PRODUCT 1

Product Management

PRODUCT 2

Marketing mix and product management.

At the end of this module the learning actuates are.

1. What is a product?

2. Various levels of product.

3. How products are classified?

4. What is the concept of product life cycle?

PRODUCT 3

Marketing mix and product management.

Suggested readings.

1. Marketing management, Millennium edition by Kotler chapter10 and 13 .

PRODUCT 4

Marketing mix and product management.

What is product?

Product is anything that can be offered to a market to satisfy a want or need.

PRODUCT 5

Marketing mix and product management.

PRODUCT LEVELS

1. Core product

2. Basic product

3. Expected product

4. Augmented product

5. Potential product

PRODUCT 6

Marketing mix and product management.

1. Core product - Most fundamental benefit customer is buying.- Heart of the system.

Refrigerator - Basic purpose.

Preservation.

- To preserve you need a compressor and cooling system.

- This is core.

PRODUCT 7

Marketing mix and product management.

2. Basic product - Do you buy compressor?- You buy a basic product?- Formal

Refrigerator - Compressor is mounted on a body

/cabinet.- There is a door, shelves, trays.- This is basic product.

PRODUCT 8

Marketing mix and product management.

EXPECTED PRODUCT - A set of attributes and conditions customers

expect. This depends on the chosen target audience.

- This is expected from a marketer.Refrigerator

- Freezer.- Bulb.- Thermostat.- Quiet not noisy.- Different types of shelves.- Antirust system.This is expected product.

PRODUCT 9

Marketing mix and product management.

AUGMENTED PRODUCT - Prepare a product that exceeds customer

expectation. Is the reason to buy.- Add further attributes- Each attribute adds cost - Will customer pay enough to cover the extra

cost?Refrigerators

- Easy financing scheme- Four year warranty on compressor- Free rice – cooker with every refrigerator

purchased.

PRODUCT 10

Marketing mix and product management.

POTENTIAL PRODUCT - Companies search for new ways to

satisfy customers and distinguish their offer.

Refrigerator - Water dispenser – on the door

Prevent frequent opening of doors.Faster cooling.

PRODUCT 11

Marketing mix and product management.

WHAT DO WE OBSERVE?- Most competition at augmentation level.- Constant innovation.- Understand how customers use their

product.- New features add to the cost.- Marketers have to find out that whether

customers are willing to pay extra cost.

PRODUCT 12

Marketing mix and product management.

REFRIGERATORS.1. Whirlpool

• Quick lce making 2. Samsung

• Super x – flowUniform cooling.

3. LG • Nutritional value maintained.

4. ALLWYN• Efficient compressor.

5. KELVINATOR • Coolest.

PRODUCT 13

Marketing mix and product management.

PRODUCT CLASSIFICATION

A. Durability and tangibility- Nondurable goods.- Durable goods - Services.

B.  Consumer –goods classification - Convenience good.- Shopping goods - Speciality goods - Unsought goods.

PRODUCT 14

Marketing mix and product management.

A. Durability & Tangibility1. Non-durable goods

- Consumed in one or few uses- Consumed quickly- Frequent purchase- Need to make them available in many locations- Heavy promotion- Induce trial

ExampleCoke, Modern bread, Lux Soap, Mother Diary Milk

PRODUCT 15

Marketing mix and product management.

2. Durable goods- Used many times- More personal selling/service- Seller’s assurance about product longevity

Example- Refrigerators- Mixer- CarHigher priced than non-durableConsumer involvement is high as they are high priced

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Marketing mix and product management.

3. Services- Intangible- Inseparable- Variable- Perishable

Example- Beauty parlour- Education Services- A Surgery- Listening to concert- Airlines

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Marketing mix and product management.

Therefore

Products which are predominantly tangible are called goods

Products, which are predominantly intangible, are called services.

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Marketing mix and product management.

B. Consumer – Goods classificationBased on shopping habits

1. Convenience goodsGoods purchased

- Frequently- Immediately- Minimum effort

Example- Newspapers- Bread- Milk

Distributed at shops very near to households

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Marketing mix and product management.

2. Shopping goods- Goods that the customer in the

process of selection and purchase - Characteristically compares on such

basis as suitability, quality, price and style

Examples- Furniture- Clothing- Appliances

PRODUCT 20

Marketing mix and product management.

3. Speciality goods- Unique characteristics- Unique brand values- Buyers willing to make extra efforts

Example- Arrow shirts

Very few outlets, exclusive- Honda showrooms

One in Badarpur, Udyog NagarCustomers willing to travel that far to buy

their choice of goods

PRODUCT 21

Marketing mix and product management.

4. Unsought goods- Goods the consumer does not know

about or does not normally think of buying

- Consumers made aware through promotional efforts of the firm.

Examples- Life insurance- Security equipments- Fitness equipment

PRODUCT 22

Marketing mix and product management.

PRODUCT MIX- Set of all products and items that a particular

seller offers for saleExample:BPL

Consumer products- TVs, Washing Machine

Cellular Services- Mobile operations in Mumbai

Telecom- Instruments

PRODUCT 23

Marketing mix and product management.

Product Mix-concepts

1.   Width- How many different product lines are

carried by the organization

P & G Five lines

- Detergents, Toothpaste, Bar soap, diapers, paper tissue

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Marketing mix and product management.

2. Length Total number of items in the mix Total items 25 Average length of a line is 25/5 = 5

3. Depth How many variants are offered of each

product in the lineProctor and Gamble

Crest Toothpaste-   Comes in five sizes- Two formulations

Mint Regular

Total Depth = 5 * 2 = 10

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Marketing mix and product management.

4. ConsistencyHow closely related the various product lines are in end use, production requirements, distribution channels or some other way.

Proctor and Gamble- Very consistent- Why- Products are available through the same

distribution channelsGE

-   Products Refrigerators Aircraft Engine’s Electricity equipments

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Marketing mix and product management.

GE• Very inconsistent• Are Refrigerators, Aircraft engines and

Electricity equipment available from same places

• No ?• Refrigerators

- Shops• Aircraft Engine’s

- Direct

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Marketing mix and product management.

PRODUCT LIFE CYCLE

Four stages

1. Introduction

2. Growth

3. Maturity

4. Decline

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Marketing mix and product management.

PRODUCT LIFE CYCLE Products have limited life Products pass through distinct stages Each stage

- Different challenges- Different opportunities- Problems to the seller

Profits and sales vary in different stages Different strategies

- Marketing- Human resources- Purchasing

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Marketing mix and product management.

1. Introduction- Slow sales growth- Product introduced- Profits less or non-existent- Heavy expenses

Promotion

Distribution

 

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Marketing mix and product management.

2. Growth - Rapid market acceptance- Substantial profit improvement

3. Maturity- Slowdown in sales growth- Achieved acceptance by most potential buyers- Increasing competition - Profits stabilize or decline

4. Decline- Sales show decline- Profits also decline

PRODUCT 31

Marketing mix and product management.

Product life cycle- Product categories

Longest- Newspaper- Sugar- Ice-cream

- Branded categoriesShorter- Pioneer Newspaper- Dollops Ice-cream

Newspaper, ice-cream sales are risingPioneer & dollops sales have declined

PRODUCT 32

Marketing mix and product management.

Why four stages in Product lifecycle

Marketers deploy different marketing strategies in different stages of product life-cycle .