mktg1001 wk9 - Marketing Principles This week Chapter 9 New...

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MKTG1001: Semester 1 Marketing Principles This week… New Products Success/failure of New Products New Product Development Process Presentation Skills Chapter 9
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MKTG1001: Semester 1 A tale of two burgers ARCH DELUXE Launched in 1996 A more ‘adult’ burger With more ‘sophisticated’ tastes + higher price Somewhat similar to the ‘McFeast’ Development and launch costs of $300 million ANGUS BURGER Introduced by Burger King in USA McDonalds now sells the burger in the US and Australia + NZ Part of food diversity strategy at McDonalds, with goal of being an everyday food choice
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MKTG1001: Semester 1 Some TVC’s ARCH DELUXE (1996) Poor product fit with positioning Poor product fit existing products (overall strategy) Inconsistent with fast-food ‘reference’ price ANGUS BURGER (2009) In line with ‘ choices positioning Broader range of higher value products, e.g. McCafe Market pays higher prices e.g. Subway
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MKTG1001: Semester 1 Key Lessons
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What is a New Product? New to the world Brand new invention, not available in the market before New category Existing product in market, but NEW type of product to the firm Product line extension Variety of existing product already offered by the firm Product improvement “New and improved” existing product Repositioning Change of image, use, or target market for an existing product
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MKTG1001: Semester 1 Types of New Products Product Line Extension Product Improvement Leveraging existing product success, brand, relationships Enhancing existing product against competitors and changing customer needs Most common – natural part of product management role – normal part of the business
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MKTG1001: Semester 1 Associated Risks Product Line Extension Product Improvement Cannibalising existing sales, poor product damage brand, poor retailer acceptance, increased mgt/promo support Increased cost, poor market acceptance (e.g. New Coke)
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MKTG1001: Semester 1 Types of New Products New to the world New category Using capabilities (skills, technology, resources) to leapfrog competition or create a “monopoly” Leveraging our capabilities into a new product category Less common – generally part of major/strategic decisions Repositioning Re-establishing an existing product with a fresh image and new target market
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MKTG1001: Semester 1 Associated Risks New to the world New category Huge up-front expense, product may not gain market acceptance, major distraction Move into unfamiliar market against established competition Needs a strong understanding of the market Repositioning Significant cost, give up on existing sales, hard to re- educate the market
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MKTG1001: Semester 1 Why Introduce New Products?
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mktg1001 wk9 - Marketing Principles This week Chapter 9 New...

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