MKTG 311 1st Edition Lecture 14 Outline of Last Lecture I. Selecting the Target Market: 4 ApproachesII. Step 3: DifferentiatingIII. Step 4: PositioningIV. Value PropositionsV. Chapter 10 & 11: The Product- Layers of the Tangible ProductVI. Classifying Consumer ProductsOutline of Current LectureI. Classifying Consumer ProductsII. Classifying Business ProductsIII. Key Concept: Product MixIV. Key Concept: Product Line & Other TermsV. Product Line ExtensionsVI. The Product Life CycleVII. The PLC as it applies to Basic Products, Fashion Products and Fad ProductsCurrent LectureI. Classifying Consumer Products- Shopping products- Consumers do spend some time and effort comparing the product on the basis of price, attributes, and quality.- Limited problem solving decision 2 Characteristics:1. Attribute based shopping product: Consumer companies based on selection. Example- New dress, suitThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.2. Price based shopping product focus: Price, we will compare several options based on price. Example- book- Specialty products- Unique characteristics that are important to buyers at anyprice. Loyal to specific brands and extended problem solving decision (much time and effort). Example- Big Screen TV- Unsought product- Little awareness or interest in this product until a need arises, Marketers need to encourage interest. Example- Insurance II. Classifying Business ProductsSupport Goods:- Installations- Buildings and machinery- Accessory Equipment- Tools and office equipment- Supplies- Paper, light bulbs- Services- Technical (equipment repair) non-tech (legal and marketing services)III. Key Concept: Product Mix- Product Mix: Total array of product offering produced by a company (the width), number of product lines produced by a company. Example- Lazyboy: Sofas, chairs, sectionals etc.IV. Key Concept: Product Line & Other Terms- Product Line: Total product offerings designed to satisfy a single need. Example- Lazyboy-Rockets- Full Line: Large number of variations in the product line- Limited Line: Fewer Variations in the product line, specialistV. Product Line ExtensionsDownward Stretching: Add lower priced items to product lineUpward stretching: Add higher priced items to product lineTwo-Way: Add higher priced and lower priced items to the product lineFilling out: Adding sizes and styles that were not previously availableContracting a product line: Drop products that weren’t as profitableVI. The Product Life CycleIntroduction Growth Maturity DeclineCompetition and ProductSingle companyproduces a single productCompetitors begin to enter the market. Product variations are introducedIntense competition and many product variationsFewer competitors, none with a distinct competitive advantagePrice Company may enter market with a high price (skimming) to recover research and development cost. Company may enter market with a lower price (market penetration) to build market sharePrice competition occursPrice reductions occurCompany may continue to reduce the price if it can remain profitablePromotion Massive advertising goal: Increase primary demand. What is this product?Teaser advertising, Focus: Selectivedemand (selectmy product over the competition)Reminder advertising (remind consumers why they love our product)Little to no advertisingPlace (Distribution)Start with a small number of outletsIncreased number of retail outletsSell product in as many outlets as possibleFewer outlets availableVII. The PLC as it applies to Basic Products, Fashion Products and Fad ProductsFad: Short-Lived product “Here today, gone tomorrow”. Example- pet locks 80’sFashion Product: Whatever is the popular style of the year.Basic Product: Spent the most time in the maturity phase of the product lifecycle. *Never goes out of style. Example- Polo’s, Khaki,
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