Page 338 - Introduction to Business

312 PART 3 Marketing

ensuring their success in the U.S. car market. Chrysler’s trucks ranked lower on
quality than did Ford’s and General Motors’, forcing the company to evaluate
new models on quality while still in the design stage. The company added a vice
1
president for quality who implemented this new policy. Because of the prob-
lems Bridgestone-Firestone faced due to its tires shredding and causing auto-
mobile accidents, all its quality engineers now report to a vice president who, in
turn, reports to the firm’s CEO. 2
The name placed on a brand is a critical element of its marketing mix. The
wrong name can be a hindrance in getting the product accepted in the marketplace
and can adversely affect sales and profits. The right name can have a positive effect
on such objectives. There are a number of recommendations that companies need
brand names The name placed on a to follow when selecting brand names.
brand
Suggest the benefits of using the product (Gleem toothpaste, Spic’n Span
cleaner, Beautyrest mattresses).
Be short (Tide is a good example).
Suggest excellence (Gold Medal flour).
Be easy to spell (Manischewitz is not easy to spell).
Not have geographical connotations; they may preclude mass-market
acceptance because a local orientation is suggested (Lee Conshohocken
Tires is an example; Conshohocken is a suburb of Philadelphia, where the
company’s tires are produced).
Have an obvious meaning (Kreml and Drene were two hair-care products
that violated this recommendation).

National brands are brands that carry the name placed on the product by the
national brands Products that carry
the brand name of the manufacturer manufacturer, Procter & Gamble’s Pampers and Crisco, for example. They may
carry the name of the company, like Ford Explorer or Ford Taurus. Private brands
private brands Products that carry the
brand name of the retailer carry the retailer’s brand name, such as Talbot’s women’s clothes or Albertson’s
generic brands Products that do not peanuts, cream cheeses, or canned vegetables. Generic brands do not carry a
have a brand name, but contain only brand name; instead, the label designates the content of the package, such as white
an indication of their contents on cake or tomato juice. National brands give the manufacturer the greatest level of
the package
control over marketing their product. Retailers benefit from carrying national
brands because of the advertising and promotion dollars spent on the brand names
by the manufacturers, which produce the name recognition in the marketplace that
attracts consumers to the stores that are carrying these national brands.
Private and generic brands, however, are controlled by retailers; often the name
of the retailer will be on the private brand. As retailers like Wal-Mart have gotten
more powerful in the last twenty years, more private brands have appeared. Usually
private brands carry lower prices than national brands. Because generics’ prices are
even lower than those of private brands, their sales normally increase during peri-
ods of economic downturns.
protective package The package that There are two types of packages. The protective package safeguards a product as
safeguards products as they are being it is transported from manufacturers to wholesalers to retailers. The promotional
transported
package is the one that encloses each unit of a product; it is the one that we see on
promotional package The package
retailer shelves that shouts at us “Buy me.” Because some one-third of products
that encloses a product whose
purpose is to help sell the product at may not be advertised, the promotional package takes over the promotional job.
the retail level Successful packages often benefit the retailer or the consumer. For example, a pack-
age may enhance stackability of a product on the retailer’s shelf and increase the
length of time it can be stored at home before spoiling.
Packaging is expensive. In general, a package represents 25 percent of a product’s
total cost. For some products—beer, soft drinks, baby food, and frozen dinners—the
cost of the package may exceed that of the contents. Because packaging materials

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