Lecture 09: Product Differentiation and its Elements - 1

Hello friends, welcome back to  Product and Brand Management.

Up till now, we have tried to build up  our concepts and conceptual understanding

through terminologies, brief understanding on  some product related concepts and philosophical

perspective and as of now, I feel that you are  aware of the fundamentals, which would come up

in due course of time in most of our  discussions starting from today.

Because, today onwards we will be talking about  the strategic and management perspective of

product and later on product being a  brand and branding and it is going to

become more interesting in due course  of time wherein, it will create

a picture in your mind wherein you would be  observing everything around yourself with the

perspective of product management and branding. Whenever you would be looking at a water bottle

now, the design and the appeal would come  to your mind and the perspective would come

to your mind about what the marketer would  have thought of when developing this product.

Is it be related to ease of how you drink water?  Did he have this thing in mind? Did he have the

element of durability? Did he have the element  of ease of carrying this bottle when he conceived

or she conceived that you would be carrying this  bottle all along? Would it have been related to

actually how you would hold this bottle  in your hands? How would you open up the

lid or the cap and the way you would drink? For example, someone wants to drink water in a

hurry and while walking. Would it be feasible and  what if children would be handling the bottles?

So, for example, I remember I was talking to  a senior executive of a manufacturing company,

which manufactures water bottles for school kids.  Now, he told me an interesting thing actually.

He told me that when they were producing  water bottles for kids in general

there was a sales perspective which was growing  and sales was rising and so on and then they

were marketing it with an emphasis on how water  would remain cool or hot as per the requirement.

But, when they started distributing or  marketing the same product in the rural areas,

lots of complaints started coming in, especially  with reference to kind of the durability of the

product, that the product is not durable and it  is getting broken in a very short span of time,

and it was not very unique to rural  areas, when they started expanding in the

smaller cities, rural areas and so on.

So, now a very different kind of an  input was given to them about the

behavioral perspective of kids there in different  kinds of schools, which they started getting

interested in after that. I am not saying that  there is a differentiation between urban schools

or rural schools, but there was a behavioral  difference wherein the children in those schools

where they started marketing their product. They  started playing with water bottles actually,

now, they started using it as a temporary bat  or something. They were found hitting the walls

with the water bottles and so on and the  that is how the complaint started pouring.

Now, that very interestingly motivated the  product manager to take this up with the

production team and then they created a sturdy  form of that water bottle for almost all the kids

realizing the fact that this can be a behavioral  change in any of the kids, whether it be rural,

semi urban or urban in whichever way.  So, this can be a behavioral perspective,

which must be addressed. It should be safer,  this should be sturdy, it should not break.

Now, that was for the first time they considered  that and that is where the need of product

differentiation and those kinds of elements come  in. Here in this brief description, I wanted you

to imagine that continued touch with consumers  and customers through marketing research. A

product manager gets a view of how product is  behaving in the market, how it is being accepted

and so on. Then looking at the perspective he  or she tries to create a differentiation with

the help of the production team and projecting  that differentiation in front of the customer.

Now, starting the story that is where product  differentiation comes into being all the products

and remember all the products are thought of being  different by their producers and product managers.

Basically, that is the ultimate objective of every  product manager to project whichever product they

are developing or driving to be different. How  different is just a challenge, because there is

a scope of differentiation in all the products. In larger products, for example, you can create

lots of difference and for example an aircraft.  In subsequent session you would realize that there

is not a huge scope of differentiation, when you  are talking of a water bottle. So what kind of

differentiation elements you choose, which is a  very big challenge, because that differentiation

element can (as I talked) earlier also can  alter the complete supply chain at the backend

production processes on the one side (that  is a tedious process) but on the other side,

how to protect that even if you have  brought that particular kind of a change.

For example, in an aircraft, you have brought  in a particular kind of a change in the seat,

and that change can be experienced by the  customer, he feels happy, delighted, but,

neither customer can express that he is feeling  happy and delighted because of the seat curvature

nor you have projected that way if you are a  product manager. So, how actually to project

it that is also a perspective and here in  product management course, we are largely

focusing on the marketing part of how to bring in  differentiation, how to project a differentiation,

although it is intensely related with  the production part as such.

