Date post: | 11-May-2015 |
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Product Positioning & Product Product Positioning & Product Life Cycle Life Cycle
Dr. Prashant MehtaAssistant Professor, National Law University, Jodhpur
Email: [email protected]
Product DifferentiationProduct Differentiation
Most competitive advantages lasts only a short time. Companies therefore constantly need to think up new value adding features and benefits to win the attention and interest of
choice rich, price prone consumers.
DifferentiationDifferentiation
It is the act of designing a set of meaningful differences to distinguish the company’s offering in terms of products
and services from competitors.
How can you differentiate?How can you differentiate?
Differentiation can be done in variety of ways depending on the industry, sector, product, and service category.
Differentiation can occur in one or more of these areas – product, product features, services, personnel, channel,
image and so on………………………………………...
Product DifferentiationProduct Differentiation
Form
Features
Performance
Conformance
Quality
Durability
Reliability
Reparability
Style
Design
Brand Image
Services DifferentiationServices Differentiation
Ordering Ease
Delivery
Installation
Customer Training
Maintenance and Repair
Service Contract
Miscellaneous Services like upgrade of Product or Feature
Information of New launches etc.
Personnel DifferentiationPersonnel Differentiation
Competence of Personnel
Courtesy
Credibility
Reliability
Responsiveness
Communication Skills
Channel DifferentiationChannel Differentiation
Trade Shows
Direct Channel
Online Channel
Indirect Channel
Image DifferentiationImage Differentiation
Identity – what the company wants to project
Image – what the public perceive
Image can be enhanced by using, symbols, media, atmosphere, events and employee behaviour
Relevant DifferentiationRelevant Differentiation
Differentiation must be meaningful and relevant to the consumer. So it should satisfy the following criteria:
Important Use
Distinctive Brand
Superior Quality
Affordable Price
Profitable to Company
Value to Customer
High Brand Value and Recognition
USPUSP
This product should be exclusive to the brand and make a significant relevant impact in the minds of
consumer.
It should ignite a passion of owing one.Eg: I Phone
PositioningPositioning
The act of designing the company’s offering and image to occupy a distinctive place in the consumer’s mind.
Positioning normally takes one position in the mind. More than one, the company runs the risk of customer credibility
and dilution of positioning.
Positioning StrategiesPositioning Strategies
Attribute
Benefit
Competitor
Use or application
User
Product category
Price /Quality
PLCPLC
Products have a limited life
Product sales pass through distinct stages
Profits rise and fall at different stages of the PLC
Product require different strategies in each stage of the PLC
The Product Life Cycle
Time
Sal
es o
r P
rofi
ts
Growth
Maturity
Decline
Introduction
Profit curve
Sales curve
Strategies - IntroductionStrategies - Introduction
Skimming the market
Penetrating the market
Must have sufficient resources to withstand the initial losses and heavy promotion costs
Incremental selling efforts at this stage is highest
The Competitive CycleThe Competitive Cycle
NewIntroduction
Growth ofIndustry
Excesscapacities
High Inventories
ReductionIn margins
New entrantsdiscouraged
Existingcompaniesconsolidate
Weakercompanies withdraw
Market Share Increases
Strategies - GrowthStrategies - Growth
Improves quality and adds features
Adds new models and variants
Enters new market segments
Increases distribution coverage and adds new channels
Shifts communication from awareness to preference building
Scale economies enable it to lower prices to attract the next level of price conscious buyers
Strategies - MaturityStrategies - Maturity
Most products are in this stage
Price wars are inevitable.
Scramble for market share
The fittest survive
Market modification, product modification, marketing mix modification can help extend the maturity stage
Strategies - DeclineStrategies - Decline
Withdrawal
Rationalization of Products
Harvesting whatever is possible
Divesting the Product
Removing it From Market
Market EvolutionMarket Evolution
Emergence
Growth
Maturity
Decline