© 2009 South-Western, Cengage LearningMARKETING 1 Chapter 10 DEVELOPING SUCCESSFUL PRODUCTS 10-1Starting with a Product 10-2Components of Product Mix Elements 10-3Products for Consumers and Businesses 10-4New Products Development CHAPTER 10

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 2 Focus Questions: What is your initial impression when first seeing this ad? Why do you believe NTT Do Co Mo chose to use the image of the Roman aqueducts to introduce its new cell phone technologies? After studying the ad, do you understand the product being advertised? What additional information would you need to determine if you are interested in the company’s products? ©NTT DO CO MO USA, INC.

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 3 STARTING WITH A PRODUCT GOALS Explain how customers view products. Describe how marketers keep a consumer focus during product development. 10-1

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 4 A Product Is More It Appears More than a physical product Consumers know best

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 5 Product Development as a Marketing Function The role of marketing Marketing activities in product development Gather information Design strategies Conduct marketing test The product planning function

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 6 COMPONENTS OF THE PRODUCT MIX ELEMENT GOALS Describe the parts of the product mix element. Outline the three steps of the product design process. Explain the importance of product lines, packaging, and brand development. 10-2

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 7 Parts of the Product Mix Element Basic product Features Options Services Brand name Packaging Guarantee Uses

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 8 The Levels of Product Design Basic product Enhanced product Extended product

© 2009 South-Western, Cengage LearningMARKETING Chapter 10 9 Product Mix Components Product line Variation in quantity Variation in quality Product assortments Packaging Ease of use Safety Attraction Handling Environment Brand development

© 2009 South-Western, Cengage LearningMARKETING Chapter Levels of Brand Recognition Non-recognitionConsumers are unable to identify the brand. RejectionConsumers will not purchase the product because of the brand RecognitionConsumers can recall the brand name but it has little influence on purchases. PreferenceConsumers view the brand as valuable and will chose it if it is available. InsistenceConsumers value the brand to the extent that they reject other brands.

© 2009 South-Western, Cengage LearningMARKETING Chapter PRODUCTS FOR CONSUMERS AND BUSINESSES GOALS GOALS Define consumer markets and describe what is meant by direct demand. Explain the the importance of the business product classification system. Provide examples of how product classifications are used in product planning. 10-3

© 2009 South-Western, Cengage LearningMARKETING Chapter The Consumer Purchase Classification System The system is based on two factors: The importance of the purchase to the consumer The willingness of the consumer to shop and compare products before making the purchase

© 2009 South-Western, Cengage LearningMARKETING Chapter Classifying Products for the Consumer Markets Convenience goods Staple Impulse Emergency Shopping goods Specialty goods Attribute-based Price-based Unsought goods

© 2009 South-Western, Cengage LearningMARKETING Chapter Business Markets Capital equipment Operating equipment Supplies Raw materials Component parts

© 2009 South-Western, Cengage LearningMARKETING Chapter Planning Products for Consumer and Business Markets Need to know if the customer is the final consumer or a business consumer Some products are sold to both consumer markets and business markets

© 2009 South-Western, Cengage LearningMARKETING Chapter NEW PRODUCTS DEVELOPMENT GOALS GOALS Understand what businesses mean by “new” products. Describe the six steps in new product development. 10-4

© 2009 South-Western, Cengage LearningMARKETING Chapter What Is a New Product? Is it really new? Federal Trade Commission regulates the use of the term “new.” Entirely new or changed in an important and noticeable way Six-month time limit

© 2009 South-Western, Cengage LearningMARKETING Chapter The Steps in New Product Development Idea development Idea screening Strategy development Financial analysis Product development and testing Product marketing