1. Welcome M.Jakkaraiah Asst.professor PBR VITSKAVALI

2. What is a product ? A product is anything that can offered to market for attention, acquisition ,use, consumption that might satisfy a want or need. 3. PRODUCTSTangible Intangibleproducts productsGOODS SEVICES 4. Features of producttangibilityAssociated attributesIntangibleFeatures of attributes product Customer Exchange valuesatisfaction 5. Levels of productUnexpected featuresPotential productLuxury features Augmented product Expected featuresExpected product Basic features Generic productBasic productCore benefit 6. Classifying ProductsDurable productsConsumer products,Business products 7. Durable products Durable Non-durable Services 8. Consumer Products Shopping Specialty Products ProductsConvenienceProducts Unsought Products. . To satisfy information needs & buying motives 9. CONVENIENCE GOODSConvenience goods consumers use minimal effort forfrequently purchased low cost items Staples - Emergency goods Impulse purchases 10. Shopping ProductsShoppinggoods - consumers make aconsiderable effort to evaluate Consumers make product comparison(s), They seek information before purchase, they are not impulsive Moderate substitutions are made Products last a considerable time Monetary & social costs may be high 11. TVs As a Shopping Product(2007 ---- 1950s)Attribute-basedPrice-basedPlasma LCD screenLOW PRICE WARRANTYREMOTE CONTROL PICTURE SIZE Homogeneous products select on price Heterogeneous products select on benefits 12. Business products Materials and parts Raw materials and parts Manufactured materials and parts Capitals items 1.installation 2.equiptment Suppliers and business services 1.maitainance and repair items 2.operating suppliers 13. Raw materials Farm products Natural products 14. Manufactured materials and parts 15. Capitals items 1.installation 2.equiptment 16. Suppliers and business services 1.mainteinance and 2.operating suppliersrepair items 17. Product Mix & Product Line Product Item 18. Product mix 19. Product Mix The assortment of products that a companyoffers to a market Width how many different product lines? Length the number of items in the productmix Depth The no. of variants offered in aproduct line Consistency how closely the product linesare related in usage 20. Product Line& Product Mix Product LineLAMPS Table Ceiling Track Desk 21. Product Mix Product ProductProductLine 1Line 2 Line 3LAMPS TABLESCHAIRSTableKitchen Dining RoomCeilingDining Room Living RoomTrackEnd BedroomDesk CoffeeOutdoorOutdoor DeskConferenceComputer 22. CONCEPTUALIZATION OFPRODUCT MIXHomeWIDTHDepot,Lowes Tata MotorsTata Steel Tata Tea Tata DTH D GEMINIBUSBARS TEA E# of lines = 4 PLORRYPLATES# of items = 12TCARS HA wide product mix facilitates one stop shopping 23. PRODUCT MIX EXAMPLEWidth (# of product lines) HAIRSALTYDENTAL SOFT CARE SNACKS CARE DRINKSShampoo Chips Tooth Brush ColaConditione Nuts Tooth Paste Ginger AlerDental Floss CrackersRoot BeerHair Spray 24. Factors influencing change in product mix Changes in market demand Cost of production Quantity of production Changes in company desire Competitors actions and reactions 25. Product mix stratagies Expansion of product mix Contracting or dropping the product mix Alteration of existing product s Trading up/trading down stratagies 26. Product management Planning Forecasting Marketing of products of a company is product management 27. Objectives of product management To design product stratagies To spot market opportunities To develop strategies for each stage of product lifecycle To generate new product ideas 28. New product planningNew product : New to the company even it is in theworldTypes of new products1.New to the world2.New to the firm3.Addition to existing product line4.Improved and revised5.Reduction in cost 29. Importance of new product To meet consumer needs and wants To meet competition To increase profits To avoid threats from substitutes 30. New Product Development ProcessStep 1. Idea GenerationSystematic Search for New ProductIdeasInternal