Mkt_Fnd_Lecture5-1slide_AUT 18.pdf - Lecture 5 Product Chapter 7 Product Learning objectives \u2022 define \u2018product\u2019 and product attributes \u2022

Mkt_Fnd_Lecture5-1slide_AUT 18.pdf - Lecture 5 Product...

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Unformatted text preview: Lecture 5: Product Chapter 7: Product Learning objectives: • define ‘product’ and product attributes • describe the product life cycle, new product development and the product adoption process • product differentiation • branding • role of packaging • product management and positioning through the product life cycle. 2 What is Marketing & Brand Strategy? 3 Product • Product: A good, service or idea offered to the market for exchange. – Good: A physical (tangible) offering capable of being delivered to a customer. – Service: Intangible offering that does not involve ownership. – Idea: Concept, issue or philosophy offered to the market. 4 Products Good Service Idea Product Total product concept • Describes the core product, expected product, augmented product and potential product in order to analyse how the product creates value for the customer. basic need the product fulfilling expected benefits/ aspects from the product brand differentiate not exist now, but expecting in future Figure 7.1 6 What are the product layers for Lexus GS? 7 Product e.g. product item: iphone 8 product line: iphone product mix: apple pruducts Product item • A particular version of a product. Product line • A set of product items related by characteristics such as end use, target market, technology or raw materials. Product mix • The set of all products that an organisation makes available to customers. 8 Product • Consumer products: Purchased by households and individuals for their own private consumption. • Business‐to‐business products: Purchased by individuals and organisations for use in the production of other products or for use in daily business operations. 9 Product • Shopping products: moderate to high engagement decision‐ making • Convenience products (fast‐moving consumer goods): Inexpensive, frequently purchased, products bought with low engagement decision‐making. • Specialty products: Highly desired products with unique characteristics that consumers will make considerable effort to obtain. • Unsought products: Purchased to meet a sudden, unexpected need. 10 Consumer Products Convenience Unsought Shopping Speciality Product life cycle • The typical stages a product progresses through: • new product development • introduction • growth • maturity • decline. 12 Product life cycle Figure 7.3 13 Product life‐cycle Australian ready‐to‐drink juice market 14 New product development process 1. Idea generation 2. Screening 3. Concept evaluation 4. Marketing strategy 5. Business analysis 6. Product development 7. Test marketing 8. Commercialisation 15 New Product • Of 15,000 officially registered screenplays only 4,000 are “green lighted” (Wharton, 2006) Product adoption process Figure 7.4 17 Diffusion of innovations • Social groups influence the decisions made by individuals in such a way that innovations are adopted by the market in a predictable pattern over time. Figure 7.5 18 Product differentiation • The creation of products and product attributes that distinguish one product from another. • Characteristics that customers may perceive to be differentiators include design, brand, image, style, quality, features and price. 19 Product Differentiation Branding Brand A collection of symbols (e.g. name, logo, slogan) intended to create an image in the customer’s mind that differentiates a product from competitors’ products. Brand image The set of beliefs that a consumer has regarding a particular brand. 21 Branding Brand name: Part of a brand that can be spoken, including words, letters and numbers. Brand mark: Part of a brand not made up of words — it often consists of symbols or designs. Trade mark: A brand name or brand mark that has been legally registered so as to secure exclusive use of the brand. 22 Brand Name Seinfeld 23 24 Branding Brand equity: Added value that a brand gives a product. Brand loyalty: Customer’s highly favourable attitude and purchasing behaviour towards a brand. Brand metrics: Value of brand in terms of brand assets, stock price analysis, replacement cost, brand attributes, and brand loyalty. 25 Developing brands Individual branding : A branding approach in which each product is branded separately. Family branding: A branding approach that uses the same brand for several of the organisation’s products. Brand‐extension: Giving an existing brand name to new product in a different category. 26 Branding strategies Manufacturer brands: Brands owned by producers and clearly identified with the product at the point of sale. Private label brands: Brands owned by resellers, such as wholesalers or retailers, and not identified with the manufacturer. Generic brands: Products that only indicate the product category. 27 Branding control Licensing: The brand owner permits another party to use the brand on its products. Franchising: Agreement to use an established business model. Benefits: coordinated promotional activity, reduced risks and effort. Co‐branding: Use of two or more brand names on the same product. 28 Line Extension Packaging Primary package: Holds the actual product Secondary package: The material used to hold or protect the product, it can be removed and discarded after purchase Shipping package: Used to carry the product out of the factory, through the distribution channel to the retailer. 30 Packaging Labelling Part of the package and provides identifying, promotional, legal and other information. •Compulsory label information can include: • Brand name and logo • Product name • Ingredients list • Use‐by‐date or date of packaging • Bar code 32 Product strategies Igor Ansoff’s Product‐market growth strategy: Market Penetration: Selling more of existing products to existing or new customers. Lowest risk Product Development: New products for current markets emphasising innovation. Risky Market Development: New markets for existing products. Riskier Diversification: New products in new markets. Riskiest 33 Managing through the life cycle Line extensions: New products that are closely related to existing products in a product line. Product modifications: Changes to the characteristics of a product to supersede the original. The main types of product modification relate to: – functionality – quality – aesthetics. 34 Repositioning Product positioning: The way in the market perceives a product in relation to competing offerings. Product deletion: The process of removing a product from the product mix. 35 The role of law To define acceptable vs unacceptable behaviour Marketing law includes any regulations that attempt to ‘draw the line’ between acceptable competitive business conduct and unacceptable business practices. Beside the law textbook, here is a helpful ACCC website about marketing laws: Marketing laws Designed to protect: • Consumers • Traders • The competitive system that underpins the ‘free market’ Australian economy. Consider the application of the Competition and Consumer Act 2010 and the Australian Consumer Law. Product laws 1. Intellectual property: – Patents for new inventions – Registering a trade mark – Registering a design – Copyright Product laws 2. Packaging and labelling: Designed to standardise information and protect against misleading or deceptive information, e.g. – Weight – Content of goods – Food ingredients Product laws 3. Product liability: Minimum acceptable product safety and quality standards, such as: – Food hygiene regulations – Manufacturer liability for defective or negligent products ...
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