PRODUCT DEVELOPMENT Evolving your product to stay ahead of the competition Gatorade - http://www.youtube.com/watch?v=nWAjioAfDW0 http://www.youtube.com/watch?v=nWAjioAfDW0 http://www.youtube.com/watch?v=NAtIZafyeHI Google Google Plus -http://www.youtube.com/watch?v=GRmDGvdkg8Ehttp://www.youtube.com/watch?v=GRmDGvdkg8E Health- http://www.youtube.com/watch?v=yNe6-p4G7Ikhttp://www.youtube.com/watch?v=yNe6-p4G7Ik http://googleblog.blogspot.com/2011/06/update-on-google-health-and-google.html http://googleblog.blogspot.com/2011/06/update-on-google-health-and-google.html Three keys to a successful product launch The right product The right timing The right people
THE RIGHT PRODUCT Make sure you have the best product before launching it INC: Dumb productshttp://www.youtube.com/watch?v=bvB5ZIbLirc Dads - productshttp://www.youtube.com/watch?v=_UppL6_sVNs Product must satisfy a need Must meet consumer expectations Must be produced at a profit
THE RIGHT TIMING If your product is seasonal, you will want to wait until the start of the selling season Replacing an old product, wait until merchandise is out before launching Food Saver- http://www.youtube.com/watch?v=SYJBNn0uAFk Food Saver - http://www.youtube.com/watch?v=jIlXtwjOjvM&feature=player_pr ofilepage
NEW PRODUCTS http://www2.kelloggs.com/ProductNew.aspx http://edisonawards.com/BestNewProduct_2011.php http://www.drinkcodeblue.com/http://www.drinkcodeblue.com/ - Which of the 5 suggestions do you think will work the best?
THE RIGHT PEOPLE People who buy new products, “early adopters” (Ipad 3)(Ipad 3) Pioneers of new products Late Adopters, cautious consumer Won’t try your product, simply because it’s new. Middle Adopters (80%) Must be convinced that your product is worthwhile, before buying. Need to tell them why “new” is better Must run lot’s of ads to tell people about your product. You have 6 months, to claim “new” After, show how well your product performs.
KEY TERMS –PG 5 Choose one of the following sections to read about: 1.Types of consumer products pg 308-310 2.Product Items, Lines and Mixes pg 310-311 3.Adjustments to Product Items pg 312-314 4.Branding pg 314-315 5.Branding Strategies pg 316-320 6.Packaging pg 320-323
COMPLETE THE FOLLOWING QUESTIONS AS A GROUP (EACH MEMBER NEEDS TO WRITE DOWN ANSWERS) 1.What is the name of your Section 2.What is the most important part of your section for a business leader to know? (Imagine that you only have 30 seconds in an elevator to convince someone this is important) 3.What is the Learning objective from this section? (After reading this section, what should everyone know?) 4.What are the key terms everyone should know from this section 5.Provide an example of a company that understands this Learning Objective Effectively 6.Provide an example of a company that failed to understand this Learning objective.
RE-SHUFFLE GROUPS! Each Member of your group will count off from 1-4. You will then form new groups of six- Each member will of the group will teach the other member about their section in a 3 minute presentation *Members should be completing their terms sheets during presentations.*
GROUP MIND MAPS. Using a piece of Presentation Paper, groups will create a Mind Map that represents the process of product development. The mind map should connect all of the terms and section notes.
NEW PRODUCTS Pick a Product from the Edison Awards Finalists and Answer the following questions. Send and e-mail to Mr. Fassl with your answer! http://www.edisonawards.com/BestNewProduct_2012.php 1.Do the product fill a need? 2. Is it the right time? 3. Can they make a profit? Explain. 4. Do you think they will be successful? Why or Why not?
FUTURE PRODUCTS…DIGITAL $$$ Jetsons The future of business What are three things that businesses need to do to be successful with customers in 2016. Complete your ticket!
Entrepreneurship- Imagine that you are going to open a retail clothing business.. Write down all of the decisions you will need to make
PRODUCT PLANNING Making decisions about features that are needed to sell a product Packaging, Branding, Labeling Product Mix All the different products that a company makes or sells. http://www.gm.com/vehicles/browseByBrand.html http://www.gm.com/vehicles/browseByBrand.html http://www2.kelloggs.com/Product/Product.aspx http://www2.kelloggs.com/Product/Product.aspx
PRODUCT LINE Group of closely related products manufactured and/or sold by a business All of the Chevy’s produced by GM All of the Cereal’s produced by Kellogg’s Product Item A specific model, brand or size of a product within a product line. Ex. Chevy Cruz, or Fruit loops
PRODUCT WIDTH/DEPTH Product Width Number of different product lines a business manufactures or sells Product Depth Number of product items within each product line.
