1. Amity Business School
AMITY SCHOOL OF BUSINESS BBA, II Sem PRINCIPLES OF MARKETING II Ruchika Jeswal

2. PRODUCT
AMITY SCHOOL OF BUSINESS
Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need.
A bundle of attributes,offering for use/ consumption by the final consumer.

3. Products that can be marketed include:
Physical goods
Services
Experiences
Events
Persons
Places
Properties
Organization
Information
Ideas

4. Three levels of Product:
AMITY SCHOOL OF BUSINESS
Three levels of Product:
Core Customer value
Actual Product
Augmented Product

5. Levels of product

6. What is the buyer really buying?
AMITY SCHOOL OF BUSINESS
Core Customer Value
What is the buyer really buying?
Marketer must define the core, problem-solving benefits or services that consumers seek.
E.g. Revlon lipstick, smart phone.

7. Actual Product
-turn the core benefits into an actual product. -develop product and service features, design, a quality level, a brand name, and packaging.

8. Augmented Products
Build around core benefits and actual product by offering additional consumer services and benefits.
Intangible component of the product along with formal and core components.

9. Product and service classification
Two broad classes based on the types of consumers who use them:
- Consumer products
- Industrial products

10. Consumer products – are products and services bought by final consumer for personal consumption.
Further classified as:
Convenience
Shopping
Specialty
Unsought

11. Convenience Product

12. Shopping Products are less frequently purchased.
Customer compare carefully on suitability, quality, price, and style.
Spend much time and effort in gathering information.
E.g. furniture, clothing, used cars, jewelery etc.

13. Specialty Products
Are products with unique characteristics or brand identification.
Willing to make a special purchase effort.
Less frequent purchase.
E.g.designer clothes, TVs , refrigerator, services of medical and legal professional.

14. Unsought products
Consumer does not know about or knows but does not think of buying.
E.g. life-insurance policies, blood donations, charity donations.

15. Amity Business School
Industrial Products
Are those purchased for further processing or for use in conducting a business. e.g. lown mover.
Three groups of Industrial Products:
I) Materials and parts
II) Capital items
III) Supplies and services.

16. I) Materials and parts
Raw materials and parts:
-Farm products (wheat, cotton, livestock)
Natural Products ( fish, crude petroleum, iron ore.
ii) Manufactured materials and parts:
Components materials ( iron, yarn, cement, wires)
Component parts ( small motors, tires, castings)

17. II) Capital Items Aid in buyer’s production or operations.
Installations
-buildings ( factories, offices)
- Fixed equipment's ( generators, drill presses, elevators, computer systems.
ii) Accessory equipment
Portable factory equipment and tools( hand tools , lift trucks)
Office equipment ( computers, fax machines, desks)

18. III) Supplies and Services
are convenience products
i) Operating supplies(lubricants, coal, paper, pencils)
ii) Repair and maintenance items ( paints, nails, brooms)
Business services include maintenance and repair services and business advisory services.

19. Product and service decisions.
Marketers make product and service decisions at three levels:
Individual product decisions,
Product line decisions and
Product Mix Decisions

20. Individual Product and Service Decisions
Product Attributes.
Branding
Packaging
Labeling
Product support services

21. Individual Product and Service Decisions

22. Product and service attributes:
Quality-”freedom from defects”
Features-
Style and design.

23. BRANDING Brand helps consumers:
Brand: a name, term, sign, symbol, design, or a combination of these that identifies the products or services of one seller or groups of sellers and differentiates them from the competitors.
Brand helps consumers:
Identify products
Product quality and consistency
Brand helps sellers:
Trademark provides legal protection
Helps to segment the market.

24. PACKAGING
It involves designing and producing the container or wrapper for a product.
It performs many sales tasks- from attracting attention, to describing the product, to making the sale.
Cos are using environmentally responsible packaging.

25. LABELING
Labels range from simple tags attached to complex graphics that are a part of the pack.
Functions:
Describes things
Promotion
Positioning
Connect with the customers.

