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Product Management
Product management concerns three key areas:
The internal organization structure for managing current products.
The allocation of resources for developing new products.
Dealing with changing market conditions as products progress through their life cycles.
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2. Systems for Managing Products
An organization has several options or combinations of options for managing its product lines.
Brand Management: (Product manager)
Category Management
Regional Management
Target-Market Management
Continental and Global Management
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3. Brand/Category Management
V.P. Marketing
Category
Manager
Category
Manager
Brand
Manager
Brand
Manager
Brand
Manager
Brand
Manager
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4. Copyright © 2010 Pearson Education Canada
Regional Management
V.P. Marketing
B.C.
Ontario
Atlantic
Prairies
Quebec
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5. Target Market Management
Bell Canada
V.P. Marketing
Consumer
Small
Medium
Enterprise
Bell Mobility
V.P. Marketing
Youth
Women
Ethnic
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6. Continental/Global Management
V.P. Marketing
North
America
Europe
Australia
Latin
America
“Wherever possible U.S. strategies will be implemented in Canada.”
--Kraft Inc.--
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7. Product Management Decisions
All aspects of the marketing mix are managed to maximize profit. Key product decisions embrace:
Product Modifications
Product Mix (Stretching)
Brand Design and Packaging
Maintenance or Withdrawal
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Product modification
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Product Mix
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10. Brand Design and Packaging
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11. Maintenance or Withdrawal
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Product Life Cycle
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Product Life Cycle
Unique conditions in each stage of the life cycle necessitate different marketing strategies in each stage.
Introduction
Growth
Maturity
Decline
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14. Extending the Product Life Cycle
As products age the manager introduces rejuvenation (innovation) strategies to extend the life cycle.
Search for New Markets: Attract competitors customers, Entering new segments, Converting non users to users
Offer Product Improvements: Quality Improvements, Feature improvements, style improvements
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15. Extending the Product Life Cycle
Introduce New Lines: Different flavors or scents in order to try the product
Change Other Marketing Mix Elements:
Pricing
Advertising
Sales promotion
Distribution
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16. Extending the Life Cycle
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17. Extending: Add New Markets
There are several options for adding new markets.
Attract competitor’s customers
Enter new market segments
Convert non-users
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18. Extending: Alter the Product
Product improvements can refresh a tired brand; possibly give it a new look.
Improve the quality
Improve the features of the product
Improve the style (product design or package)
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19. Extending: Add New Lines
Depending on the product category numerous options are considered. Some examples:
New flavours or scents
Introduce new product format
Introduce new sizes
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20. Extending: Alter Other Mix Elements
Changes unrelated to the product itself can have an impact on sales at any stage of the life cycle.
Assess pricing strategy in context of competitors and consumer expectations.
Assess marketing communications strategies and reallocate budgets to more suitable activities.
Examine distribution strategy to make product available in new or non-traditional locations.
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21. Adoption and Diffusion
Stages a consumer passes through on the way to purchasing a brand regularly.
Adoption
Gradual acceptance of a product from introduction to market saturation.
Diffusion
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Stages of Adoption
Awareness
Consumer learns of product
Consumer receptive to messages and information
Interest
Consumer reviews benefits in relation to needs
Evaluation
Consumer makes initial purchase
Trial
Satisfaction results in ongoing purchases
Adoption
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Adopter Categories
Innovators
Early Adopters
Some people adopt a product quickly; others take much more time.
Early Majority
Late Majority
Laggards
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24. Product Life Cycle Length
Consumer acceptance has a direct impact on how long a product lasts.
Instant Bust
Fad
Fashion
Brand Acceptance Wall:
A barrier that stops most products from further consumer acceptance. It occurs due to lack of acceptance or uncoordinated marketing strategy.
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25. Product Life Cycle Length
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26. New Product Development
1. Idea
Generation
2. Screening
3. Concept
Development and Testing
7. Commercialization
6. Test Marketing
5. Product Development
4. Business Analysis
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