Uw Product Management

7/28/2019 Uw Product Management

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Product Management

4/5/2013 RVS/ FoM/ Product Management

http://www.unitedworld.in/index.php



What is a product?


Anything that can be offered to a market

for attention, acquisition, use, or

consumption and that might satisfy a want

or need.Includes: physical objects,

services, events, persons, places,

organizations, ideas, or some

combination thereof.




Product(Idea, Good, or

Service)

• Attributes

• Quality

• Options• Style

• Sizes

• Services

• Warranties

• Returns

• Brand name

• Packaging

• Product Lines/Product4/5/20133

RVS/ FoM/ Product Management



What is a Service?

A form of product that consists of activities, benefits, or satisfactionsoffered for sale that are essentially intangible and do not result in

the ownership of anything.

Examples: banking, hotel, airline, retail, tax preparation, home

repairs.

Variable, perishable, inseparable from the provider





5

The Product-Service Continuum

Sugar RestaurantUniversityEducation

Pure Tangible Good Pure Service





7-6

Product and Service Attributes

Quality

Features

Style & Design

Performance and SatisfactionIncludes Level & Consistency

Differentiates a product from thecompetition; assessed based on

value and cost

Style = AppearanceDesign = heart of the product




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Supplies and ServicesOperating supplies, repair,and maintenance items

Materials and PartsRaw materials, manufactured

materials, and parts

Capital ItemsProducts that aid in

buyer’s production or operations

Industrial Products



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Individual Product Decisions





Levels of a ProductLevels of a Product

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brandname

quality styling

features

packaging

CoreBenefit

Product Levels

core

benefit

Basic,

expected,

and

augmentedproductInstallation

After-

sale

service

Delivery

and

credit

Warranty

4/5/201310




Discussion

Comparison of the Product Concepts of Full Service vs No Frills or Budget Airlines

The Evolving Product Concept in Coffee Marketing





Discussion

Product Mix width and Product Line depth- case of a computer company





ProductLine

Depth

Product Mix Width

Product Mix - Dell – Small Business Division Product Lines*http://www.dell.com/us/en/dhs/default.htm

WorkstationsLaptopsDesktops

Dimension

OptiPlex

Inspiron 3800

Inspiron 5000

Inspiron 7500

Servers

Latitude CP

Latitude CS

Latitude LS

Precision 220

Precision 420

Precision 620

PowerEdge 1300

PowerEdge 2400

PowerEdge 2450

PowerEdge 1300

PowerEdge 4400

PowerEdge 6400

PowerEdge 6450

PowerEdge 8450

*Partial4/5/201313


http://www.dell.com/us/en/dhs/default.htm

http://www.dell.com/us/en/dhs/default.htm



The Evolving Product Concept in Coffee Marketing

4/5/201314




Four-Level Structure of

Product Strategy

McGrath, 1995, Ch. 1

Vision

Product

Platforms

Product Lines

Individual Products

PrimaryStrategic

Levels

Platform Strategy Includes:

- What platforms to develop?

- How to develop them

- When develop them





Product Family Planning

Meyer, 1997, p. 27

Entry premium product(features/cost)

Entry mid-range product

(features/cost)

Entry low-end product

(features/cost)

Segment A Segment B Segment C

Shared Product Platform

Common Subsystems and Interfaces

High CostHigh Perf.

Mid-

Range

Low Cost

Low Perf.

Initial Platform Platform Extension Platform Extension



(features/cost)


(features/cost)



(features/cost)


(features/cost)

Product Platform




Introduction: 3G

Europe

Growth: 3G Asia

Mature:386/486 PCKenya

Decline: Analogue

Mobile Phones UK

International PLC

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DeclineMaturityGrowthIntroduction

Sales Low sales Rapidly rising sales Peak sales Declining sales

Costs High cost per Average cost per Low cost per Low cost per

customer customer customer customer

Profits Negative Rising profits High profits Declining profits

Customers Innovators Early adopters Middle majority Laggards

Competitors Few Growing number Stable number Declining

beginning to decline number

Characteristics





Create product Maximize market share; Maximize profit Reduce exp

awareness and trial sustain growth as long while defending share and milk the brandas possible.