26. Product Support Services
Support services which can be a minor or a major part of the total offering.
Services would be able to delight customers and add more profits.
Mixture of phone, , fax, internet and interactive voice and data technologies are now used.

27. PRODUCT LINE DECISIONS
A group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price range.
Major Product line decisions are:
Product line length
Line filling
Line stretching

28. Product line filling – involves adding more items within the present range of the line.
Product line stretching- occurs when a company lengthens its product line beyond its current range.
Downward stretching
Upward stretching
Both ways

29. Product Mix Decisions
The set of all product lines and items that a particular seller offers for sale.
Four important dimensions:
Width
Length
Depth
Consistency

30. PRODUCT LIFE CYCLE STAGES

31. PLC- The course that a product’s sales and profits take over a life time.
Not all products follow this PLC.
Some products are introduced and die quickly, others stay in the mature stage for a long time.
Some enter decline stage and are cycled back into the growth stage.

32. Four Stages
Product Development
Introduction
Growth
Maturity
Decline

33. Introduction
A period of slow sales growth as the product is introduced in the market.
New product is first launched.
Sale growth is slow.
Profits are negative or low because of low sales and high distribution and promotion expenses.
Promotion spending high.
Few basic versions are introduced.

34. GROWTH
A period of rapid market acceptance and substantial profit improvement.
Sales start climbing.
Early adopters continue buying, later buyers follow.
New competitors enter.
Market expands as new features are introduced.
Profits increase as promotion costs are spread over a large volume.

35. MATURITY
A period of slow down in sales growth because the product has achieved acceptance by most potential buyers.
Sales growth slows down or levels off.
Greater competition.
Competitors mark down the prices, increasing advertising and sales promotions, product development increases to find better versions of the product.

36. Marketers can do any of the following :
Modifying the market.e.g.Moov
Modifying the product.e.g.cars
Modifying the market mix. changes in any Ps.

37. DECLINE
PLC stage in which a product’s sales decline. e.g. cassette , VHS tapes.
Many reasons:
Technological advances
Shifts in consumer tastes.
Increased competition.

38. New Product Development
The development of original products, product improvements, product modifications, and new brands through the firm’s own product development efforts.
90% of new products fail why?
Poorly designed
Incorrectly positioned
Launched at a wrong time.
Priced too high.
Poorly advertised.

39. Steps of New Product Development
Lay
Future
Plans
yes
yes
yes
yes
yes
yes
yes
yes
1. Idea
Generation
2. Idea
Screening
3. Concept
Development
& Testing
4. Marketing
Strategy
Development
5. Business
Analysis
6. Product
Development
7. Market
Testing 8.
Commercial
ization
yes
yes No No
Send the idea
Back for
Pdt. Devt.
Modify the
Product or
marketing
program? No No No No No No No No
Drop

40. Idea Generation The systematic search of new product ideas.
Internal sources: formal R&D, employees.
External sources: Distributors and suppliers,Competitors,customers.

41. Idea Screening
Screening new product ideas in order to spot good ideas and drop poor ones as soon as possible. -company wants only those ideas which will turn into profitable products.

42. Concept Development and Testing
A product idea must be developed into a product concept.
Product concept – A detailed version of the new-product idea stated in meaningful consumer terms.
e.g. battery powered all-electric car
Concept Testing – It calls for testing-new product concepts with groups of target consumer.

43. Marketing Strategy Development
Designing an initial marketing strategy for a new product based on the product concept.
Three parts:
Target market
Planned value proposition.
Sales, market share and profit goals.

44. Business Analysis
A review of the sales, costs, and profit projections for a new product to find out whether these factors satisfy the company’s objectives.
Look at the sales history of similar products.
Conduct market surveys.

45. Product Development
Developing the product concept into a physical product in order to ensure that the product idea can be turned into a viable option.

46. Test Marketing
The stage of new-product development in which the product and marketing program are tested in realistic market settings.
Three approaches:
Standard Test Markets
Controlled Test Markets
Simulated Test Markets.

47. Commercialization Introducing a new product in the market.
Introduction timing
Where to launch the product?
Planned market roll out.