Pp chap008
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Transcript of Pp chap008
8-1
Part Three
Business Marketing
8-3
PART THREE
Business Marketing Programming
• Chapter 8 Developing and Managing Products
• Chapter 9 Business Marketing Channels
• Chapter 10 Managing Customer Relationships
• Chapter 11 Communicating with the Market
• Chapter 12 IMC
• Chapter 13 Sales and Sales Management
• Chapter 14 Pricing and Negotiating for Value
Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin
Chapter Eight
Developing and Managing Products:
What do Customers Want?
8-5
THE BENEFIT CONCEPT
COMPETITIVEADVANTAGE:
PRODUCT:A Bundle of Benefits and a Collectionof Solutions to Needs and Wants
How the Product or Service Satisfies
A NeedBENEFIT:
A Benefit That Satisfies a CustomerBetter than A Competitor’s ProductBenefits
8-6
AUGMENTING:CREATING CUSTOMER SATISFACTION
• Objective is to customize a product for a customer to exceed their expectations
8-7
PRODUCT MANAGEMENT TOOLS
• THE PRODUCT DEVELOPMENT PROCESS
• THE PRODUCT LIFE CYCLE
• PRODUCT PORTFOLIO MANAGEMENT TOOLS
• BCG MATRIX
• GE MATRIX
8-8
THE BCG MATRIX:MEASURING MARKET GROWTH
AND MARKET SHARE
Market GrowthRate
Stars
CashCows Dogs
QuestionMarks
Market Share Relative to Nearest Competitor
BCG MatrixBCG Matrix
8-9
GE MATRIX MEASURING MARKET ATTRACTIVENESS AND BUSINESS STRENGTH
Market Attractiveness• Growth• Diversity• Competitive Structure Change• Technology Change• Social Environment
Business Strength
• Size of Market & Share
• Company Growth Rate
• Profit
• Margins
• Technology Platform
• Image
• People
GE Matrix
8-10
PRODUCT MANAGEMENT LEVELS
THE PRODUCT LINE
THE PRODUCT CATEGORY
THE PRODUCT
TECHNOLOGY THE PLATFORM
8-11
KEY PRODUCTMANAGEMENT DECISIONS
1. WHICH PRODUCT TO INTRODUCE
2. WHICH PRODUCTS TO KEEP
3. WHICH PRODUCTS TO PROMOTE
4. WHAT LEVEL OF PROMOTION TO PROVIDE (LOW TO HIGH)
5. WHAT PRODUCTS TO CONTINUE OR DELETE
8-12
PRODUCT LIFE CYCLE DECISION POINTS
Rapid expansion of distributorsProduct line expansionNiche marketingContinued heavy promotionSales force incentives and managementSearch for new sources for supplyNeed to balance supply and demandStock-out and back-order damage control
Development Introduction Growth Maturity Decline Time
Strongly defend home-market nichesPrune product linesEmphasize gross contribution rather than market share and sales volumeReview logistics: prune costsReduce pioneering sale force effort, more telemarketingMore trade than consumer promotionIntroduce flankers, private labels, genericsReinvest in market research & R&DUse promotions to increase heavy-user loyaltyFreeze investment in plantProductivity reviewSpecial trade promotions to keep channels happyFocused attacks on vulnerable competitorsLong-term price reduction or at least a short-term price promotionKeep plant at maximum capacity and subcontractexcess
Cut low-gross-margin products from the lineWithdraw from channels in order of their unprofitabilityFreeze R& D and product modificationsFreeze advertising and promotionsAttempt to maintain price to the endBuy back remaining stock and redistributeMaintain spare parts and serviceConsider divesting while it is a going concern
Redirect focus & promotionInvest in expanding productionBuild inventoryExpand distributor networkTrain expanded sales forceInstitute marketing controlsInvest heavily in advertisingTarget on best prospects: innovators and enthusiastsUse most loyal distributorsUse free samplesUse public demonstrations and trade showsUse publicity and endorsementsUse specialist media & catalogs
Sales
8-13
PRODUCT LIFE-CYCLE: A NEW LOOK
Product
Develop-ment
R&D
Test Marketing
Introduction Growth Maturity Decline
Kill the product
Find New Uses
Find New Markets
Repeat LifeCycle
8-14
PRODUCT DEVELOPMENT PROCESS:A NEW LOOK
EVALUATION
LAUNCH
BETA TESTING
PRODUCT DEVELOPMENT
SPECIFYING FEATURES
SCREENING AND PRELIMINARY INVESTIGATION
IDEA GENERATION
8-15
MAKING A PRODUCT SUCCESSFUL
1. Have close ties with a well defined market to anticipate customer needs.
2. Company is highly integrated and market-oriented
3. Company has a competitive advantage in technology and production capability
4. Company has a strong marketing proficiency
5. New product launch adequately financed
8-16
WINNING THE NEW PRODUCT CONTEST
• FOCUS ON CORE COMPETENCY(WHAT YOU DO BEST FOR A COMPETITIVE ADVANTAGE)
PLUS
• PROVIDE GREATEST VALUE TO CUSTOMER
EQUALS
• SUCCESSFUL PRODUCT