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1 Product Knowledge and Involvement 1. Hierarchy of Product Competition Generic Competition – Trade-offs between customer expenditure to different problems.

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Presentation on theme: "1 Product Knowledge and Involvement 1. Hierarchy of Product Competition Generic Competition – Trade-offs between customer expenditure to different problems."— Presentation transcript:

1 1 Product Knowledge and Involvement 1

2 Hierarchy of Product Competition Generic Competition – Trade-offs between customer expenditure to different problems that require a solution Class Competition – Different approaches to providing customer solutions to a common problem 2

3 Hierarchy of Product Competition (cont) Form Competition – Products perceived as addressing a problem in a similar way by providing comparable benefits Brand Competition – Products from an identified supplier that offers a particular value-proposition, set of options, and distribution system. 3

4 Levels of Product Knowledge Product Class Brand Product Form Model/Feature AutosSedan Sports Car Sports Sedan Ford Taurus Mazda Miata BMW Station wagon, Air & power steering Leather seats, Air & 5 speeds Model 325e, Air & Automatic Trans 1-pound can 8-ounce jar Folgers Maxwell House Ground Instant Coffee 4

5 Levels of Product Knowledge Product Class Brand Product Form Model/Feature BeerImported Light Low alcohol Heineken Coors Lite Sharps Dark Kegs 12-ounce cans Pens Ballpoint Felt tip Bic Pilot $0.79 model, regular tip $0.99 model, extra-fine tip 5

6 PRODUCT LIFE CYCLE STAGES OF THE DECISIONS PROCESS FOR INSTANT COFFEE MILLIONS OF POUNDS | | | | | | | | | | | 1948195019521954 1956 1958 19601962 196419661968 180- 160- 140- 120- 100- 80- 60- 40- 20- 6

7 IntroductionGrowthMaturityDecline SalesLowFast Slow DeclineGrowth Product Life Cycle Characteristics Profits Cash Flow Customer Description Number of Competitors 7

8 Product Life Cycle Characteristics IntroductionGrowthMaturityDecline Strategic Focus Marketing Expenditures Marketing Emphasis Distribution Intensity Price Product 8

9 Types of Product Knowledge 1.Bundle of Attributes - Tangible (concrete) or intangible (abstract) characteristics of the product Nike running shoes Arch support Tread design $89.95 Lacing pattern 9

10 Types of Product Knowledge 2.Bundle of Benefits - Consequences or outcomes when purchasing and using products & services (Functional, Psychosocial) Nike running shoes Long- wearing Stabilize heel Run faster 10

11 Types of Perceived Risk Benefit risks: 1.Functional 2.Physical 3.Financial 4.Social 5.Psychological 11

12 Types of Product Knowledge 3.Value Satisfaction - Cognitive representations of important broad life goals that consumers are trying to achieve Be physically fit Have good health Live a long life Nike running shoes 12

13 A means-end chain is a knowledge structure that connects consumers meanings about product attributes, consequences, and values. The means-end chain provides a more complete understanding of consumers product knowledge. The Means-End Chain 13

14 Attributes Functional Consequences Means-End Chains of Product Knowledge Psychosocial Consequences Values Level of Abstraction Less More 14

15 Means-End Chain Example: Gillette Sensor Razor ATTRIBUTES CONSEQUENCES FUNCTIONAL PSYCHOSOCIAL VALUES Spring suspension for twin blades Lubricating strip Close shave Be well groomed Smooth, soft shave Be comfortable Be attractive Relaxed Not stressed 15

16 Consumers Product Involvement The perceived importance or personal relevance of an object, event, or activity Involvement with a product or brand has both cognitive and affective aspects 16

17 Components of Involvement 1.Importance and risk (the perceived importance of the product and the consequences of a bad purchase) 2.Probability of making a bad purchase 3.Pleasure value of the product category 4.Sign value of self identify 1, 2, 3, 14 4, 5, 6, 7 8, 9, 10 11, 12, 13, 15, 16 17

18 Involvement Profiles of French Consumers (100 = average) NegativePleasureSign ConsequencesMispurchaseValueValue Detergents79825663 Dresses121112147181 TV Sets11210012295 Vacuum Cleaners1101127078 Champagne109120125125 Yogurt868310678 Facial Soap8290114118 18

19 Model of Consumer Product Involvement Consumer characteristics Product characteristics Environmental characteristics Time commitment Price Symbolic meanings Potential for poor performance Purchase situation Time pressure Social environment Physical environment Self-concept -- basic values, goals, needs Personality traits Expertise 19

20 Model of Consumer Product Involvement Consumer characteristics Product characteristics Environmental characteristics Intrinsic Self Relevance Situational Self Relevance Interpretation & Integration Processes Involvement 20

21 Factors that Influence Involvement Lower Involvement Higher Involvement (Toothpaste)(Automobile) Symbolic meanings FewMany regarding self: Social visibility of product Price: Potential harm to self and others Potential for poor performance: Time commitment to the purchase: 21


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