Professional Documents
Culture Documents
What is a product?
• The success rate of new products is very low – less than 5%. ‘You have to kiss a
lot of frogs to find a prince.”
• Shorter PLCs
Product Development Stages
• Idea generation
• Idea screening
• Concept testing
• The most customer appealing offer is not always the most profitable to make
• Estimate on costs, sales volumes,pricing and profit levels are made to find out the
optimal price – volume mix.
• Test markets
• Test periods
• When? (Timing)
Product Levels
Customer value hierarchy
• Core benefit
• Basic product
• Expected product
• Augmented product
• Potential product
Customer Delight
• Need
• Product family
• Product class
• Product Line
• Product type
• Brand
• Item
Product classification
• Durable
• Non – durable
• Services
Consumer goods classification
• Convenience goods
• Shopping goods
• Specialty goods
Unsought goods
Industrial goods classification
• Capital items
• Product rationalization
• Market rationalization
• A name becomes a brand when consumers associate it with a set of tangible and
intangible benefits that they obtain from the product or service
• The difference between the perceived value and the intrinsic value
Levels of meaning
• Attributes
• Benefits
• Values
• Culture
• Personality
• Users
Brand Power
• Trade leverage
• Can charge a higher price
• Brand Equity needs to be nourished and replenished. We must not flog the brand
for equity to be diluted or dissipated
• Store brands
Advantages of branding
• Easy for the seller to track down problems and process orders
• Sometimes the company name is prefixed to the brand. In such cases the company
name gives it legitimacy. The product name individualises it.
Naming the Brand
• Product benefits
• Product qualities
• Easy to pronounce
• Should be distinctive
• Should not have poor meanings in other languages and countries
Brand strategy
• Line extension – existing brand name extended to new sizes in the existing
product category
• This may be required after a few years to face new competition and changing
customer preferences
Packaging
• Includes the activities of designing and producing the container for a product
• Self service
• Consumer affluence
• innovation
Designing packaging
• Packaging concepts
• Technical specifications
• Engineering tests
• Visual tests
• Dealer tests
• Consumer tests
• Packaging innovations
• Environmental considerations
Labels
• Identification
• Grade classification
• Description of product
• Manufacturer identity
• Promotion
Labels as a marketing tool
• Discuss how companies develop strong identities for their products and brands.
• Identify and briefly describe each of the four strategies for new-product
development.
• Buyers respond to branding by making repeat purchases because they identify the
item with the name of its producer.
• Brand: name, term, sign, symbol, design, or some combination that identifies the
products of a firm while differentiating them from the competition’s
12-5
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reserved.
• Brand Loyalty
• Captive brands: national brands that are sold exclusively by a retail chain
• Individual brand: unique brand name that identifies a specific offering within a
firm’s product line and that is not grouped under a family brand
12-8
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reserved.
• Brand equity: added value that a respected, well-known brand name gives to a
product in the marketplace.
• Brand equity increases the likelihood that consumers will recognize the
firm’s product when they make purchase decisions
• Brand Equity
• Brand name: part of a brand consisting of words or letters that form a name that
identifies and distinguishes a firm’s offering from those of its competitors
• Generic name: branded name that has become a generically descriptive term for
a class of products (e.g., nylon, aspirin, kerosene, and zipper)
12-12
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reserved.
• Trademark: legal protection which confers the exclusive right to user brand
name, trade mark, and any slogan or product name abbreviation
• The distinctive shape of Philips light bulbs and the McDonald’s arches
provide an example of trade dress
12-13
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reserved.
• Trademarks that are effective in their home countries may fare less well in
other cultures
12-14
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reserved.
Packaging
• Cost effectiveness
• Labeling
• Label
• As a firm’s offerings enter the maturity and decline stages of the product life
cycle, it must add new items to continue to prosper
• Awareness
• Interest
• Evaluation
• Trial
• Adoption or rejection
12-19
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reserved.
• Consumer innovator: People who purchase new products almost as soon as the
products reach the market
• Diffusion process: Process by which new goods or services are accepted in the
marketplace
12-20
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reserved.
• Figure 12.8
• Categories of Adopters Based on Relative Times of Adoption
12-21
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reserved.
• Relative advantage
• Compatibility
• Complexity
• Observability
12-23
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reserved.
• New-Product Committees
• New-Product Departments
• Product Managers
• Venture Teams
• Task forces
12-24
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reserved.
New Product Development Process
• New product development process: six stages through which new product ideas
progress before being introduced to the overall market
12-25
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reserved.
• Idea Generation
New product ideas come from many sources including:
• Screening
Screening separates ideas with commercial potential from those that cannot meet
company objectives
• Business Analysis
The business analysis consists of assessing the new product’s market potential,
growth rate, likely competitive strengths, and compatibility of the proposed
product with organizational resources
• Concept testing
• Development
Converting an idea into a physical product
• Test Marketing
Test marketing: Introduction of a trial version of a new product supported by a
complete marketing campaign to a selected city of television coverage area
• Commercialization
In this stage, the firm establishes marketing strategies, and funds outlays for
production and marketing
brand management
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Definition
The process of maintaining, improving, and upholding a brand so that the name is
associated with positive results. Brand management involves a number of important
aspects such as cost, customer satisfaction, in-store presentation, and competition. Brand
management is built on a marketing foundation, but focuses directly on the brand and
how that brand can remain favorable to customers. Proper brand management can result
in higher sales of not only one product, but on other products associated with that brand.
For example, if a customer loves Pillsbury biscuits and trust the brand, he or she is more
likely to try other products offered by the company such as chocolate chip cookies.
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Exploring Careers in Jobs in Marketing
Brand Management : Is it the Right Marketing Career for You?
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