General

Marketing

Objectives

4/5/201319





Product Offer a basic product Offer product extensions Diversify brands/models Phase out weak items

Price Try to use price/ Price to penetrate Price to match or best Cut price

value; Cost-plus frequent; market competitors

skimming vs. penetration

Distribution Build selective Build intensive Build more intensive Go selective: phasedistribution distribution distribution out unprofitable channels

Advertising Build product awareness Build awareness and Build preference; stress Reduce to level needed

among early adopters interest in the mass brand differences and to retain hard-core

and dealers market and benefits loyals

Sales Promotion Use heavy sales promotion Reduce to take Increase to encourage Reduce to

to entice trial advantage of heavy brand switching level

consumer demand

Marketing Mix

Strategies

4/5/201320


DeclineMaturityGrowthIntroductionCharacteristics



DeclineMaturityGrowthIntroductionSales Low sales

Costs High cost per

customer

Profits Negative

Customers Innovators

Competitors Few

Create product

Product Offer a basic product

Price Try to use price/value;

Cost-plus frequent;

skimming vs. penetration

Distribution Build selectivedistribution

Advertising Build product awareness

among early adopters

and dealers

Sales Promotion Use heavy sales promotion

to entice trial

Characteristics

General

Marketing

Objectives

Strategies




Product Life CyclesSales

Time

Effects of ExtensionStrategies

4/5/201322




Product Life Cycles

Sales/Profits

Time

PLC and Profits

PLC

Losses

Break Even

Profits

4/5/201323





Innovation Diffusion Process

Process by which an idea spreads from its source of invention to itsultimate users or adopters.






Customer Adoption Process

Awareness Trial Interest Evaluation

Aware,

lack

information

Adoption

Full,

regular

use





Types of Adopters

Time

34%

Early

majority

2.5%Innovators Early

adopters

13.5%

34%

Late

majority

16%

Laggards

4/5/201326





Designing Products with Customers in Mind

Quality Diffusion of innovations






What affects rate of Adoption

Complexity (L): …is difficult to understand/ use

Divisibility (T) …can be tried on a limited basis

Relative Advantage (A) …appears superior

Compatibility (C) …matches values/experiences

of the target group Observability(0) …its beneficial results are easily

observable/describable toothers






---------------------Industry?

The “promise”, image, company, name, package, andingredients are all part of the product, as are the stores where it

is sold.






7-30

Branding

Creating, maintaining, protecting, and enhancing products andservices.

A brand is a name, term, sign, symbol, or design, or a combination

of these, that identifies the maker or seller of a product or service.






7-31

Branding

Advantages to buyers:

Product identification

Product quality

Advantages to sellers:

Basis for product’s quality story

Provides legal protection

Helps to segment markets






7-32

Packaging

Designing and producing the

container or wrapper for a product.

Developing a good package: Packaging concept

Package elements

Product safety

Environmental concerns






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






Discussion

Product width and product line depth of a consumer appliancescompany


Product Mixes and Product Strategies of




Product Mixes and Product Strategies of

Consumer Appliance Companies

4/5/201335


P d t Li St t hi



Product Line Stretching

4/5/2013 36RVS/ FoM/ Product Management




7-37

Product Mix Decisions

Product Mix : all of the product lines and items that a particular seller offers for sale.

Width: the number of different product lines the companycarries.

Depth: the number of versions offered of each product in the

line. Consistency : how closely related the various lines are.






Product Positioning

How is a product or brand perceived in relation to the preferences of segments of the market, and in relation to competitive products

Example: Positioning for

Beer


strongWeak

Bitter

Sweet

xx

xxx

xxxx

xxx

xx

x

Market

gap





How value is added

Kotler’s 5 levels of Product benefit

Core benefits

Basic benefits

Expected benefits

Augmented benefits

Potential benefits

Discussion: Mobile phones

At what product benefit level does competition occur?






Copeland’s Product Classification

How to bring bring products to the market?

Convenience goods

Frequently purchased, low prices, low risk in purchase

Shopping goods

More expensive, of more interest to the customer, some risk in

purchase , customers will shop around, promo material should

have high info content

Specialty goods

Very differentiated, high levels of prestige, customers may insist

only on one brand, high levels of service required, high prices,

restricted distribution

Discussion: Examples?






Ansoff’s Matrix

Product-Market Scenario


Market Penetration

New Product

Product Development

Market Development

New Market

Existing

Market

Current Product

Diversification





Ansoff’s Matrix

Market Penetration: increasing sales of an existing product andpenetrating the market further.

Product Development: develop new products for the existing market.

Market Development: sell existing products to new markets.

Diversification: Moving away from what you are selling (your core

activities) to providing something new e.g. Moving over from selling foods to

selling cars.

Consolidation: Withdrawing from particular markets, scaling back on

operations and concentrating on its existing products in existing markets.


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