Product scope: goods, services, experiences, events, persons, places, properties, organizations, information and ideas. Product Levels: Show
Delight Customers by exceeding expectations. Product Heirarchy:
Consumer Goods Classification:
Width measures the # of product lines a company offers. Enables a firm to diversify products, appeals to different consumer needs and encourages one stop shopping. Product Line Decisions: Coke Hunts for Talent ro Re-Establish Its Marketing Might Brand What is Branding? Why Brand? Definition:
TO BUYER:
TO SELLER:
Brand Equity (Customer Equity) Brand awareness:
The Best Global Brands:Handout Brand Name Decisions:
Selecting a Brand NameCriteria for choosing a name, some issues to consider:
Domain Names: Highjacking issues? (Highjacked Domain and New Domain): Help! I've Lost My Domain Name! Discussion Topic: Investigate the above issues to determine who has rights to the use of a domain name. Discussion Topic: Discuss the challenges of branding on the web, how are Pampers developing a branding strategy? Arthur Andersen changes name to Andersen Discussion Topic: Discuss the evolution of the value of the brand: Andersen Brand Licensing Discussion Topic: Discuss the role the corporate logo plays in branding. Cite logos and their inherent value. Discuss logos which have changed, and why? PackagingConsists of a products physical container, label and/or insert.Approximately 10% of product selling cost. Development of a container and a graphic design for a product. Can effect purchase decisions IE pump dispenser on a tube of toothpaste. Packaging Functions include:
AOL Packaging Labeling Product Positioning and Product RepositioningDefinition:This refers to a place a product offering occupies in consumers' minds on important attributes, relative to competing offerings. How new and current items in the product mix are perceived, in the minds of the consumer, therefore reemphasizing the importance of perception!! New Product--need to communicate benefits Ideal CharacteristicsNeed to introduce products that possess characteristics that the target market most desires, ideal. Product positioning is crucial. Consumers desires refer to the
attributes consumers would like the products to possess--IDEAL POINTS. Each product must provide some unique combination of new features desired by the target market. Instead of allowing the customer to position products independently, marketers try to influence and shape consumers concepts and perceptions. Marketers can use perception maps. Existing ProductsSun Tan Lotion Example:^ | | Old Position | New Position | | | Glamour--------------------------------------------------Health | | | | | | |Traditional sun tan lotion positioned as aiding in getting a very glamorous deep tan etc. Dermatologist reports...skin cancer etc. Lifestyle needs change, move to more health conscious society Need to reposition sun tan lotion as a healthy way to be exposed to the sun. Target market has shifted from the left quartile to the right quartile as far as needs are concerned. Sun tan marketers need to do same as far as changing consumers perception for the product. How?
BMW positions on affordability^ Very Safe | Lexus/infiniti | Mercedes | BMW | | | Cheap--------------------------------------------------Expensive | | | | | | | Very UnsafeBMW, to reposition up to the left Due to the exchange rate, Lexus moves to the right Why did they repositition? If you already have a brand in the market, must be sure to avoid cannibalization. Attributes and brand image should give a product distinct appeal. New Product PositioningWhen developing a new product, a company should identify all the features that are offered by all its major competitors.Second, identify important features/benefits used in making purchase decisions. Determine the overall ranking of features by importance and relate the importance of each feature to its "uniqueness": what are the unique selling points (USPs). For example you wouldn't buy a spreadsheet program that if it didn't perform basic math, so basic math is very important. The flip side would be a spreadsheet that displays all numbers in binary (0-1) instead of "normal" numbers (0-9). This is unique but not important. The evaluation becomes a 2 x 2 matrix with uniqueness on the X-axis and importance on the Y-axis. ^ X Important to TM (Stockbroker) X Math functions | Import Data | | | | | ----------------------------------------------------------Unique | | | | | | | X Binary DataIf the feature is in the upper right hand corner then you have probably got a winning feature (USP). This is known as feature positioning, as opposed to product positioning. One can then see what type of customer needs the important (and perhaps unique) features. If your spreadsheet accepts continuous data in real-time (such as stock market data) while Excel doesn't, you'd position your spreadsheet as a "real-time spreadsheet with all calculations needed by Wall Street." Its a claim that tells something unique about your product, who it's for, and by implication, that Excel can't do it. Product Life CyclePopularized by Theodore Levitt, 1965PLC can be applied to:
