Product Features and Benefits

A product has multiple layers: core, augmented, and symbolic. These three layers can help a small business owner understand the product features and benefits that will best deliver value to current and prospective customers. These layers also provide the bases for differentiating and positioning the product. The product layers refer to both products and services and business-to-consumer (B2C) or business-to-business (B2B) customers.

The core layerThe nuts and bolts of a product, its physical anatomy, and its basic features. is the nuts and bolts of a product, its physical anatomy, and its basic features. It is also the basic benefit or problem solution that B2C or B2B customers are looking for. Someone buying an airline ticket, for example, is buying transportation.Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 226. Someone buying an ice cream cone is buying a delicious and fun treat. The core layer is also where considerations of qualityOverall product quality, reliability, and the extent to which a product or a service meets consumers’ needs. begin. Quality “refers to overall product quality, reliability, and the extent to which [the product or the service] meets consumers’ needs,” and the perception of quality has the greatest impact on customer satisfaction.Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 117. Decisions about design, manufacturing, preparation, ingredients, service delivery, component parts, and process materials all reflect a business’s philosophy about quality. The augmented layerWhere additional value is added via things such as packaging, promotion, warranties, guarantees, brand name, design, financing opportunities where appropriate, prompt and on-time service, and additional services that may enhance a product. is where additional value is added via things such as packaging, promotion, warranties, guarantees, brand name, design, financing opportunities where appropriate, prompt and on-time service, and additional services that may enhance a product. The augmented layer for Southwest Airlines is its well-known brand name, its packaging and promotion as a “fun” flying experience, and its “bags fly free” policy. The ice cream cone that is purchased in an old-fashioned ice cream parlor will likely be considered of greater value to many customers than the ice cream cone purchased at a Dairy Queen. It is this layer where many marketing mistakes are made because opportunities are missed. The symbolic layerThe meaning of a product to a consumer—its emotional and psychological connections. captures the meaning of a product to a consumer—its emotional and psychological connections. There are many loyal customers of Southwest Airlines because they really enjoy flying with them. It is inexpensive, convenient, and fun. The old-fashioned ice cream parlor will engender nostalgia and create powerful emotional ties. The most serious marketing errors are made when the symbolic product layer is either ignored or not understood. The power of symbolism should never be underestimated.

Every small business should look at its products within the context of the product layers. It is the creativity and imagination of the small business owner with the product layers that can set a business apart. They provide an excellent basis for dissecting an existing product to see where opportunities may have been missed, features could be added or changed, and features or enhancements could be explained more effectively in promotional activities. The product layers should also be used to develop new products that the business plans to introduce.

Product Mix

All small businesses have a product mix, the selection of products or services that is offered to the marketplace. With respect to the product mix for small companies, a company will usually start out with a limited product mix. However, over time, a company may want to differentiate products or acquire new ones to enter new markets. A company can also sell existing products to new markets by coming up with new uses for its products.Rick Suttle, “What Is a Product Mix?,” Chron.com, accessed December 1, 2011, smallbusiness.chron.com/product-mix-639.html. No matter the approach, the product mix needs to be created so that it is responsive to the needs, wants, and desires of the small business’s target market.

For small businesses engaged in e-marketing, product selection is a key element for online success. Part of the challenge is deciding which products to market online because some products sell better online than others.Jan Zimmerman, Web Marketing for Dummies, 2nd ed. (Hoboken, NJ: Wiley, 2009), 101. If a business has a brick-and-mortar presence, a decision must be made whether all the inventory or only part of it will be sold online. Items that sell well online change over time, so it is important to keep up to date on the changes.Jan Zimmerman, Web Marketing for Dummies, 2nd ed. (Hoboken, NJ: Wiley, 2009), 101. A second decision to be made is the number of items in the catalog (i.e., the number of items you will sell). Given intense online competition and shoppers’ desires for good selections, there needs to be a critical mass of products and choices—unless a company is lucky enough to have a very narrow niche with high demand. If a company has only one or two products to sell, the situation should be evaluated to determine whether selling online will be profitable.Jan Zimmerman, Web Marketing for Dummies, 2nd ed. (Hoboken, NJ: Wiley, 2009), 101–2.

