketkar B2B Marketing BIMM Pune 2011-13 (Sem 1) Session 06 (c)

Product Differentiation 8 Dimensions

Form
Size, shape or physical structure of a product

Features
Characteristics that supplement basic function of a product

Performance quality
Level at which a products primary characteristics operate

Conformance quality
Degree to which all product units are identical and meet the promised specifications

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Product Differentiation 8 Dimensions

Durability
Products expected operating life under natural or stressful conditions

Reliability
Probability that a product will not malfunction or fail within a specified time period

Reparability
Ease of fixing a product when it malfunctions or fails

Style
Products look and feel
B2B Marketing BIMM Pune 2011-13 (Sem 1) Session 06 (c)

Girish Ketkar

Service Differentiation
Ordering Ease

Maintenance and Repair Service Differentiation Customer Consulting

Delivery

Installation

Customer Training
Girish Ketkar B2B Marketing BIMM Pune 2011-13 (Sem 1) Session 06 (c)

Personnel Differentiation
Competence Courtesy Credibility Reliability Responsiveness Communication

(skills, knowledge)

(friendliness, respect)
(trustworthiness) (accuracy, consistency) (quick response to queries/problems) (clarity, understanding the customer)

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Channel Differentiation
Coverage Expertise Performance

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Image Differentiation

Arising from company or brand image Difference between Identity and Image
Identity
Way a company aims to identify or position itself or its product

Image
Way the public perceives the company or its product

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Differentiation Levitts View

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Girish Ketkar

Session 06 (c)

Differentiation Levitts View

When the generic product is undifferentiated, the offered product makes the difference in getting customers and the delivered product in keeping them.

Theodore Levitt
Source: Marketing Success Through Differentiation of Anything Theodore Levitt, HBR Jan-Feb80

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Differentiation Levitts View

Potential product Augmented product Expected product Generic product Core need; Core benefits
B2B Marketing BIMM Pune 2011-13 (Sem 1)

Girish Ketkar

Session 06 (c)

Differentiation Levitts View

Generic product
The basic product that fulfills core need

Expected product
Generic product + Customers minimal purchase conditions
Delivery Terms Support efforts New ideas
B2B Marketing BIMM Pune 2011-13 (Sem 1) Session 06 (c)

Girish Ketkar

Differentiation Levitts View

Augmented product
Product that exceeds customers expectations Some key considerations
Each augmentation adds cost Will customers always prefer augmented products?
Trade-off between augmented benefits and price premium Competition may offer stripped-down version of augmented product at a much lower price

Augmented product soon becomes expected product!

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Differentiation Levitts View

Potential product
Futuristic view of all augmentations and transformations of the product, in order to acquire and retain customers

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Food for Thought

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Girish Ketkar

Session 06 (c)

10

Elephant and the Blind Men

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

Food for Thought

Elephant and the Blind Wise Men

Porter Barney Kotler Levitt

How do you compare, contrast and reconcile their views?

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

11

What We Covered Today

What is product differentiation? Kotlers view

Differentiation
Product
8 dimensions of product differentiation

Girish Ketkar

Service Personnel Image Channel

B2B Marketing BIMM Pune 2011-13 (Sem 1) Session 06 (c)

What We Covered Today

(contd.)

Levitts view
Offered product; Delivered product Product: Generic, Expected, Augmented, Potential

Girish Ketkar

B2B Marketing BIMM Pune 2011-13 (Sem 1)

Session 06 (c)

12