IntroductionFailure rate for new products can range from 60%-90%, depending on the industry. A product does not have to be an entirely new product, can be a new model (car), a new product for the company, or repositioning a product to a new market.Marketing Mix(MM) considerationsNeed to build channels of distribution/selective distributionDealers offered promotional assistance to support the product...PUSH strategy. Develop primary demand/pioneering information, communications should stress the benefits of the product to the consumer, as opposed to the brand name of the particular product, since there will be little competition at this stage and you need to educate consumers of the product's benefits. Price skimming...set a high price in order to recover developmental costs as soon as possible. Price penetration...set a low price in order to avoid encouraging competitors to enter the market, also helps increase demand and therefore allows the company to take advantage of economies of scale. GrowthNeed to encourage strong brand loyalty, competitors are entering the market place. Profits begin to decline late in the growth stage.May need to pursue further segmentation. MM considerationsMay need to perform some type of product modification to correct weak or omitted attributes in the product.Need to build brand loyalty (selective demand), communications should stress the brand of the product, since consumers are more aware of the products benefits and there is more competition, must differentiate your offering from your competitors. May begin to move toward intensive distribution-the product is more accepted, therefore intermediaries are more inclined to risk accepting the product. Price dealing/cutting or meeting competition, especially if previously adopted a price skimming strategy. MaturitySales curve peaks-severe competition, consumers are now experienced specialists.MM ConsiderationsA product may be rejuvenated through a change in the packaging, new models or aesthetic changes.Advertising focuses on differentiating a brand, sales promotion aimed at customer (PULL) and reseller (PUSH). Move to more intense distribution Price dealing/cutting or meeting competition Provides company with a large, loyal group of stable customers. Generally cash cows that can support other products. Strategies during maturity include:
DeclineSales fall off rapidly. Can be caused by new technology or a social trend.Can justify continuing with the product as long as it contributes to profits or enhances the effectiveness of the product mix. Need to decide to eliminate or reposition to extend its life. MM ConsiderationsSome competition drop outNeed to time and execute properly the introduction, alteration and termination of a product. Cannibalization strategies to introduce new products. Need to manage product mix through their respective life-cycles. When to decide to introduce new (modified) products that compete with the current product offering. Different types of Life Cycle Curves
Developing and Managing ProductsTo compete effectively and achieve goals of an organization, the organization must be able to adjust its product mix.Need to understand competition and customer attitudes and preferences. Timex Turns down the Swatch1982, Timex turned down the opportunity to market "Swatches".Timex was resting on its laurels, simple low cost watches. Digital revolutionized industry technological change, Timex stuck with analog. DID NOT KEEP UP WITH WATCHES EVOLUTION FROM A FUNCTIONAL OBJECT TO A FASHION ACCESSORY. Now consumer owns 5 watches up from 1.5 30 years ago (emphasizing fashion need). Timex has acquired Guess and Monet Jewellers (distribution outlets) in an effort respond to change. Developing New ProductsNeed to develop new products. A new product can be:
For a new product to succeed it must have:
Failure not to introduce new products is also risky. IE Timex above Firms develop new products in three ways:
Why New Products Fail
Seven phases to new product development:
Buyers' Product Adoption Process
Diffusion ProcessThe manner in which different members of the target market often accept and purchase a product (go through the adoption process)
Product and physical distribution must be linked to patterns of adoption and repeat purchase. Discussion topic: Discuss the differences in the new product development process for digital goods versus tangible goods, consider intellectual property issues, standards issues etc? Relevant Knowledge@Wharton ArticlesCorporate Sponsorships of Stadiums and Other Institutions Don�t Always Pay OffSwitching names, effect of brand. Value to stadiums, value to customers? How to Keep Others From Ripping Off Your Ideas Poachers Are Out to Plunder Your Intellectual Property Can you Do Anything? Intellectual Property: WIPO Link to discussion board What is the name for the collection of activities in which businesses sell things to buyers multiple choice question?Marketing refers to all activities a company does to promote and sell products or services to consumers. Marketing makes use of the "marketing mix," also known as the four Ps—product, price, place, and promotion.
What is a difference between a consumer product and a business product quizlet?Consumer products are products that are purchased for personal consumption, whereas business products are products that are used either directly or indirectly to produce other products.
What is the name for merchandisers that carry any goods that they think they can sell profitably?SCRAMBLED MERCHANDISING--retailers carrying any product lines they think they can sell profitably. CORPORATE CHAIN--a firm that owns and manages more than one store--and often it's many.
What is the best definition of place in marketing strategy?Definition: Place in the marketing mix refers to the channel, or the route, through which goods move from the source to the final user. Place could be the intermediaries, distributors, wholesalers and retailers.
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