MGT301 Principles of Marketing

Lecture-21

Summary of Lecture-20

Individual Product Decisions

Product Attributes Branding

Packaging
Labeling Product Support Services

Quality

Features

Design

Branding

Brand Development

Four Brand Strategies

Product Category
Existing New Brand Extension

Brand Name

Existing

Line Extension

New

Multibrands

New Brands

Todays Topics Product (cont..)

A Good Brand Name Is...

Short and simple Suggestive of product benefits Legally available No negative imagery Easy to spell, read, and pronounce Adaptable for international markets Adaptable to packaging/labeling needs Adaptable to any advertising medium

Generic name: A brand name that has become a generally descriptive term for a class of products.
If this occurs, the original owner loses exclusive right to the brand name (which is very bad for marketers). Examples: nylon, aspirin, escalator, kerosene, etc.

Packaging

Activity of designing and producing the container or wrapper for a product. Packaging used to just contain and protect the product.

Goals of Packaging
Protection against damage, spoilage, tampering etc.

Assistance in marketing the product

Cost effectiveness (and good for the environment)

Labeling

Printed information appearing on or with the package. Performs several functions: Identifies product or brand

Describes several things about the product

Promotes the product through attractive graphics.

Universal Product Code (UPC)

A bar code on a products package that provides information read by optical scanners. UPC codes provide several advantages: labor saving, improve inventory control, and help with marketing research.

79400 80740

Competitive Advantages
Sales Tasks Identifies Packaging Labeling Product Safety Promotes

Describes

Product - Support Services

Companies should design its support services to profitably meet the needs of target customers and gain competitive advantage.

How?

Step 1
Survey customers to assess the value of current services and to obtain ideas for new services.

Step 2
Assess costs of providing desired services.

Step 3
Develop a package of services to delight customers and yield profits to the company.

Product Line Strategies

Product Line Extensions

Stretching
Adding new items to line Downward

Filling
Adding sizes or styles

Contracting a Product Line Dropping items

Upward Two-way

New Product Development

The development of original products, product improvements, product modifications, and new brands through the firms
own R&D efforts.

Major Stages in New-Product Development

Marketing Strategy Business Analysis

Concept Development and Testing

Product Development

Idea Screening

Test Marketing

Idea Generation

Commercializatio n

Stage 1: Idea Generation

Internal idea sources:
R

&D

Sales

force

External idea sources:

Customers,

competitors, distributors, suppliers

Sources of New-Product Ideas

Employees Customers Resellers Suppliers/ vendors Competitors Advertising agencies

Marketing research firms Other manufacturers International

Stage 2: Idea Screening Product development costs increase substantially in later stages. Ideas are evaluated against criteria; most are eliminated.

Stage 3: Concept Development and Testing Product concepts provide detailed versions of new product ideas. Concept tests ask target consumers to evaluate product concepts.

Stage 4:
Marketing Strategy Development Strategy statements describe: The target market, product positioning, and sales, share, and profit goals for the first few years. Product price, distribution, and marketing budget for the first year. Long-run sales and profit goals and the marketing mix strategy.

Stage 5: Business Analysis Sales, cost, and profit projections Stage 6: Product Development Prototype development and testing

Stage 7: Test Marketing Standard test markets Controlled test markets Simulated test markets

Standard Test Market Full marketing campaign in a small number of representative cities.

Controlled Test Market A few stores that have agreed to carry new products for a fee.

Simulated Test Market

Test in a simulated shopping environment to a sample of consumers.

Stage 8 Commercialization

New-Product Development Management

Top Level Support
Authority

Key Issues

Market-Guided R&D Integration & Coordination

Enough for today. . .

Summary

Packaging

Labeling

Product - Support Services

Companies should design its support services to profitably meet the needs of target customers and gain competitive advantage.

Product Line Strategies

New Product Development

Marketing Strategy Business Analysis

Concept Development and Testing

Product Development

Idea Screening

Test Marketing

Idea Generation

Commercializatio n

Next.
New Product Development (cont..)
Product Life Cycle (PLC)

MGT301 Principles of Marketing

Lecture-21