Employ product-mix strategies to meet customer expectations: Using Customer Input to Design Winning...
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Transcript of Employ product-mix strategies to meet customer expectations: Using Customer Input to Design Winning...
Entrepreneurship I - 2.07
Employ product-mix strategies to meet customer expectations:Using Customer Input to Design Winning Products
Created by Alison Garrett, Debbie Pardue, Cara Midyette & Terry Deese
The assortment of goods and services that a business offers in order to meet its market’s needs and its company’s goals.◦ Includes product lines & individual products
What is a Product mix?
Marketing Concepts
Market: The group of potential customers who have similar needs/wants, sufficient buying power, and the willingness to give up a portion of that buying power in order to buy your product/service.
Marketing Concepts
Target Marketing: Identifying market segments with the greatest potential for sales and focusing marketing decisions on satisfying the individuals that make up these segments.
Marketing Concepts
Target Market: The group or groups of potential customers identified as most likely to patronize the business and buy its products. Sometimes, a business can take an existing good or service and change it so it will fulfill the needs of another target market. Example: some products can be altered to accommodate
people with certain disabilities
Customers buy your products because of the value that it can give them. ◦ They are not buying your product per se, but
what your product can give them. ◦ They are buying the satisfaction of a want.
Why Do Cutomers Buy? Customers have different motivations
when they buy. ◦ Some consider price as the main deciding
factor, often looking for the lowest available price.
◦ Others try to find ways to reduce cost and at the same time enhance revenue and improve quality.
Customers will not buy a product if they don’t foresee receiving a positive benefit from it.◦ A User Experience is the feeling that a customer
gets when using a product. ◦ The User Experience is important because it often
colours the user’s perception of the product far more than the technical features of the product do.
Businesses must find out what features they need to add to a product to produce the benefit a customer is looking for.
Giving the Customer What They Want
The iPhone is not the most technologically advanced phone on the market (remember those reception issues?), but it provides the type of “cool” user experience that its target user values.
That “cool” factor, which has generated tremendous success for the iPhone, didn’t happen by accident – it was designed into the product.
Example of Giving the Customer What They Want
To compete in the marketplace, a business must develop or find products that will fulfill its customers’ changing needs and wants.
Obtaining customer feedback is a good way to evaluate how a business is meeting its customers’ needs and what it needs to do to increase customer satisfaction.
It is important that you know what customers consider most valuable about your products or services.
Find Out What the Customer Wants
Have a marketing person call on customers with survey questions. ◦ Could have a person conducting market study groups or
hire an outside agency to capture company data. These options can be costly
How to Get Customer Input
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Document customer feedback. ◦ When a customer calls or emails your
company with positive or negative feedback, this information should be documented and stored in a database.
Once you have a list, ask them again if you are indeed delivering what they want.
How to Get Customer Input
Use two questions – ◦ what does the customer value with regards
to your products and services◦ how well do you provide that value
Use of face-to-face interviews. ◦ Arrange for a series of informal conversations
with typical individual members of your target user community.
◦ Don’t interview a group – you won’t get the same quality of input.
◦ Choose a comfortable setting to allow them to relax and share their thoughts without the distractions of their day-to-day responsibilities.
A feature is a physical characteristic or quality of a product.
What products have. ◦ For example, say you sell an accounting software. You can
say, “This accounting software has a reporting feature.” It is something the customer can touch, feel, smell,
see, or measure
What is a Product Feature?
It helps describe the product.
A feature answers the question, “What is it?”◦ Ex: color, style, size
Benefits — what features mean.
The personal satisfaction or advantage that a customer wants from a product.
It is how the feature helps a particular buyer
For customers, it answers the questions:◦ How will I benefit?◦ What’s in it for me?
What is a Product Benefit?
Prove to customers your product has features that benefit them
Customers buy benefits-not features Compare to competition Determine what each customer is looking for
in a good or service
Feature-benefit Selling
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Salespeople should be able to explain these three types of benefits to customers:
◦Obvious or apparent benefits
◦Unique or exclusive benefits
◦Hidden benefits
Three types of benefits
Advantages that need little explanation by the salesperson.
The customer already knows the benefit◦ Ex: Water repellant rain coat◦ What is the obvious benefit?
Even if benefits are obvious, salespeople should still point them out and use them to prove the value of the product to customers
Obvious or apparent benefits
Advantages that are available only from your good, service or business.
Is a selling advantage over your competitors
Ex: a car that “parks” itself is a novelty ◦ Offers a huge benefit to customers that have
trouble parallel parking
Unique or exclusive benefits
Ford Focus
Advantages that cannot be seen or understood without the assistance of a salesperson
Ex: buying a pair of shoes◦ You can see the color and style◦ You can not see how comfortable they are until
persuaded to try them on Ex: purchasing a computer
◦ Warranties/24-hour helpline
Hidden benefits
Step One: Find your product’s features◦ Construction and materials:
What is the material? Who makes it? How is it made? What’s the difference between these two
items?◦ Appearance and style
Appearance is a dominant factor in many buying decisions
Customers consider color, line, and design in everything they buy – cars, clothes, accessories, appliances, furniture, etc.
Feature-benefit charts
Step one cont’◦ Unique or novel features
Having desirable features that your competitor does not have
◦ Durability How long a product will last and give dependable
service◦ Product uses
What the product will do and how it can be used◦ Service and warranty
Especially important when selling products such as appliances, electronics, and cars
Feature-benefit charts
Step two: Know where to get facts about product features◦ The product itself
Use the product and information provided◦ Customers
Testimonials◦ Manufacturer’s brochures and publications◦ Other sales personnel◦ Promotional materials
Product bulletins Catalogs/manuals
Feature-benefit charts
Step Three: create a feature-benefit chart◦ After you know what type of information you need
and where to obtain the facts about your products, prepare a feature-benefit chart List all the product’s features, beginning with the
ones that a customer or client will see first List the less-obvious or hidden features For each feature that you identified, ask, “what does
this mean for the customer?” Write each benefit beside its feature A feature can provide more than one benefit
Feature-benefit chart
Product Features (What are they?)
Benefits (What do they mean?)
Computer Variety of models You will be able to select different components to build a system that meets your specific needs
Monitor size Large monitors that come with these computers enable you to see the entire page. Gives a clear understanding of how the document looks
Memory These models can be loaded with sufficient memory so your computer can handle any program
Print capability Handle all your printing needs in your home or office
Sample feature-benefit chart