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product planning and type of innovation

product planning and type of innovation - Product Planning...

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Product Planning and Types of Innovation 1 Product planning (influenced by market segment strategies): it outlines the focus of: A Core businesses: maintain, expand or harvest current products A.a) Emphasize the marketing of existing products to existing market segments A.b) All careful decisions are made based on market conditions, the age of the product, and competitive factors. B Market development: add new market segments B.a) Firms may sell directly to these or use new channels of distribution. B.b) Firms may expand from local markets to regional, national, and international markets. C Product development: improve products and add to product line C.a) Improvements to older products C.b) Line extension: developing new products that are closely related to existing ones. It is not limited to physical products. D Diversification: add new-product lines and expand into unrelated businesses D.a) Extensions of the current business D.b) New ventures 2 Types of product innovation: being classified according to the effect they have on consumers A Continuous innovation (new style of clothes) A.a) minor change A.b) familiar product A.c) easily adopted A.d) no significant alteration in consumer behavior B Dynamically continuous innovation (record to CD) B.a) familiar product B.b) additional features and benefits B.c) require alteration in some aspects of consumer behavior C Discontinuous innovation (GPS) C.a) entirely new product with new functions C.b) require behavioral changes by users 3 Why innovations succeed: it is important that new product meets consumers’ needs. There are several factors that influence consumer acceptance of new products. A Relative advantage : the amount of perceived superiority the new product has in comparison to existing ones. B Compatibility : it fits easily into the consumers’ current thinking or system C Product complexity : marketers should make sure there are understandable manuals for consumers to read, so that the product is easy to understand and use.
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