[MUSIC] Hello, welcome back to our marketing course. Today we will discuss Product and service decisions. We will explore which are the most important decisions a company has to make regarding the products and services in markets. One of the first decisions is to decide which products to sell and how did company is going to organize them. Every individual group is known as SKU, stock keeping unit. Which is a quote that identifies in a unique way every item we produce or we sell. Products are grouped into families, each of which is known as a product line. Imagine your farm that produces and sells dairy products. You may produce cheese, fluid milk, butter, yogurts, or ice creams. Each of these product families is what we know as a product line. Imagine that in the yogurt family we have ten flavors and three sizes per flavor. Then we could say our product line is composed of 30 SKUs. To summarize, we could define a product line as a group of products that are closely related to each other. Either because they function in a similar manner, are sold to the same customer group, or is marketed through the same types of outlets. This is a definition that is provided by Professor Kotler. We may say that the larger the number of SKUs in the family is, the deeper the product line is. Product line depth then could be defined as the number of products in each product line. In our case it would be the number of yogurts or ice cream flavors we have. What is product-line width? Well, it is a number of product lines in a company's product mix. In our daily product example, a farm that produces fluid milk, butter, cheese, yogurts and desserts has a wider product line than a competitor that produces only cheese and butter. If we combine all the products over all the families we have what we call Product Mix. Product Mix then can be defined as the set of all the products and items a particular seller offers to the market. In our case it would mean all the, products our farm sells. Product Portfolio is a combination of products and product lines balanced to achieve the company's profitability goals and to satisfy the needs of the custom of the target market. In that case the Product Portfolio is different than the notion of product makes. The Product Portfolio may be smaller than the product makes overall because we may decide to sell only a few products out of the total makes we have. Lets give an example, a meat processing company that produces pork, lamb and beef products may decide to exclude pork products based on the fact that in certain countries, due to taste test preference and religious issues, these products cannot be sold. What is a product-line extension? It's a method to add products to the product mix by introducing new products into an existing product line. After deciding which products to sell, the first thing you have to do when defining a product is to think about which are going to be the attributes that you're products are going to have. We have to define things such as features, design, packaging, label, and name. From a marketing viewpoint, one the most important attributes if not the most important one is the brand. But this is an issue we will discuss in our next session. Thank you very much, I look forward to meeting you when you're going to discuss brand. [MUSIC]