4Unit 9 Essential Question What processes and techniques are used to develop, maintain, and improve a product/service mix in order to utilize market opportunities?
5Essential Question 1 Product Planning What is the nature and scope of the product/service management function?
6What is Product Planning? Product Planning: The decisions made about what features should be used in selling of a business’s products.These decisions relate to:guaranteesbrandingproduct mixpackaginglabelingwarranties
7What is Product Planning? Product Mix: All the different products that a company makes or sells.Product Line: A group of closely related products manufactured or sold by a business.Product Item: A specific model, brand, or size of a product within a product line.Product Width: The number of different product lines a business manufactures or sells.Product Depth: The number of product items in a product line.
8What is Product Planning? A well defined product plan allows a business to:Create sales opportunities.Design appropriate marketing programs.Develop effective advertising campaigns.Coordinate the product mix offered to customers.Add new products.Delete older products that no longer appeal to customers
9Essential Question 2 Product Planning How do businesses determine which products to produce and sell?
10Determining what to produce or sell Businesses will use different product mix strategies to determine what to produce or sell.Product mix strategies depend on:ResourcesObjectivesPast and current salesConsumer trends
11Essential Question 3 Product Planning How are products/services positioned in the market place?
12Product PositioningProduct positioning: Efforts a business makes to identify, place and sell its products in the marketplace.Positioning by price and quality:Ex: Ford Motor Company positions its Focus as an economical passenger car while still emphasizing quality.
13Product Positioning Positioning by features and benefits: Ex: Oil of Olay was positioned as a premium facial moisturizer and cleanser to keep skin soft and young.Positioning by unique characteristics:Ex: Cell phones that can text message or take pictures and send them.
14Product Positioning Positioning in relation to the competition: Ex: Warner-Lambert Company introduced Cool Mint Listerine by positioning against the “theraputic” benefits of Original Listerine and the “cosmetic” benefits of Scope.Positioning in relation to other products in a line:Ex: Binney & Smith introduced washable crayons and positioned them as a specialty item in the company’s Crayola crayon line.
15Essential Question 4 Product Planning What is the concept of product mix and product/service branding?
16Product Mix Strategies Developing New ProductsFollows six steps:Generate IdeasScreen IdeasDevelop a Business ProposalTest the product with consumersIntroduce the productEvaluate customer acceptance
17Product Mix Strategies Developing Existing ProductsLine Extensions: Adding new product lines, items or services.Ex: TylenolProduct Modifications: An alteration to an existing product:New and different varietiesFormulationsColorsStylesFeaturesSizes
18Product Mix Strategies Deleting a Product or Product LineObsolescenceLoss of AppealChanges in Company ObjectivesReplacement with New ProductsLack of ProfitConflict with other products in the line
19Essential Question 5 Product Planning What is the nature of product bundling?
20What is Product Bundling? Multiple products or components packaged together into one bundled solution.
21Benefits for Businesses and Customers Introduce New ProductsAcquire New CustomersHigher ProfitsIncrease Product Turnover (distressed inventory)
22Benefits for Businesses and Customers Save MoneyPerception of Greater ValueLow Risk to Try New Products
24Essential Question 6 Product Planning What is the nature of corporate branding?
25Branding, Packaging, and Labeling Brand: Name, design or symbol that identifies the products of a company.Brand Name:Word or group of words that can be spoken.Ex: Nike, Coca-Cola Classic, Cover Girl, TylenolBrand Mark:Symbol, design, distinctive coloring, or lettering
26Branding, Packaging, and Labeling Trade Name:Identifies the company or a division of a particular corporation.Trade Character:A personified brand mark.
27Branding, Packaging, and Labeling Trademark:When used, it is followed by the registered trademark symbol ®
28Branding, Packaging, and Labeling Package: Physical container or wrapping for a product.Label: Information tag, wrapper, seal, or imprinted message that is attached to a product or package.
30Essential Question 7 Product Planning How do you identify product opportunities?
31New Product Opportunities Changes in life cycleChanges in technologyChanges in market/societyChanges in economy
32Finding the GAPS! Find the opportunities when you find the gaps! Gap=the difference between what is currently available and what is needed/desired
33Changes in Life CycleProduct planning does not end when a product is new!Must decide what to do with existing products as they change through the life cycle
34Product Life Cycle Maturity Decline Growth Introduction Delete or ReinventWhat do we do when a product declines?Have to decide to modify or deleteTHIS IS AN OPPORTUNITY!
35Changes in Technology Smartphones GPS Social Media Voice recognition technologySiriGPSGarmin, Tom TomGoogle MapsSocial Media
36Changes in Market/Society Health ConscienceMcDonalds Happy MealApple Slices, MilkSalads, wrapsBottled waterConvenienceEntertainmentGames, music, movies, culture
37Changes in Economy Economic downturn Created opportunity for new product and product expansionGeneric brands, discount stores, low cost alternatives and substitutes
38Ways To Find the Gaps Market research Surveys Focus Groups Asking customers what they would like, what's lackingFocus GroupsSales recordsWhere are sales decreasing/not improving?CompetitorsWhat are our competitors offering that we aren’t?What are they doing better than us?
39Essential Question 8 Product Planning What methods/techniques can be used to generate a product idea?
40New Product Categories Products that create a new market or niche segment.Paper disposable diapers.Additions or line extensions to existing products.New flavors and new sizes of existing products.
41New Product Categories Product improvements.Cars.Cell phonesRepositioned products.Tums repositioned itself to feature its high calcium content as a benefit for women's health.
42Product DevelopmentThe first step is to generate new business ideas that are unique.Can the product beRepositionedImprovedBrought out in a new size, flavor, or package?
43Product Development Techniques used to generate new product ideas: Periodically screen your products and compare them with competitors' products, with an eye toward:improving attributes of productscombining the features/benefits of several separate products into a single new productexamining users' needs that are not being met by current competitive productsusing idea-generating methods like brainstorming