Blades and Razors ToiletriesWriting Instruments Lighters MACH 3 Fusion Sensor Trac II Atra Swivel Double Edge Lady Gillette Super speed Twin Injector Techmatic Series Adorn Toni Right guard Clinical Strength Silkience Soft and Dri Foamy Dry Look Dry Idea Brush Plus Paper Mate Flair Cricket S.T. Dupont Depth of Product Lines 2001-WIDTH OF THE GILLETTE PRODUCT MIX
RazorsGel and skin car Body Wash Deodorant Fusion Proglide MVP Gamer Fusion Power Mach 3 turbo M3 power Venus Pro Series Aftershave Proglide shave gel Hydragel Foam FOAMY Body Wash Fresh + Clean Clinical Odor Shield Clear Gel Power beads Depth of Product Lines HTTP://WWW.GILLETTE.COM/EN/US/HOME.ASPX HTTP://WWW.GILLETTE.COM/EN/US/HOME.ASPX 2011-WIDTH OF THE GILLETTE PRODUCT MIX
PRODUCT MIX STRATEGIES Plan on which products to make or stock Different strategies depend upon resources and company objectives. Add new products Modify current products Delete existing products To make these decisions, you look at sales and current trends in the marketplace
NEW PRODUCT DEVELOPMENT Generate New Ideas Screen ideas Develop the product Test the product Introduce the product Evaluate customer acceptance
LINE EXTENSIONS Product Modification Altering an existing product New color, style, features, sizes, formula, variety. Usually the old product is phased out Often the packaging is modified to attract attention…. http://www.nabiscoworld.com/default.aspx http://www.nabiscoworld.com/default.aspx RITZ http://www.youtube.com/watch?v=zsAOGR365Uo&playnext=1&list=PL81E0AF4CA1407E44 http://www.youtube.com/watch?v=zsAOGR365Uo&playnext=1&list=PL81E0AF4CA1407E44 Pita Chips http://www.youtube.com/watch?v=CuQcWNim1Iohttp://www.youtube.com/watch?v=CuQcWNim1Io
DELETING A PRODUCT LINE Obsolete Lost it’s appeal Doesn’t match Co. objectives Make room for new product No longer profitable Conflicts with other products Pepsi Clear http://www.youtube.com/watch?v=Tign09D5IgEhttp://www.youtube.com/watch?v=Tign09D5IgE Cabbage Patch http://www.youtube.com/watch?v=H3lK8eZ3fN4http://www.youtube.com/watch?v=H3lK8eZ3fN4
LINE EXTENSIONS You are the manufacture of Stride. Visit stride’s website at stridegum.com You are to determine the next new “hot” flavor of gum to introduce. Name of Gum- “make sure it flows with the other flavors” Write an “introduction”
CONVENIENCE GOODS Goods that we just buy without thinking about price. Staple good – regular, routine purchases (bread, milk, etc.) Impulse Good – purchased on spur of the moment (magazine, candy, inexpensive products Emergency Goods –purchased as result of urgent need (gasoline, plumbing, ambulance)
SHOPPING GOODS Products that we spend time considering before making a purchase decision Usually more expensive than convenience goods Examples are: Clothing, houses, major appliances, stereo goods
SPECIALTY GOODS Will not consider buying anything else as a substitute. Favorite brand of jeans? Two factors – importance to customer - willingness to delay until specific product is located.
THE PRODUCT MIX All the different products that a company makes or sells. Could be over 100 Could be as few as 1
REVIEW: PRODUCT LINE A. All of the Products a company makes B. Groups of closely related Products C. Specific Items sold by a company D. I have no idea.
REVIEW: PRODUCTS Product Width – A. # of Different Lines B. # of Different Products C. # of Different Distributors D. # of different mixes company has E. I have no idea! Product Depth – A. # of Different Lines B. # of Different Products C. # of Different Distributors D. # of different mixes company has E. I have no idea!
THE PRODUCT LIFE CYCLE Growth Introduction Maturity Decline Deletion/ Rejuvenation Focus on Promotion and Production. Goal: Attract attention to product Special sales to get customers to try. Increasing sales. Advertising now focuses on customer satisfaction rather than new product benefits. Competition is now aware, and copying products. Introduce new models to stay ahead of competition. Maturity. Sales level off Spend Ad money fighting off competition. Advertising expenses climb. Must develop improvements to product to keep sales going Must tell how your product is better than competition. Decline: Sales Fall off. Profits are now lower… Cut advertising. Make Decisions regarding continuation of product. Rejuvenation: Must incorporate new strategies to keep product from failing. -Selling business -Licensing product -regionalizing, Modernizing -Altering(repackaging)
QUESTIONS TO ANSWER TO DETERMINE PRODUCT MIX What is the target market? What kinds of products do customer’s want? What products are competitors offering? How many product lines and product items are needed?
