Question

Question 2: Product offering and targeting (30 marks, 300 words) A. Discuss the three levels of a product by using the Lebron 17 Basketball shoes as an example. (15 marks) B. Discuss the four targeting strategies. Which targeting strategy does Nike use for its Lebron 17 Basketball shoes. Justify your answer. (Check Nike website if you are not familiar with the Lebron Basketball shoes) (15 marks)

Answer 1

a.)

The three levels of a product are as follows -

1. Core benefit: The actual usage of the product for which the product is required by the customer. For example, the Lebron 17 Basketball shoes are basically for the purpose of sporting and playing basketball. That is the core benefit. But this is no way to differentiate the product from its competitors, and hence it is not used as a marketting or advertising strategy.

2. Actual product: This incudes the additional advantages of the product which make it stand out from its competitors. This includes features like the color, the additional features like comfort, etc. In the Basketball shoes example, this includes the lightweight mix of the materials used and the cushoning that provides cofort and bounce.

3. Augmented product: This includes the additional things that are not a part of the product physically, but are used effectively to increase the demand for the products. This includes the warranty that comes with the shoes for free repalcement in case of any quality default.

b.)

The four targetting strategies are as follows -

1. Undifferentiated targetting: This is when the company treats the entire market as one. There are no segments in the market and the company includes the entire market as one and introduces the same product for the entire market.

2. Differentiated / Multi-segment targetting: This method assumes that there are different segments in the market with different needs, and they introduce different variants of the same product to satisfy the different segments.

3. Focussed / concentrated targetting: This is used when the firm recognises different market segments, but chooses to focus on only one of those segments. The firm recognises its strength in serving the needs of only the one segment whose needs are close to the firm's production capabilities.

4. Customised targetting: This is when the organisation in involved in the kind of business which tenders to the needs of the individual customers. Each customer is served differently and the firm has resources enough to serve the individual needs.

NIke has used the focusses targetting market system. This can be justified by the following points -

- It has chosen a particular segment of the market - athletes, and even in that Nike has specifically chosen Basketball players to set the market for this product.

- Advertising and all other efforts to sell their product has been targetted to this particular group in the market.