Chapter 5:

novation In agement Man BB10202 W

INNOVATION AND MARKETING

Innovation nt Manageme WBB10202

Introduction

-The customers` acceptance on innovative product. -Only special customer who is receptive to innovation. -Customers skeptical and wait for mass marketed.

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How to market innovative product

Educate customers about the problem. Explain how the product is different. Be authentic. Position the product as high-quality
alternative. Consider the impact of premium pricing.

Innovation nt Manageme WBB10202

What is Product?

- A product may be defined as everything (both favorable and unfavorable) that one receives in an exchange. It can be tangible good, a service, an ides or a combination of these things.

Innovation nt Manageme WBB10202

Consumer Product

- A consumer product is purchased to satisfy an individual`s wants. It can be classified on the basis amount of effort in the shopping process.

Innovation nt Manageme WBB10202

Consumer Product Classification

1. Convenience product
- An inexpensive item requires little shopping effort, products purchased regularly with little planning and require wide distribution.

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Consumer Product Classification

2. Shopping product - Requires comparison coz more expensive than convenience product and is found in fewer stores. - Consumers usually compare items across brands and stores.

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Shopping product

Homogeneous consumers see as

being the same and shop for the lowest price. Heterogeneous consumers to differ in quality, style, suitability and lifestyle compatibility.

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Consumer Product Classification

3. Specialty product search for extensively and substitutes are not acceptable.

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Consumer Product Classification

4. Unsought product a product that is known about or not actively sought by consumers.

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Product Failure

Not offer discernible benefit Poor match Overestimation of market size Incorrect positioning Incorrect pricing Inadequate distribution Poor promotion Inferior product

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Price

- An exchange to acquire a good or service. Related to the perceived value at the time of transaction and based on the amount of expected satisfaction to be received from the good and service.

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The Importance of Price to Marketing Managers

- Revenue and profit for the company. - High price = lost sales, low price = revenues not meet company`s goals Setting right price can be the most stressful and pressure-filled tasks Buyers are more efficient and better informed

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Place

Marketing Channels/Distribution - The set of interdependent organizations that facilitate the transfer of ownership as products move from producer to business user or consumer.

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Types of Channel Intermediaries

1. Retailers sell mainly to consumers. 2. Merchant wholesalers facilitate the

sale of product and services from the manufacturer to producers, resellers, government institutions. 3. Agents and brokers facilitate the sale of a product from producer to end user.

Innovation nt Manageme WBB10202

Promotion

- Is a communication by marketers that informs, persuades and reminds potential buyers of a product to influence an opinion or elicit a response

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Promotional Strategy

1. 2. 3. 4.

Advertising Public relations Sales promotion Personal selling

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Advertising

- is an impersonal one-way mass communication about a product or organization that is paid for by the sponsor.

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Public relations

- Is the marketing function that evaluates public attitudes, identifies areas and executes a program of action to earn public understanding and acceptance.

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Sales promotion

- consists of all marketing activities that

stimulate consumer purchasing and dealer effectiveness.

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Personal selling

- Is a situation in which two people communicate in an attempt to influence each other in a purchase situation.

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Advantages of Personal Selling

- Provide a detailed explanation or demo - Message can be varied by the salesperson Direct to specific qualified prospects Costs can be controlled Most effective in obtaining a sale and gaining satisfied customer.