FUNCTIONS OF PACKAGING SellProduct ID InfoMeet custome r Needs Protect Cust. Protect the product Theft Red. Visual Appeal, Color Directions, Nutritional info, guarantee, warnings, instructions Better way to use product (Heinz, chips a hoy, medicine bottles) Glass plastic, Tamper- resistant Prot. From breakage Clamshell, better seals Bulk Size of packaging
LABELING Label - information tag, wrapper, seal, imprinted message that is attached to a product or package Two main functions Inform customers Directions for use
Contents of a label Brand Name ingredients directions promotional messages Most Food labels contain weight -dates illustrations -storage information manufacturers name & address universal product code (upc) guarantee
LABEL LAWS Federal Nutrition Act (1994) light, lite, free, low, reduced, good source provides consistent labeling for each requires nutritional information Care Labeling Rule 1972 care labels on textile clothing criteria for using “recycled content,” recyclable, degradable.
BRANDING – Brand name- group of words that can be spoken about a brand (Special K) Brand Mark – the symbol or design that identify a brand (K) Trade name – identifies the company (Kellogg’s) Trade character – brand mark that has been given human form, (dough boy)
TRADEMARK A brand name, brand mark, trade character or a combination that get legal protection. Kellogg’s Special K ® These elements combined are used to form a firm’s corporate symbol
BRANDING Why? Helps to assure customers of quality Identifies who manufactures product Helps introduce new products Customers are familiar with company Helps to establish a corporate image
TYPES OF BRANDS National – manufacture brands Generate majority of sales Customers - consistent quality, performance Generic – “No Frills” Don’t carry a brand name 30-50% less expensive Private – “store label” Quality and performance at lower price Large profits for retailers, customer loyalty
PRODUCT POSITIONING The efforts a business makes to identify, place, and sell its product in the marketplace Price and quality Features and benefits Unique Characteristics Relation to Competition Other products in product mix
POSITIONING BY PRICE AND QUALITY Ford Focus Economical, Fuel Efficient Ford Taurus Family car Safe, High Quality Porche High Priced, Sports Car Gives each car a unique position in the market place
BY FEATURES AND BENEFITS Ford Focus Ford Focus –What are their Unique Features? Oil of Olay Facial moisturizer and cleanser to keep skin soft and young Honda Odessy Features- Benefits? Mitsubishi EclipseEclipse
UNIQUE CHARACTERISTICS Goal is to set products apart from competition. Mighty PuttyPutty What’s unique about DELL computers? http://www.youtube.com/watch?v=WpaiTwAslsM
RELATING TO COMPETITION http://www.apple.com/getamac/ads/ Mac vs Pc Progresso – Vs – Campbell's Progresso http://www.youtube.com/watch?v=wj9myfIgpTM&feature=PlayList&p=318C2EC3F8351725&playnext=1&playnext_from=PL&index=83http://www.youtube.com/watch?v=wj9myfIgpTM&feature=PlayList&p=318C2EC3F8351725&playnext=1&playnext_from=PL&index=83 Campbells chunky http://www.youtube.com/watch?v=8syv6GupEXwhttp://www.youtube.com/watch?v=8syv6GupEXw http://www.youtube.com/watch?v=4sfAvBntndM The companies are trying get customers to believe that their product works better than competition. Which Product is Campbell's better than?Campbell's
RELATING TO OTHER PRODUCTS IN MIX Coke vs coke http://www.youtube.com/watch?v=pv8YgrqUCVUhttp://www.youtube.com/watch?v=pv8YgrqUCVU http://www.youtube.com/watch?v=_UzU7sQFZKo&feature=related New Ritz Chips How is it different than other products? Maxell HeadphonesHeadphones Classic Fashion Premium
POSITIONING CHECK http://www.youtube.com/watch?v=tKXoll6GaNQ http://www.youtube.com/watch?v=QyBOBntguPU FB http://www.youtube.com/watch?v=yylNWKoifgk&feat ure=related Quality http://www.youtube.com/watch?v=9mD9QqZnunY&feature=PlayList&p= 60B15B53B29EB6D2&index=7 Against other Products in Mix http://www.youtube.com/watch?v=xhiyDQNmEjY&feature=related http://www.youtube.com/watch?v=TnABZM83hqg Against Competition
CAN YOU “SEE” IT… If you look at the center of this logo, you can see two people enjoying a Tostito chip with a bowl of salsa. This logo conveys an idea of people connecting with each other 62
CAN YOU “SEE” IT First of all, the yellow swoosh looks like a smile: Amazon wants to have the best customer satisfaction. The swoosh also connects the letters a and z,meaning that this store has everything from a to z. 63
BRANDING/PRODUCT ARTICLES Read your Article as a Group Summarize it for the class Is it a good idea? Why or why not? How can this information make you more successful in business?
BEVERAGE PRODUCT LABEL Must Include the Following: Brand Name Nutrition Facts Ingredients Directions for use Weight (usually in FL oz) Dates (expiration or manufactured) storage information manufacturers name & address Universal product code (upc) Optional Items Guarantee Promotional messages Illustrations Website Consumer Contact Phone number Recycling Fees and discounts
STEPS TO CREATE YOUR LABEL 1.Measure the Circumference of the bottle You can cut off the existing label and trace it. 2.Layout a Box in Word You can use other programs such as publisher, Photoshop, and Fireworks NOT PAINT 3.Insert Graphics and additional Text Boxes as Needed