Product Design

In his book, Re-imagine! Business Excellence in a Disruptive Age,Tom Peters, Re-imagine! Business Excellence in a Disruptive Age (London: Dorling Kindersley Limited, 2003), 132–46. Tom Peters devotes two chapters to the importance of design to business success. He says that design is “the principal reason for emotional attachment (or detachment) relative to a product service or experience”—and he quotes Apple’s CEO, Steve Jobs, in saying that design is the “fundamental soul of a man-made creation.”Tom Peters, Re-imagine! Business Excellence in a Disruptive Age (London: Dorling Kindersley Limited, 2003), 132–146, as cited in Bob Lamons, “Strong Image Design Creates Passion for Firm, Its Products,” Marketing News, April 15, 2005, 7. This is true whether the product comes from a big business or a small business.

Product designAesthetic properties such as color, shape, texture, and entire form plus a consideration of ergonomics, technology, and usability as well as touch, taste, smell, sight, and sound. involves aesthetic properties such as color, shape, texture, and entire form, but it also includes a consideration of function, ergonomics, technology, and usabilityDana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 242; Dominic Donaldson, “The Importance of Good Product Design,” Artipot, December 8, 2008, accessed December 1, 2011, www.artipot.com/articles/246078/the -importance-of-good-product-design.htm. as well as touch, taste, smell, sight, and sound. The pulling together of these things, as appropriate to the specific product or service being designed, should result in a design that matches customer expectations. “Design represents a basic, intrinsic value in all products and services.”Ted Mininni, “Design: The New Corporate Marketing Strategy,” MarketingProfs, November 5, 2005, accessed December 1, 2011, www.marketingprofs.com/articles/2005/1670/design-the-new-corporate-marketing-strategy.

Design offers a powerful way to differentiate and position a company’s products and services, often giving company a competitive edge.Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 325. Improved profit margins from increased sales and increased market share are often the result. It is essential to get the visual design of a product right for the market you are appealing to. It can make the difference between selling a product—or not.Dominic Donaldson, “The Importance of Good Product Design,” Artipot, December 8, 2008, accessed December 1, 2011, www.artipot.com/articles/246078/the -importance-of-good-product-design.htm.

Design is particularly important in making and marketing retail services, apparel, packaged goods, and durable equipment. The designer must figure out how much to invest in form, feature development, performance, conformance, durability, reliability, repairability, and style. To the company, a well-designed product is one that is easy to manufacture and distribute. To the customer, a well-designed product is one that is pleasant to look at and easy to open, install, use, repair, and dispose of. The designer must take all these factors into account.

The arguments for good design are particularly compelling for smaller consumer products companies and start-ups that do not have big advertising dollars.Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 325.

Quirky.com is a small business that has taken product design to a whole new level: collaboration. First seen as a “bold but ultimately wild-eyed idea,”Cliff Kuang, “Product-Design Startup Quirky Gets $6 Million in VC Funding,” Fast Company, April 7, 2010, accessed December 1, 2011, www.fastcompany.com/1609737/product-design-startup-quirky-gets-6-million-in-vc-funding. Quirky recently secured $6 million in venture financing. Check out how they operate in Note 7.42 "Video Clip 7.5". A company like this could be very helpful to a small business that is looking to introduce a new product.

Design issues also apply to services. Some of the design issues for services that are delivered in a store (e.g., dry cleaning, repair, and restaurant) are the same as for any retail store: the design of the physical space, the appearance of the personnel, the helpfulness of the personnel, the ease of ordering, and the quality of service delivery. For services that are performed at a customer’s home or at a business site, the design issues include timeliness; the appearance and helpfulness of personnel; the quality of installation, service, and repair; and the ease of ordering the service. The special characteristics of services (i.e., intangibilityA service cannot be seen, smelled, heard, tasted, or touched prior to purchase., perishabilityA service cannot be stored like a physical good., inseparabilityA service is performed and consumed at the same time., and variabilityEach time a service is performed, it will be performed in a different way., as defined in Figure 7.4 "The Characteristics of Services") present design challenges that are different from those faced by physical products.

Whether a small business is offering a product, a service, or a combination of the two to either the B2C or B2B marketplace, there is no question that excellent product design is a gateway to business success.

Packaging Design

The design of the product or the service package is another decision component of the product. PackagingAll the activities of designing and producing the container for a product. can be defined as “all the activities of designing and producing the container for a product.”Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 239. Packages “engage us consciously and unconsciously. They are physical structures but at the same time they are very much about illusion. They appeal to our emotions as well as to our reason.”Randall Frost, “Packaging Your Brand’s Personality,” Brandchannel, October 3, 2005, accessed December 1, 2011, www.brandchannel.com/features_effect.asp?pf_id =283. Thus the package communicates both emotional and functional benefits to the buyer, and it can be a powerful means of product differentiation. A well-designed package can build brand equity and drive sales.Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 339. A poorly designed package can turn the customer off and can lead to wrap rage—the anger and frustration that results from not being able to readily access a product, which often leads to injuries (see Note 7.48 "Video Clip 7.6"). Although difficult-to-open packaging may be seen as necessary by the manufacturers and retailers, it does not do much for a positive customer experience.