sourcesCustomersCompetitorsDistributorsSuppliers 31. Step 2. Idea Screening Process to spot good ideas and drop poorones Technically feasibility Financially viable 32. Step 3. Concept Development & Testing1. Develop Product Ideas into AlternativeProduct Concepts 2. Concept Testing - Test theProduct Concepts with Groups of Target Customers3. Choose the Best One 33. Step 4. Marketing Strategy DevelopmentPart One - Overall:Target Market Planned Product Positioning Sales & Profit GoalsMarket Share Part Two - Short-Term: Products Planned PriceDistributionMarketing BudgetPart Three - Long-Term:Sales & Profit Goals Marketing Mix Strategy 34. Step 5. Business AnalysisStep 6. Product DevelopmentBusiness Analysis Review of Product Sales, Costs, and Profits Projections to See if They Meet Company ObjectivesIf No, EliminateProduct ConceptIf Yes, Move to Product Development 35. Step 7. Test Marketing Standard ControlledTest Market Test MarketFull marketing campaignA few stores that have in a small number of agreed to carry new representative cities.products for a fee. SimulatedTest Market Test in a simulatedshopping environment to a sample of consumers. 36. Step-8 commercializationIntroducing the product into the market 37. Product Life CycleSales andProfits ($) SalesProfits TimeProduct Introduction Growth MaturityDeclineDevelop- mentLosses/Investments ($) 38. Introduction Stage of the PLCSales Low salesCostsHigh cost per customer Profits NegativeCreate product awarenessMarketing Objectives and trialProduct Offer a basic productPrice Use cost-plusDistributionBuild selective distributionAdvertisingBuild product awareness among early adopters and dealers 39. Growth Stage of the PLCSales Rapidly rising salesCosts Average cost per customer Profits Rising profitsMarketing ObjectivesMaximize market share Offer product extensions, service,ProductwarrantyPricePrice to penetrate marketDistributionBuild intensive distributionAdvertisingBuild awareness and interest in the mass market 40. Maturity Stage of the PLCSales Peak salesCosts Low cost per customer Profits High profitsMarketing Objectives Maximize profit while defendingmarket shareProductDiversify brand and modelsPrice Price to match or best competitorsDistribution Build more intensive distributionAdvertisingStress brand differences and benefits 41. Decline Stage of the PLCSales Declining salesCosts Low cost per customer Profits Declining profitsMarketing Objectives Reduce expenditure and milk the brandProductPhase out weak itemsPriceCut priceGo selective: phase out unprofitableDistribution outletsAdvertising Reduce to level needed to retainhard-core loyal customers 42. Introduction Stage-StrategiesPRODUCTOffer a basic productPRICECost +profitSALES PROMOTION Heavy expenditure to create trails DistributionBuild selective distributionBuild product awareness among early Advertisingadopters and dealers 43. Growth Stage of the PLCOffer product extensions, service, Productwarranty Pricepenetrate PriceDistributionBuild intensive distributionBuild awareness and interest in theAdvertising mass marketSales promotion Consumer demo 44. Maturity Stage of the PLC Product Diversify brand and models Price Price to match or beat competitorsDistributionBuild more intensive distributionAdvertising Stress brand differences and benefitsSales promotion Encourage to brand switching 45. Decline Stage of the PLC Product Phase out weak items Price Cut priceGo selective: phase out unprofitableDistribution outletsAdvertisingReduce to level needed to retainhard-core loyal customersSales promotion Reduce to minimal level 46. Causes of New Product Failures Overestimation of Market Size Product Design Problems Product Incorrectly Positioned, Priced or Advertised Costs of Product Development Competitive Actions Technical problems Poor planning Inadequate promotion Poor packing Fault pricing 47. CONSUMER ADOPTION PROCESS Adopt TrailEvaluation InterestAwareness 48. CONSUMER ADOPTION PROCESS Potential productAugmented productExpected ProductGeneric product Core Benefit