So, to be branded, products must be  differentiated, however, indifferentiable they are

the differentiation can be seen with the physical  perspective features, form, style etc. and

services, which can also be differentiated with  the perspective of how service is rendered.

Now, physical difference is important, although  service differences are equally important, but

physical difference in product is very visible and  the importance of visibility actually is carried

along with that. That thing, which is the reason  for organizations focusing on research on design

and design thinking and I will be talking about  that later on through several kinds of examples,

wherein, I would be suggesting few organizations.  I would be talking about them, which are

specifically working upon design, design,  development, design thinking and those kinds

of elements and there are a whole lot of designers  around the world, who are actually focusing upon

product development, product management and as  such. India is very rich nowadays, as far as,

these kinds of design organizations, which  work in their design studios day in day out.

So, there are products, which have low variations,  for example, aspirin, some grocery products. So,

how to differentiate them? You have to  actually project the differentiation in

the perspective and we will see that when  we will talk about positioning elements,

and then there are high variation products as I  said automotive, commercial buildings, furniture

and that can be expressed well. So, there  you have a larger scope of as far as

differentiation goes. Now, let us look at a few of the elements

of differentiation, for example form. Now, many  products can be differentiated in form, the size,

the shape or physical structure of the product.  You would have noticed that many mobile phone

manufacturers have actually been projecting the  mild slightest change in the size of the mobile

phone with reference to that, it has brought  in more visibility in terms of whatever you

are watching on the mobile phone with reference  to kind of many mobile phone manufacturers are

projecting the changes which they have brought in  terms of the lenses of cameras, the cameras which

they are fitting in. Someone says that there  are three, someone says there are four even

to make it more enable in terms of for the people  who like to click from their mobile phones, who

often take photographs and who love to capture  the scenes videos and photography and so on.

So, that smallest of the size also  matters if you can project it well. Now,

that is the perspective which we are carrying  here, shape, definitely, matters a lot.

People work upon shapes with so much of intensity,  how aesthetic it can be? What are the curvatures?

How would it look actually, what would it  resemble? And, this element definitely resonates

with the discussion we have had in personality,  when we were talking about personality.

So, consider many possible forms, disposable  plates may have and you would know the difference,

you would notice the difference, it is an  interesting kind of a thing and disposable spoons,

for example, many times you go to picnics and  you have packaged food and if your spoon is not

having that kind of a curvature, you would not  actually enjoy eating that is the slightest

of the thing basically, which actually  matters a lot at the end of the day.

So, try and notice these things all around you.  Although essential a product can be differentiated

by size, shape, color coating, etc for example.  There are chewing gums, there are chocolates,

toffees wherein, there are several kinds of  elements which can be incorporated there and

I would not repeat on larger products. Features, most products can be offered

with varying features that  supplement their basic function,

marketers should consider how may people want each  feature, how long it would take to introduce it,

and whether competitors could easily copy it or  not, because we are talking of differentiation,

we want to keep up the differentiation. And we  want to project that particular differentiation

with relevance carry the relevance for the  customer. So that is what the effort is.

And I am trying to emphasize here that  differentiation has to be made noticeable and

relevant for people, for example there is a  notebook, the page is very smooth white, now,

it has to be projected in front of the child  or the person who is using that particular

notebook that this page actually would give  him satisfaction when he writes on it. Now,

it is a very simple thing, we might not have  noticed this for a long time, but again, this is

a thing which has to be projected by  the marketer and the Product Manager.

Now, let us take some examples, further to this  for example, laptops. Differentiation should be

meaningful and not just the color of the laptop  here, it is very important, because I have seen

many organizations projecting the colors, so,  that matters a lot, but again, the point is

laptop has a fundamental relationship with the  kind of efficiency that laptop may carry.

So, that meaningfulness must be projected  before the looks and the aesthetics and

so on and definitely many organizations  have been projecting, for example, the

laptops getting converted into tabs and then  one model is yoga laptop marketed with that

kind of a perspective. So, that is a very  interesting part, and people do like that.

And, and that is why it is so intelligent of  product managers to actually think of these

kinds of things. But again, meaningfulness  has to be projected. Automobiles like, Bajaj

Pulsar DTSi differentiated for its digital twin  sparkplug ignition feature. Now, this is slightly

difficult to project, but, I commend that Bajaj  has done it well. Their advertising partners

or agency, they have done very well when they  projected DTSi with a branding perspective.