Brand

A brandA name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or the services of one seller or a group of sellers and to differentiate them from those of competitors. is defined by the American Marketing Association as “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors…A brand may identify one item, a family of items, or all items of that seller. If used for the firm as a whole, the preferred term is trade name.”“Brand,” American Marketing Association, accessed December 1, 2011, www.marketingpower.com/_layouts/Dictionary.aspx?dLetter=B. A brand is a promise to the consumer that certain expectations will be met, a promise that—if broken—may result in the loss of that customer. A company’s brand is probably its most important asset.

Building a brand is an ongoing process for a small business because it wants a memorable identity. It is important for the business to constantly monitor its brand to ensure that it represents the core values and needs of its existing and potential customers.Miranda Brookins, “How to Brand a Business,” Chron.com, accessed December 1, 2011, smallbusiness.chron.com/brand-business-211.html. The brand needs to reach people on an emotional levelMarc Gobe, Emotional Branding: The New Paradigm for Connecting Brands to People (New York: Allworth Press, 2001), xv. because customers ultimately make decisions on an emotional level, not a logical level. For this reason, a small business should think in terms of tapping into as many senses as possible with its brand. “Almost our entire understanding of the world is experienced through our senses. Our senses are our link to memory and can tap right into emotion.”Martin Lindstrom, Brand Sense: Build Powerful Brands through Touch, Taste, Smell, Sight, and Sound (New York: Free Press, 2005), 10. Scenting the air of a store with a fresh fragrance could be a powerful contributor to the store’s brand.

Whether a small business wants to keep its brand (but may be monitoring it) or is looking to rebrandChanging the brand. (changing the brand), there are four fundamental qualities of great brands that should be kept in mind:Adapted from Patrick Barwise and Sean Meehan, “The One Thing You Must Get Right When Building a Brand,” Harvard Business Review, December 2010, 80–84.

1. They offer and communicate a clear, relevant customer promise, such as fun, speedy delivery, or superior taste.
2. They build trust by delivering on that promise. Keeping a customer informed when something goes wrong can help build and retain trust.
3. They drive the market by continually improving the promise. A small business should always be looking to make things better for its customers. Think in terms of the total customer experience.
4. They seek further advantage by innovating beyond the familiar. If a small business focuses on the customer experience, there are undoubtedly ways to improve the brand by adding the unexpected.

The ultimate objective is to have a brand that delivers a clear message, is easy to pronounce, confirms a company’s credibility, makes an emotional connection with the target market, motivates the buyer, and solidifies customer loyalty.Laura Lake, “What Is Branding and How Important Is It to Your Marketing Strategy?,” About.com, accessed December 1, 2011, marketing.about.com/cs/brandmktg/a/whatisbranding.htm; Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 230.

Product Life Cycle

Every product has a life span. Some are longer than others. The pet rock had a very short life span. The automobile is still going strong. Some products or services experience an early death, not able to make it very far out the door. Take, for example, Colgate Kitchen Entrees (yes, as in the toothpaste); Cosmopolitan Yogurt (off the shelves in eighteen months); and Ben-Gay Aspirin (the idea of swallowing Ben-Gay was not a winner).“Top 25 Biggest Product Flops of All Time,” Daily Finance, accessed December 1, 2011, www.dailyfinance.com/photos/top-25-biggest-product-flops-of-all-time.

Even the big guys make mistakes, so small businesses are not immune from product goofs. The products that do make it, however, go through what is known as the product life cycle (PLC)The performance of a product in terms of sales and profits over time., defined as “the performance of the product in terms of sales and profits over time.”Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 244. The traditional PLC is shown in Figure 7.5 "The Traditional Product Life Cycle".

