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Product Concepts

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by

Ralph Corbett

on 23 July 2013

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Transcript of Product Concepts

Chapter 10
Product Concepts
Ralph Corbett
A product is a good, a service, or an idea.
It is tangible or intangible and includes functional, social, and psychological utilities or benefits.
They include support services, such as installation, guarantees, product information, and promises of repai maintenance
Without a product, there is nothing to sell.
is the products main use.
Supplemental features are not required to make the core product operate.
or attributes of the product; the other stuff.
They are nice though
Personal wants Business goals
These classifications will affect how the marketing mix, PPPD,
is altered to cater to a select target market
http://tunein.com/radio/Frisky-Radio-s2107/
Click this for cool music
Make selection at top
Convenience Products
Every retail store carries them. Product sells itself.
Shopping Products
Shoppers expend considerable effort in buying these. Purchased less frequently.
Specialty Products.
Shoppers see these as one-of-a-kind and will accept nothing else.
Unsought Products
Consumers are presented with a sudden problem requiring a purchase i.g., Flat tire, fire damage, laptop stolen.

- Product will be purchased even thought consumer does

- Seeks out closest and cheapest in area.
Business Products
Accessory equipment
Installations
office buildings, factories, product line, large machines
not part of product, used in making it.
Tools, storage lockers, two –way radios
Raw Materials
parts used in making the finished product. Easily identified.
om
What the product eventually becomes.
Process Materials
product. Cannot readily identify these.
Cleaners, rags, paper, pens, buffer equipment.
MRO Supplies
Departments. Marketing, advertising, accounting,
Business services
LEGAL
Product line
a group of closely related product items
Rubber rain coat
a specific version of a product
Product item
Rubber Fireman’s coat
All groups of products a company makes
roduct mi
Width and depth
of product mix
number of product
W i d t h
D e p t h
average number of products contained within a
product line
Product Life Cycle
Introduction stage
Growth stage
Maturity stage
Decline stage
Introduction stage
Product is unknown as introduced to market
Advertising expenses are high
Sales = 0
profits = -negative
Manufacturing expenses are high
stage
Consumers now aware of product
or caught off guard
Sales = high
profits =
competition = 0
Products price dropping as initial manufacturing cost is recouped and better manufacturing methods are discovered
Consumers very knowledgeable about product
Maturity stage
Weaker competition
Sales = decline
Profits =
Product’s quality improves to make different from competition
Laptop computer can now be used as cat bed.
Alternative uses for product.
NEW!!
Decline stage
Consumers lose interest in product.
Sales and profits returning to initial level = 0
Dust in the wind. All we are is dust in the wind….
less
Inventory sold to outlets at cheaper prices to consumer
Decline stage
v2
Companies stop promotions, advertising, customer support.
Harvesting – slowly withdraw support
Divesting – stop all support at once – “Off with its head!”
Marketers must keep track of new, intermediate, and declining products all at once.
Product adoption process by consumer
Acceptance of new products
Awareness

Interest

Evaluation

Trial

Adoption
Buyer sees product
Product seeks information about product
Buyer considers purchasing; examines benefits
Consumer tries a free sample or trial size
Product is purchased and will be done so again when need arises
Innovators

Early adopters

Early majority
Business products – used to resell or make other products
Consumer products – personal and family needs
Satisfying
x
Shoes
Laptop computer
(always in pairs)
Shoes
Few retail outlets.
Advertising is required to sell.
A reward for much
Shopper must hunt for a store selling these
work
hard
hard
hard
hard
work
work
Emergency!!
Emergency!!
Emergency!!
Emergency!!
Argh, my leggg!
Treated as expense Items rather than as capital items
Parts
ne
po
C
n
t
Small
parts, or substance, using in making the finished
??? WTF is that, mate ???
aintenance,
M
epair,
R
O
perating.
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--->
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x
P
D e p t h
D e p t h
D e p t h
particular
Initial product's cost are high
Growth
high
At end of this stage, competition
caught
up
|
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Gotcha!
has
frequently
in the buying: Diet Cola + candy bar.
Relatively inexpensive, frequently purchased, no thought
frequently
frequently
Small
decline
falls
away
or
or
r
The
core product
A product’s
supplemental features
are the added value
“Might shop at Best Buy, Circuit City, Home Depot, Sears”
Camera
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OOB 2009
Mont Blanc Pens
|
.
,
/
/
/
/
Advertising is in very select mediums
Purchased on the basis of an organization's goals and objectives
Product purchased for its functional aspects
a.k.a. no fun
|
into 7 categories
fall
Will
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CEO loves Legal
'
'
'
Coca-Cola Inc.
Juices / Juice Drinks
Tea and Coffee
Water
coca-cola soft drinks > 500 in 200 countries
Soft drinks
lines
|
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rip
)
TAB
®
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=^;^=
zzzz
Enjoy new things. Very eager to be the first in the neighborhood
Choose new products carefully.
Guy in the office who knows things.
A little ahead of most. Deliberate and cautious of new things.
Skeptic of new things. Buys them because of
economic or social pressure;
old one broke – duct tape only goes so far
Last to buy new products. Always thinking of the “good-old days”.
When makes purchase, it is usually the next version of the new product.
Laggards
Late majority
What we have here is a failure to succeed.

Consumer producs fail much more than business products.

First in market does not mean most successful in market.
1 out of 3 new products fails each year. This can cause US firms 100 Billion each year.

Main reason in company not matching product’s function to customer’s needs or poor timimg.
Absolute failure
Relative product failure
Makes a profit
but
Does not met companies profit or market-share objective
Never recover development, production,
and marketing costs
Energy Drinks
1975 - RCA
$999
2000 - Apex
$50
VCR
In the style of
Magnetic Poetry
Tag Cloud Art
Typography
A Prezi slide-show
This book published in 2010
Rolex
Corvette
Emergency!!
Emergency!!
Emergency!!
Emergency!!
not want to do so.
New products that succeed
like...
have perceivable advantages over similar products.
provIde sIgnificant and benefits to customers
Full transcript