I do not know how many of you would remember the  full form of DTSi or you would actually know but,

that connotes something in your mind, which is  related to efficiency, power, strength and so on,

and it has become a brand in itself. So, that is  what we are talking of and I will be unfolding

so many things related to this in due course of  time when we will talking of brand management.

Now, comes in performance quality; quality  related to performance of the product.

See performance quality is the level at which the  product s primary characteristics operate. Again,

remember however we project the product, it cannot  be differentiated from the core value which it

should carry in due course of time. So, customers  will pay for better performance as long as

higher performance does not exceeds  the perceived value of the consumer.

Sony Xperia Pro, Nikon mirrorless  cameras, Surf Excel, several kinds

of examples are there. Many a times talking of  Surf Excel (or any detergent for that matter),

it has been very strongly projected. Similarly,  Tide Hai to White Hai . That kind of thing,

that is very efficient of them  and that has worked for them.

But, that is from the side of advertising and  integrated marketing communication manager or

person who is driving the message actually,  but for product manager, when you say that

it is driving the whiteness on a cloth, then  product manager s intensity lies in generating

the relevance related to that statement, which has  been released, that means the customer should feel

that the detergent has actually created that  particular difference. So, that is why they always

show you that dip it there and you bring it up and  it is sparkling white. Do you actually feel that

way? I do that sometimes, I wash my own clothes  many a times. I have been telling you that.

So, now, quality of conformance; do not think that  I have to wash my clothes always. Now, quality of

conformance is the ability of a product, service  or process to meet its design specifications.

It confirms to the design and in other  words, it is a measure of how close

products and services come to meeting planned  criteria once they are produced or delivered.

Example can be a Porsche 911 which is designed to  accelerate 60 miles per hour within 10 seconds,

just push the pedal and it goes to almost  at 84-85 kilometers per hour speed within 10

seconds. It is a very high speed basically the  model is set to have high conformance quality

although they might have increased the speed and  today rapidly that function is going very high.

I have been told that many automobiles probably  this one also has gone to 100 kilometers per hour

in 4 seconds, 5 seconds. It can be relative  and can be cross checked also but just to

give you an insight that high speed within a few  seconds. Now, that is where conformance with their

kind of quality comes in or whatever it  is projected in front of the customer,

whatever customer expects from such  kind of products and so on.

Durabilit; every product  is supposed to be durable.

I do not think that you take your woolen  suits as perishables. So, while designing

woolen suits, coat and pair of pants and those  kinds of the cloth, the fabric related to that,

the producers the product manager when talking  to production managers or their research and

development team, focus upon that people would  love to have this for long number of years.

However, the stitching becomes out of fashion  or something though people would not like to

just throw it away because that requires lots  of effort for selecting a particular fabric and

design for you and then getting it stitched up to  your mark and so on. So, even in case of fabric,

which is itself is perishable after  a particular kind of stage except for

silk, which is long lasting, if maintained, well,  wool definitely, but, again, the point is in

such cases also the durability matters. And when you are talking of automobiles,

when you are talking of machines, when you are  talking of refrigerators in your homes, you want

that to be flawless, you want that to be having  or carrying a particular kind of a strength,

which stays there and see to that what extent  you would give it that kind of a strength.

Because ultimately you have to think in  terms of cycles, it s own life cycle,

the lifecycle of the product and the associated  usage and then customer preferences which would

keep on changing. You have to project those things  as well. But regardless of that, even if customer

wants something new within a very short span of  time customer would still not be compromising on

the durability element and please remember this. Many manufacturers have tried to confirm

the durability element. With the time span the  customer would change his mind in terms of usage

of that product. They have tried these  kinds of things, but that has not worked,

because there is a huge variation between  the behavior of customers within the

same bracket with regards to durability. For example, within one target segment, you would

find let us say 30 percent, 40 percent, 50 percent  people who would like to change their automobiles

in 5, 6 years, but within the same target  segment 30, 40, 50 percent would be who would

carry forward their automotives for another 5, 6  years. But for both of them durability matters.

