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Lecture 7 - 30.09.2020
Lecture 7 - 30.09.2020
assignment 1, you have time till 11:59pm Week 7 Sunday, so do not get on
your high horse
•Lecture 7 content: We start with the first “P” of the marketing Mix, which is
product, PLC and product strategies. Note: New product development will be
covered in week 12 lecture. Stay focused
•Next week is mid-semester break: You guys deserve the break, so no studying
during the mid-semester break, eat, sleep and have fun, come back fresh after
the break.
•Break in between the lecture today: You guys and me will deserve a break for
5 minutes in between the lecture delivery content. Just knock me in and tell
me to stop , when you feel the need (Do not tell me to stop after 10 minutes
of listening)
LET’S GET STARTED WITH
TODAY’S LECTURE CONTENT
CHAPTER 8:
PRODUCT STRATEGY
AND NEW-PRODUCT
DEVELOPMENT
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution
permitted without the prior written consent of McGraw-Hill Education.
Product: The Heart of Marketing
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permitted without the prior written consent of McGraw-Hill Education.
What is a Product?
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Product Characteristics
• Tangibility
By nature of the products
• Durability
• Consumers
By who uses the products
• Businesses
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permitted without the prior written consent of McGraw-Hill Education.
Product Classifications by Nature of the
Product
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permitted without the prior written consent of McGraw-Hill Education.
Consumer Goods
Unsought Goods
Insurance
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution
permitted without the prior written consent of McGraw-Hill Education.
Product Classifications
Business Goods
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permitted without the prior written consent of McGraw-Hill Education.
Product Discrimination: Create a Point of
Differentiation
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Product Plan: Moving from One Product to
Many Products
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Product Decisions Affect Other Marketing Mix
Elements
Pricing
• Individual product pricing within the product line
• “good, better, best” product line strategy
• Technology companies face special challenges as newer
models have better features and lower prices
Marketing Communications
• Focus on a single product or the brand?
• Allocation of budget: Most popular products? Entire line?
New products?
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permitted without the prior written consent of McGraw-Hill Education.
Building the Product Experience
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permitted without the prior written consent of McGraw-Hill Education.
EXHIBIT 8.6 THE PRODUCT LIFE CYCLE
Reprinted from Roger Kerin, Steven Hartley and William Rudelius, Marketing, 9th edition, 2009.
PLC
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permitted without the prior written consent of McGraw-Hill Education.
PLC: Market Conditions
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permitted without the prior written consent of McGraw-Hill Education.
PLC: Introduction Phase
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permitted without the prior written consent of McGraw-Hill Education.
PLC: Growth Phase
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permitted without the prior written consent of McGraw-Hill Education.
PLC: Maturity Phase
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New Products Defined: Company
Perspective
Company Perspective:
• New-to-the-world
• Disruptive innovation are so innovative they create a fundamental
change in the marketplace (e.g., connected clothing).
• Sustaining innovations are newer, better faster versions of existing
products or additions to existing product lines (e.g., Diet Coke,
Coke Zero)
• Reposition existing products
• Add new market segments (e.g., cell phones from business usage
to adults to teens).
• Cost reduction
• Introduce lower-cost products with fewer features or scaled-back
warranty or service
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New Products Defined: Customer’s
Perspective
Customer’s Perspective
• The customer’s perspective is much more narrow
and self directed.
• The customer is most interested in an answer to
the fundamental question: Is this new product
new to me?
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permitted without the prior written consent of McGraw-Hill Education.
Why Do Products Fail?
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