MKTG 300 03 30 15 Product Products are core needs satisfiers Goods services etc Total product concept What is a product What does it mean What is it all about Examine the total product concept 1 The tangible product functional and aesthetic features of a product 2 Augmented product changed in some way Service and image extras Brand image 3 Generic product psychological and operational benefits of the product How does it make you feel 4 Packaging A lot of the time we as consumers pay more for the package than the good inside Packaging plays a tremendous role in the over all product strategy Packaging plays into the above three points Extra credit exercise choose a packaged good and evaluate the package of it using packaging functions Packaging functions 1 Product protection protects the quality of the product from breakage leakage spoilage etc 2 Attention How attention getting is this package Will this package grab my attention 3 Di erentiation does it look like everything else or does it set itself apart 4 Target marketing Good packaging flags the target market Appeals in its imagery to who it s for 5 Information disclosure 6 Safety liability duty to warn about foreseeable danger 7 Environmental concerns Is the package environmentally friendly Biodegradable Ozone etc 8 Cross promotion two non competing products attempting to reach the same target market by working together O ering coupons shared advertising etc 9 Additional package uses can you use the package for anything else when you re done with it Collectors glasses alternative uses etc 10 Innovation ex packaging that keeps drinks cool portability easy open etc Portfolio Items and lines BCG grid Relative market share relative to your closest competitors v Market Growth Cash cows mature products high market shares low growth Campbells soup High STARS High growth and market share Burts Bees Dogs problem children Low growth low market share Crystal Pepsi Strategy alternatives Question marks growing but low market share Low 1 Market penetration take current products go after current markets Take current products you have and target growing markets 2 Market development strategy take current products go after new markets As a product matures and current markets get saturated find new markets Ex international markets choosing a di erent demographic etc 3 Product development strategy Develop new products go after the current markets you serve 4 Diversification New products new markets 5 Audio File New product development process 1 Idea generation It takes hundreds of ideas to come up with a success Quantity vs Quality How much marketing research is dedicated to idea generation Sources for idea generation customers employees channel members ex walmart coming up with ideas for products they want companies to sell Govt agencies ex US patent o ce competitors 2 Screening Get top management involved Get evaluation criteria does the idea have a good strategic fit 3 Concept testing testing for adoption and di usion determinants Adoption Awareness interest trial adoption Ex email When an entire society adopts something it becomes DIFFUSED Determinants 1 Relative advantage perceived superiority How does it have an advantage over what you use already 2 Complexity Do people perceive it to be complex How do we make it more user friendly 3 Compatibility Refers to how compatible the new product is with your existing behavior patterns values and lifestyles 4 Trialability can this new product be tried on a risk free basis Is it dangerous 5 Cost What is an acceptable price range Don t make something too expensive 4 Business analysis put all of this in report form 1 Break even analysis how many can you sell to break even 2 Is there market potential 5 Development limited production testing with actual products 1 Alpha testing function durability safety cost 2 Beta testing Testing with the consumer in a private setting 6 Test marketing optional selective pilot tests of a product Pick large cities to market product and see how people react to the product Pros Cons Higher costs Takes time Competitive exposure Good sales forecasting Target market analysis Marketing mix experimentation Looking at consumer purchase patterns Cannibalization e ects does your new product eat away sales of your existing product Competitive response how do your competitors react Opportunity for consumer feedback Finally you get to commercialization The launching of the full scale product Audio File