So, that is a very strong element of a product  and it is a measure of the products expected

operating life under natural or stressful  conditions. It is checked on factory floors for

with so many dimensions and it is the domain of  production and operations management which you can

study from one of those courses. For example, power drilling machines. How

strong it is? How durable? Also, when we are  talking of the element of the involvement of

a particular product in the safety of let us say  your house for example, electrical wires, you want

strong durability element there. Another example  is tires. Today, when you go to a super highway,

you can drive very fast for a longer  span of time and tires get heated up

now, that is where durability perspective comes  in. You would never like your customer to suffer

just because of undurable tires. That is what  so, many companies are projecting nowadays.

You got my point. You would have watched the  advertisements related to the durability of tires

in recent times and it is in consonance  with the upgradation of highways India is

going through which is excellent. So, now, when we are talking of

durability perspective, the extra price for  durability must not be excessive, however,

and the product must not be subject to rapid  technological obsolescence also examples are Smart

phones, Cement for example, Ambuja cement says  har nirman ki jaan it will stay forever.

Reliability; buyers normally will pay a  premium for more reliable products. Reliability

is a measure of the probability that a product  will not malfunction or fall within a specified

time period. Godrej Steel Almirah is  one of those products you would find

stories around. This product is present in  almost every home is possessed and people

would say that it is there for 30 years, 40 years  and it has been known for the strength. They have

enjoyed this kind of feedback all through. Tata Steels produce so many products related

to that, and Castrol magnetic is more than just  oil. It is liquid engineering, as they say. Now,

that is an extreme kind of an assurance to the  customer which Castrol lives up to definitely.

So, that reliability perspective that you depend  upon which assures that product is very important

and these elements are catered to by product  management, product managers and projected as the

elements of brand which we will talk about later  on and are conveyed through integrated marketing

communication which we will be talking about in  brand management as well for a little while.

Repairability, measures the ease of fixing  a product when it malfunctions or fails.

You would not like any product to be frequently  repaired and especially those products, which you

depend upon. Remember the earlier days of laptops  and computers. There were so many things. Though

these organizations have come a far way when  your laptop, somehow one of the applications is

not working and they get to know that in real  time. They try to infuse support from their

itself and while doing your job the file does not  get corrupt. It gets stored at the back end and

when you switch it on, once again, the file in  its due form comes back. I remember in earlier

days when I used to type data used to get lost  somehow and so on. So many things were there.

And I am talking of software repairability  which is a very important element of our

lives today. And when we talk of repairability  of other products, for example, in summers,

if air conditioning is not working well, if  your air conditioner always malfunctions,

then you would not like that somehow. There are  several case studies on that, air conditioning,

refrigeration, televisions in today's era, no  one wants to remain away from a display screen.

Now, if the display screen gets blackened  out, it is TV or a mobile phone or a computer,

what would you feel, shut off from the world  that is where the durability, reliability,

repairability aspect of these products are  important. Because, if it goes off once,

you would never look towards that kind of a  product, further you will feel dejected actually,

so that is the job of a product manager who  actually tries to assure that with the help

of their research and development team and at the  back end and production teams and so on, who is

working day in day out on that. So, see repairability measures the

ease of fixing a product when it malfunctions  or fails as I said, ideal repairability would

exist if users could fix the product themselves  with a little cost in money or time. And many,

many organizations give you guides which work very  well and then there are software guides also.

So, some products include a diagnostic  feature that allows service people to

correct the problem over the telephone  or advise the user how to correct it.

And many computer hardware and software companies  offer technical support over the phone by fax or

email or via real time chat online and they keep  on guiding you how to best use it and so on.

Sometimes, there are compatibility issues and  nowadays when so, many new applications are

coming there are several compatibility issues when  one of the applications is not working, because

you have downloaded the other application which  is not complementing the existing application

at the back end and so on. And this makes you  puzzled on because you do not know about this. So,

you just go to the site of that organization  and then FAQs, they will advise you and we

have referred to FAQs as a point of discussion  earlier as well, examples are Whirlpool or LG,

and several electrical appliances and so on. So, I will end this part of the discussion in

this session here itself and I will be coming back  to you with some more elements of differentiation.

And remember that these elements however  sublime in character or nature they are,

but are one of the most important differentiating  factors when you start using a product and

when you become loyal to a product. So, you see  that is how product management is related to

gaining the loyalty of the customers in long  term and converting a product into a brand.

So, I will be coming back to you  next time till then, goodbye.