Small-business owners should understand the PLC because there are specific implications for marketing strategy. The product development (incubation) stageWhen a product is being prepared for sale. is when a product is being prepared for sale. There are costs but no sales. The product introduction stageWhen a product is available to buy for the first time. is when a product is available to buy for the first time. Sales will generally be low but increasing, marketing expenses will be high, and profits will be typically low or nonexistent. The focus of the marketing strategy will be to create awareness, establish a market, and create demand for the product.Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 339; Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 244; Kristie Lorette, “How Would the Marketing Mix Change at Different Stages of the Product Life Cycle?,” Chron.com, accessed December 1, 2011, smallbusiness.chron.com/would-marketing-mix-change-different-stages-product-life-cycle-3283.html. The product growth stageWhen sales grow rapidly as the target market adopts a product and competition enters the marketplace once it observes the success. is when sales grow rapidly as the target market adopts a product and competition enters the marketplace once it observes the success. Marketing strategy should focus on differentiation and building a brand preference. There is substantial profit improvement.Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 339; Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 244; Kristie Lorette, “How Would the Marketing Mix Change at Different Stages of the Product Life Cycle?,” Chron.com, accessed December 1, 2011, smallbusiness.chron.com/would-marketing-mix-change-different-stages-product-life-cycle-3283.html. Rapid growth must be managed carefully so that the company does not succeed into failure. The product maturity stageCharacterized by slow growth because most of the buyers interested in a product have bought it. is characterized by slow growth because most of the buyers interested in a product have bought it. Sales may increase but slowly due to intense price competition. Profits stabilize or decline. The marketing strategy must focus on getting people to switch brands by using special promotions and incentives.Philip Kotler and Kevin Lane Keller, Marketing Management (Upper Saddle River, NJ: Pearson Prentice Hall, 2009), 339; Dana-Nicoleta Lascu and Kenneth E. Clow, Essentials of Marketing (Mason, OH: Atomic Dog Publishing, 2007), 244; Kristie Lorette, “How Would the Marketing Mix Change at Different Stages of the Product Life Cycle?,” Chron.com, accessed December 1, 2011, smallbusiness.chron.com/would-marketing-mix-change-different-stages-product-life-cycle-3283.html. The product decline stageWhen sales decline and profits erode. is when sales decline and profits erode. A product has become obsolete because of an innovation (think VHS to DVD to Blu-Ray) or the tastes of the target market have changed. The marketing strategy works to reinforce the brand image of the product. The product may be dropped from the product line or rejuvenated if possible and practical.

There are many small business owners who may not see the PLC as applying to their products or services. After all, accounting services are accounting services, a luncheonette is a luncheonette, and hardware is hardware. Thinking this way would be a mistake. Accounting practices change, people’s tastes change, hardware solutions change, and government regulation inserts itself. What is successful today may not be successful tomorrow. The PLC provides guidance for watching how a product or a service progresses in the marketplace so that the necessary marketing strategy steps can be taken.

The Company Website

A company’s website is part of its product or service. The conventional wisdom is that all businesses should have a website. The reality is that there are many small businesses that do very well for themselves without a web presence. The small local deli, accounting or insurance services, a legal firm, a liquor store, or a dental office may not see the need for a website. At the same time, customers are increasingly expecting a web presence, so any small business that does not have a website runs the risk of losing sales because of it. The time may also be approaching when not having a website will be perceived as odd, with questions raised as to the seriousness of the business. Every small business without a website should determine whether this matters to them or not.

This section about the company website is targeted to the small business that has a web presence already or is planning to have one. A small business owner should have a basic understanding of website design to contribute to the discussion and communicate effectively when working with professionalsEfraim Turban et al., Electronic Commerce: A Managerial Perspective (Upper Saddle River, NJ: Pearson Prentice Hall, 2008), 751.—as well as to organize the owner’s visceral reaction when it is time to evaluate other websites, plan the company’s website, or revise the company’s current website.Jan Zimmerman, Web Marketing for Dummies, 2nd ed. (Hoboken, NJ: Wiley, 2009), 67. In addition, any commitment to e-marketing requires a website.

Stanford University’s Persuasive Technology Lab found that people quickly evaluate a website by visual design alone, with the visual design setting the tone for the user’s experience.Lorrie Thomas, Online Marketing (New York: McGraw-Hill, 2011), 22–23. “Image is everything online. Good design evokes trust, makes navigation clear, establishes branding, appeals to target customers, and makes them feel good about doing business with the website they are on. Design does not have to be expensive for it to work. It does, however, need to represent an organization and appeal to a visitor. Professional design is not something organizations spend money on; it is something they invest in to support trust, positioning, and long-term marketing” (emphasis added).Lorrie Thomas, Online Marketing (New York: McGraw-Hill, 2011), 23.

This section of the chapter discusses website objectives and the fundamental design elements: layout, color, typography, graphics, interactivity, navigation, usability, content, and performance. User experience is also discussed.