3Objectives Describe the steps in product planning Explain how to develop, maintain, and improve a product mix
4Product PlanningMaking decisions about what features should be used in selling a business’s products, services, or ideas.Decisions relate to features such as:Packaging, labeling, and brandingWarranties and support services
5Product Planning Allows Businesses To: Coordinate existing products and featuresAdd new productsDelete products that no longer appeal to customers
6Click on products to see Proctor and Gambles extensive product mix! All of the different products that a company makes or sells.A retailer’s product mix is made up of all the different products the store sells.Click on products to see Proctor and Gambles extensive product mix!
7Product Mix Kraft is another great example! Hundreds of products in 5 areas:SnacksBeveragesCheeseGroceriesConvenience MealsKraft’s key brands include: Kraft, Kool-Aid, Maxwell House, Nabisco, Oscar Mayer, and Post.
8Product MixAdding more products, may not result in increase sales, sometimes it can take away sales from existing products.Pepsi One takes away from Diet Pepsi salesThe type and number of products that a retailstore offers must be based on the image the business is trying to project and the market they are trying to reach
9Product LineA group of closely related products manufactured or sold by a business.related products of various sizes, types, colors, qualities, or prices.Example: range of desktop and laptop computers manufactured by Dell.Apple’s Product Line SecretOther great examples include all the car models produced by the Pontiac division of General Motors and all the cereals produced by Kellogg’s.
10Product ItemA specific model, brand or size of a product within a product line.Retailers generally carry several product items for each product line they sellMacy’s carries many styles and sizes of Guess Jeans for men, women, and kids
11Product WidthThe number of different product lines a business makes or sellsA retailer that sells three brands of jeans (Levi’s Lee, and Guess) has a product width of three
12Product DepthNumber of product items offered with in each product lineRed Lobster specializes in seafood dinners and has great depth within a narrow product line. You can order shrimp prepared 16 different ways.
13V.S. Width and Depth Product Width Kohl’s Department store stocks several brands of jeans: Lei, Levi’s, J-Lo, & Wrangler which demonstrates product width.V.S.Product DepthThe product depth is the number of sizes, price ranges, colors, and styles for each brand of jeans (Lei jeans have boot cut, flare, low rise, ankle etc).
14Gillette Product Mix Blades And Razors Toiletries Writing Instruments LightersMACH 3SensorTrac IIAtraSwivelDouble-EdgeLady GilletteSuper SpeedTwin InjectorTechmaticSeriesAdornToniRight GuardSilkienceSoft and DriFoamyDry LookDry IdeaBrush PlusPaper MateFlairP R O D U C T L I N E S ………….P R O D U C T L I N E SITEMSCricketS.T. Dupont
15Determining a Product Mix To determine its product mix, a business must:Identify its target marketIdentify its competitorsDecide on the image it wants to project
16Product Mix Strategies The plan for how the business determines which products it will make or carry1) Develop new product lines or add new products to existing lines2) Expand or modify current lines3) Drop existing products
17Key Steps in Product Development Screen IdeasStep 3Develop Business ProposalStep 4Develop ProductStep 5TestProductStep 6IntroduceProductStep 7EvaluateCustomerAcceptance
18Developing Existing Products Two ways of developing existing products are:line extensionsproduct modifications
19Line ExtensionsA different product that appeals to different consumersLine extensions add new product lines, items, or services.Tylenol Flu, Tylenol Cold, and Tylenol Allergy Sinus are line extensions of the original Tylenol Product.
21Product Modifications An alteration in a company’s existing productModified products may be offered in new and different varieties, formulations, colors, styles, features or sizes.Ask students what other modifications Oreo has madeBandAid is also a good product to discuss!Have them bring in Oreo modifications to share with the class.
22Write down as many Oreo product modifications you can think of. Sign up to bring an Oreo product modification to the next class!
23Deleting a Product or Product Line ObsolescenceLoss of appealConflict with current company objectivesReplacement with new productsLack of profitConflict with other products in the lineWhat products can you think of that are obsolete or have a loss of appeal?
24Activity Case Study New Coke Work with your table group to find an article online that discusses the introduction of this product and then answer the following questions:Why did Coca-Cola introduce New Coke and what were they hoping to accomplish?Explain the impact New Coke had on Coca-Cola Classic in the marketplace.What type of product mix strategy was Coke employing by adding this product to Coke’s product mix?Explain the success/failure/surprises encountered during this campaign.Write down the questions and your responses.Be prepared to discuss your responses as a class!We will move next door and talk about this at 1:00.Have students read the New Coke (Coke 1) case study and answer the accompanying questions. Discuss as a class.