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PRODUCT MARKETING

PRODUCT MARKETING. PRODUCT LEVELS. AUGMENTED. ACTUAL. CORE. Adapted from Kotler, 1994. TYPES PRODUCTS:. Convenience goods — e.g., Shopping goods -- e.g., Specialty goods - e.g., Unsought goods - e.g.,. WHAT ARE THE IMPORTANT PARTS OF YOUR MIX?. Convenience good Why?

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PRODUCT MARKETING

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  1. PRODUCT MARKETING

  2. PRODUCT LEVELS AUGMENTED ACTUAL CORE Adapted from Kotler, 1994

  3. TYPES PRODUCTS: • Convenience goods— • e.g., • Shopping goods-- • e.g., • Specialty goods - • e.g., • Unsought goods - • e.g.,

  4. WHAT ARE THE IMPORTANT PARTS OF YOUR MIX? • Convenience good • Why? • Shopping good • Why? • Specialty good • Why? • Unsought good • Why?

  5. sales Product Life Cycle • Products have limited lives, so ______________ • Products pass through different stages--each with different appropriate marketing strategy implications and profitability, so _______________ • Shape varies! Sales & profits profits intro growth maturity decline

  6. Why Is There a PLC? • Adoption Process • Diffusion Process

  7. THE ADOPTION PROCESS AWARENESS INTEREST EVALUATION TRIAL ADOPTION

  8. The Diffusion Process innovators early early late laggards adoptors majority majority What is missing? What are some of the problems with this?

  9. Now, put it together! Intro Growth Maturity Decline Sales Profits Comp Tgt. mkt.

  10. Two Mini-cases--Just Do Them! • What stage in the product life cycle is this product in? • Who do you think should be the target market (think about diffusion!) • Develop an appropriate marketing objective. • Outline an appropriate strategy.

  11. Mini Case 1: Your R&D department has developed a completely revolutionary way to take notes in the classroom. The product is named “Wilbor”—a short name for “WILLingly takes BORing notes.” To use the product, an individual wears a headphone. Everything that s/he thinks that is addressed to the computer is recorded onto a 51/2 inch diskette. For instance, the EMBA students might think, “Oh dear, I better remember what the early majority is,” so the student thinks, “Wilbor record that the early majority is about 34% of adopters. Consumers in the early majority make deliberate decisions and have many social contacts. End Wilbor.” The electronic record is compatible with Microsoft Word. The student simply puts the diskette into a disk drive and prints out detailed, legible notes. To your knowledge, no other firm can offer this product.

  12. Mini Case 2: Your R&D department has developed a better way to make banana bread from a mix. The new mix includes all dry ingredients and a special package of banana puree (that does NOT turned that brown disgusting color) mixed with vanilla extract. This package is to be added to the mix prior to baking and results in a more “bananay” taste and a moister bread. Secondary sources suggest that sales of banana bread mixes have been experiencing slow growth during the past few years. Competitors include Betty Crocker, Pillsbury, Martha White and Jim-Dandy.

  13. Definition Time! • Product mix-- • total assortment of product offerings • Product line • --group of individual products that is ________ related - designed to meet a single need • width--number of product lines • length-number of products in a line • consistency-how closely related the product lines are

  14. 1. Cinnabuns offers only two types of buns--regular and miniature. 2. AT&T goes into the chocolate business. 3. Tootsie Rolls, Inc. makes only one thing--Tootsie Rolls. 4. The Body Shop offers 20 different types of lotion, each with 7 fragrances. 5. AT&T offers a low-priced phone service (Lucky Dog Phone Co.). 6. ACME makes many different types of products--dynamite, electronics, foods, vehicles, etc. a. High consistency b. Low consistency c. Wide line d. Narrow line e. Long line f. Short line Matching

  15. Expansion is important to a firm! • How to Expand: • downward stretch • upward stretch • two-way stretch • line-filling • Cannibalization

  16. SERVICES MARKETING

  17. Important facts about services in the US • Demand for services is increasing: • consumers are VERY busy • consumers have discretionary income • companies are outsourcing • technologies make more services available • Services are making up a (larger or smaller) part of our GDP.

  18. SERVICE CHARACTERISTICS • INTANGIBLE • PERISHABLE • INSEPARABILITY • VARIABILITY

  19. Nature of Services vs. Products Goods Services Client Relationships Perishability Tangibility Separability Customer Effort Uniformity

  20. Environmental Influences on Services • Economic • Political/legal • Social • Technological

  21. Services Pricing • Make sure everyone knows what is included in the price. • Price-->Quality connection • Pricing to influence demand

  22. Services Promotion • Consumers rely on personal sources for information. • Must detail what the service is. • Must communicate benefits.

  23. Services Placing • Facility location should be: a. Close to the customer. b. Close to the suppliers. c. It depends.

  24. Think about: • Your really good service experience: • Your really bad service experience:

  25. Good experiences include: Bad experiences include: What factors make a good/ bad service experience?

  26. Managing Service Quality Perceptions • Tangibles -- • Price Cues • Responsiveness- • Empathy- • Assurance-

  27. Managing Aspects of Products & Services • Positioning • Branding

  28. POSITIONING • Definition:

  29. PERCEPTUAL MAPPING • PAIRWISE COMPARISONS • MAP SIMILARITY DATA e.g., compare: 1. Pittsburgh 1 & 2 2. Baltimore 1 & 3 3. Los Angeles 2 & 3

  30. Heineken • Lowenbrau • Michelob • Michelob Light • Coors • Coors Light • Bud • Bud Light • Strohs • Miller Light • Natural Light • Miller • Hamms • Oly Gold • Rainier • Hamms Light • Schlitz Malt Liquor • Rolling Rock • Rolling Rock Light • Generic Light • Generic

  31. POSITIONING IMPLICATIONS

  32. Branding Provides the recognition factor for products/services • Brand name- • Logo (Brand mark)- • Trademark--

  33. Selecting a brand name • Tells about product benefits • Easy to remember, pronounce, read, and spell • Can be translated into other languages • Distinctive in some way

  34. Brand Strategies • BRAND EXTENSIONS Advantages: Disadvantages: • NEW BRAND Advantages Disadvantages • CO-BRAND (associative branding)

  35. Branding • How important is a brand name? • NOT VERY 1 2 3 4 5 6 7 VERY • WHY? • from consumers’ viewpoint • from firms’ viewpoint • Brand image-- impression consumer has of brand • Brand loyalty-- commitment and repeat purchasing of brand • Brand equity-- value of brand in marketplace; financial qualities of brand from firm’s perspective

  36. BUILDING BRAND LOYALTY BRAND RECOGNITION BRAND ACCEPTANCE BRAND PREFERENCE BRAND LOYALTY

  37. Brand Loyalty Brand Equity LEADS TO: 1. 2. 3. 4.

  38. Pricing Preparation • Talk to a small business owner/manager or someone in your company who is responsible for determining prices. • Ask the following questions: • 1. How do you set your prices? What things do you consider? • 2. What causes you to change prices? When is the last time you changed a price(s)? • How do you know if the price is “right”? We’ll talk about this in the next class.

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