Developing Successful Products Brandon Burton Greg Zankowsky Melina Blundetto

Students will know:  How customers view products  How marketers keep a consumer focus during product development  The parts of the product mix element  The three steps of the product design process  The importance of product lines, packaging, and brand development  Consumer markets and what is meant by direct demand  The importance of the business product classification system  What businesses mean by “new” products  The six steps in new product development

How customers view products  Concerned about their needs  View products as a way to satisfy these needs  The physical characteristics of a product are important  Durable, attractive, and safe  A customer’s need vary  Variety, quality, service, location, price, etc.

How marketers keep a consumer focus during product development  Gather Information  Evaluating marketing study  Interpreting results to assist in product planning  Keeps focus on consumer needs  Design Strategies  Identify target market  Determining company strengths and weaknesses  Evaluating existing and potential competitors  Conduct Marketing Tests  Determine whether if a new product will be successful  Reduce project failures

The parts of the product mix element  Offering choices  Variations  Offering a guarantee  Persuade customers to switch products  Testimonial  Recommendations

The three steps of the product design process  Basic Product  Simplest form  Easily identified and used  Similar to competition  Modifications and Improvements  Features and options  Changes the basic product  Increases satisfaction  Services and complementary products  Services, guarantees, information on effective use of the product, and additional products that improve the use of the primary product  Meet additional customer needs  Improve customer satisfaction

The importance of product lines  Product line  A group of similar products with slight variations in the product mix to satisfy different needs in a market.  Variation in Quantity  Expanding from one product to many products.  Having more choices for customers  Variation in Quality  Adding features to basic products may produce several levels of product choices that vary in quality  Basic products may be lower in price  Having a featured product may increase in price.  Product Assortments  The complete set of all products a business offers to its market.

Importance of Packaging  Dual purpose of protection and promotion  Improves the use of the products  Solve customer problems related to the use of the product  Safety and Protection  Attractive  Convey an image

Importance of Brand Development  Name, symbol, word, or design  Provides a unique identification for the company  Part of the purchase decision  Gain customer recognition  Increase likelihood of a sale  Convey a particular image that can be recalled

Consumer markets and what is meant by direct demand  Consumer Market  Individuals or socially related groups who purchase products for personal consumption  Direct Demand  The quantity of a product or service to meet the needs of the customers  The demand for consumer products.

The importance of the business product classification system  Capital Equipment  Land, buildings, and major pieces of equipment.  Most expensive and most important products purchased.  Meet specific needs in order to operate successfully.  Operating Equipment  Tools, small machines, and furniture.  Makes production and operations efficient and effective.  Supplies  Paper, pencils, paper clips, cleaning supplies, and parts for equipment repair.  Can include minor and major expenses for company.  Standardized

The importance of the business product classification system (con’t)  Raw Materials  Components used to produce a companies products.  Adequate supply and equal quality of production.  Component Parts  Parts of a businesses products that have been partially or totally produced by another company.  For example: computer manufacturer buys computer chips from another company..  Designed for needs of one company

What businesses mean by “new” products  Changes and improvements to an existing product  Products that are new to a particular market  A product can be called new for only six months after the introduction or change of a product  A new use for a product can be discovered

The six steps in new product development  Idea Development  Ideas for new products  Consumer Problems  Creative Process  Idea Screening  Evaluate Ideas  Select those that have the greatest chance for success  Develop criteria  Strategy Development  Create and test a sample marketing strategy  Clearly identify an appropriate target market and ensure that customers exist with the need and money for the product

The six steps in new product development (cont.)  Financial Analysis  Costs of production and marketing, sales projections for the target market, and resulting profits are calculated  Product Development and Testing  Design the product process  Obtain needed equipment and materials  Training personnel  Product Marketing  Full scale introduction into the market

Key Terms  Product  Anything tangible offered to a market by a business to satisfy needs  Product line  A group of similar products with slight variations in the product mix to satisfy different needs in a market  Product assortment  The complete set of all products a business offers to its market  Trademark  The legal protection of the words or symbols for use by a company  Licensed Brand  A well-known name or symbol established by one company and sold for use by another company to promote its products

Key Terms Cont.  Consumer Markets  Individuals or socially related groups who purchase products for personal consumption  Direct Demand  The quantity of a product or service needed to meet the needs of the consumer  Business Markets  Companies and organizations that purchase products for the operation of a business or the completion of a business activity  Derived Demand  The quantity of a product or service needed by a business in order to operate at a level that will meet the demand of its customers  New Product  A product that is entirely new or changed in an important and noticeable way