Developing Successful ProductsBrandon Burton

Greg Zankowsky

Melina Blundetto

Students will know:

How customers view products

How marketers keep a consumer focus during product development

The parts of the product mix element

The three steps of the product design process

The importance of product lines, packaging, and brand development

Consumer markets and what is meant by direct demand

The importance of the business product classification system

What businesses mean by “new” products

The six steps in new product development

How customers view products

Concerned about their needs View products as a way to satisfy these needs

The physical characteristics of a product are important Durable, attractive, and safe

A customer’s need vary Variety, quality, service, location, price, etc.

How marketers keep a consumer focus during product development

Gather Information Evaluating marketing study

Interpreting results to assist in product planning

Keeps focus on consumer needs

Design Strategies Identify target market

Determining company strengths and weaknesses

Evaluating existing and potential competitors

Conduct Marketing Tests Determine whether if a new product will be successful

Reduce project failures

The parts of the product mix element

Offering choices Variations

Offering a guarantee Persuade customers to switch products

Testimonial Recommendations

The three steps of the product design process

Basic Product Simplest form

Easily identified and used

Similar to competition

Modifications and Improvements Features and options

Changes the basic product

Increases satisfaction

Services and complementary products Services, guarantees, information on effective use of the product,

and additional products that improve the use of the primary product

Meet additional customer needs

Improve customer satisfaction

The importance of product lines

Product line A group of similar products with slight variations in the product

mix to satisfy different needs in a market.

Variation in Quantity Expanding from one product to many products.

Having more choices for customers

Variation in Quality Adding features to basic products may produce several levels of

product choices that vary in quality

Basic products may be lower in price

Having a featured product may increase in price.

Product Assortments The complete set of all products a business offers to its market.

Importance of Packaging

Dual purpose of protection and promotion

Improves the use of the products

Solve customer problems related to the use of the product

Safety and Protection

Attractive Convey an image

Importance of Brand Development

Name, symbol, word, or design

Provides a unique identification for the company

Part of the purchase decision

Gain customer recognition Increase likelihood of a sale

Convey a particular image that can be recalled

Consumer markets and what is meant by direct demand

Consumer Market Individuals or socially related groups who purchase products

for personal consumption

Direct Demand The quantity of a product or service to meet the needs of

the customers

The demand for consumer products.

The importance of the business product classification system

Capital Equipment Land, buildings, and major pieces of equipment.

Most expensive and most important products purchased.

Meet specific needs in order to operate successfully.

Operating Equipment Tools, small machines, and furniture.

Makes production and operations efficient and effective.

Supplies Paper, pencils, paper clips, cleaning supplies, and parts for

equipment repair.

Can include minor and major expenses for company.

Standardized

The importance of the business product classification system (con’t)

Raw Materials Components used to produce a companies products.

Adequate supply and equal quality of production.

Component Parts Parts of a businesses products that have been partially or

totally produced by another company.

For example: computer manufacturer buys computer chips from another company..

Designed for needs of one company

What businesses mean by “new” products

Changes and improvements to an existing product

Products that are new to a particular market

A product can be called new for only six months after the introduction or change of a product

A new use for a product can be discovered

The six steps in new product development

Idea Development

Ideas for new products

Consumer Problems

Creative Process

Idea Screening

Evaluate Ideas

Select those that have the greatest chance for success

Develop criteria

Strategy Development

Create and test a sample marketing strategy

Clearly identify an appropriate target market and ensure that customers exist with the need and money for the product

The six steps in new product development (cont.)

Financial Analysis Costs of production and marketing, sales projections for the

target market, and resulting profits are calculated

Product Development and Testing Design the product process

Obtain needed equipment and materials

Training personnel

Product Marketing Full scale introduction into the market

Key Terms

Product Anything tangible offered to a market by a business to satisfy needs

Product line A group of similar products with slight variations in the product mix

to satisfy different needs in a market

Product assortment The complete set of all products a business offers to its market

Trademark The legal protection of the words or symbols for use by a company

Licensed Brand A well-known name or symbol established by one company and sold

for use by another company to promote its products

Key Terms Cont.

Consumer Markets Individuals or socially related groups who purchase products for

personal consumption

Direct Demand The quantity of a product or service needed to meet the needs of

the consumer

Business Markets Companies and organizations that purchase products for the

operation of a business or the completion of a business activity

Derived Demand The quantity of a product or service needed by a business in order

to operate at a level that will meet the demand of its customers

New Product A product that is entirely new or changed in an important and

noticeable way