NATURE AND SCOPE OF THE PRODUCT/SERVICE MANAGEMENT FUNCTION. PRODUCT AND SERVICE MANAGEMENT IS DIFFERENT BUSINESSES TRYING TO MEET THE NEEDS, WANTS, AND DESIRES OR CONSUMERS.
THE IMPACT OF PRODUCT LIFE STYLES ON ON MARKETING DECISIONS.
WHEN A BUSINESS PLANS IT'S MARKETING MIX, THEY HAVE TO CONSIDER AND REALIZE THREE IMPORTANT FACTORS, WHICH ARE THE TYPE OF COMPETITION, THE PURCHASE BEHAVIOR OF CONSUMERS, AND THE STRENGTHS AND WEAKNESSES OF A BUSINESS. A PRODUCT LIFE CYCLE IS USED TO DETERMINE THE TYPE OF COMPETITION. IT IDENTIFIES THE STAGES A PRODUCT GOES THROUGH FROM THE TIME IT ENTERS THE MARKET UNTIL IT IS NO LONGER SOLD.
THE FOUR STAGES OF THE PRODUCT LIFE cycle:
1. INTRODUCTION: WHEN A PRODUCT, THAT IS FOR THE MOST PART DIFFERENT FROM OTHER PRODUCTS ALREADY ON THE MARKET, IS INTRODUCED INTO THE MARKET. AT THIS POINT, CONSUMERS DON'T KNOW MUCH, OR EVEN ANYTHING, ABOUT THIS NEW PRODUCT.
2. GROWTH: AFTER A PRODUCT IS INTRODUCED INTO A MARKET SUCCESSFULLY, IT BEGINS TO GROW AND BECOME MORE POPULAR WITHIN A MARKET. AS THE POPULARITY GROWS, THE PROFITS START TO AS WELL.
3. MATURITY: THIS IS THE POINT THAT SALES AND PROFITS PEAK AT THEIR HIGHEST POINT. CONSUMERS NOW BASE THE PRODUCT MORE SO ON THEIR NEEDS. ALSO, THERE ARE OTHER PRODUCTS ON THE MARKET THAT ARE NOW SIMILAR TO THIS ORIGINAL ONE.
4. DECLINE: WHEN CONSUMERS FIND THAT THIS PRODUCTS IS NOT MEETING THEIR NEEDS ANY LONGER, THE SALES AND PROFITS OF THE PRODUCT WILL THEN DECLINE. THERE IS RARELY ROOM FOR IMPROVEMENT ON THE PRODUCT TO MAKE IT LAST LONGER IN THE MARKET AT THIS POINT.
THE NEW PRODUCT DEVELOPMENT PROCESS.
1. THE FIRST STEP IS IDEA DEVELOPMENT. THIS IS CONSIDERED THE MOST DIFFICULT STEP BECAUSE YOU HAVE TO COME UP WITH AN IDEAS THAT YOU BELIEVE WOULD BE SUCCESSFUL IN THE MARKET BEFORE EVEN TESTING THE PRODUCTS.
2. THE SECOND STEP IS IDEA SCREENING. AT THIS POINT, A COMPANY HAS TO SCREEN THROUGH ALL THEIR IDEAS TO SEE WHICH ONE THEY THINK WOULD BE THE MOST SUCCESSFUL.
3. STEP NUMBER THREE IS STRATEGY DEVELOPMENT. A COMPANY WILL COME UP WITH A STRATEGY OR TEST USING RESEARCH.
4. NUMBER FOUR IS FINANCIAL ANALYSIS. IF THE PRODUCT IDEA IS APPROVED THROUGH ALL THE STEPS ABOVE, THEN A COMPANY WILL CONSIDER COSTS OF PRODUCTION, SALES PROJECTIONS, AND THE PROFIT THAT THEY WILL MAKE. THEY COME UP WITH THE BEST-CASE AND WORST-CASE POSSIBILITIES.
5. THE FIFTH STEP IS PRODUCT DEVELOPMENT AND TESTING. AFTER CAREFUL PLANNING, THEY WILL DECIDE IF IT IS WORTH STARTING PRODUCTION PLANNING ON THIS PRODUCT, ALONG WITH OBTAINING THE NEEDED EQUIPMENT AND SUPPLIES. IT IS IN A WAY SAMPLED.
6. THE LAST STEP IS PRODUCT MARKETING. THIS IS WHERE THE PRODUCT WILL GET COMPLETELY INTRODUCED INTO THE MARKET.
OG 16 COMPARE AND CONTRAST WARRANTIES AND GUARANTEES
WARRANTIES AND GUARANTEES. A WARRANTY IS A SPECIFIC WRITTEN STATEMENT OF THE SELLER'S RESPONSIBILITIES. A GUARANTEE, ON THE OTHER HAND, IS A GENERAL PROMISE OR ASSURANCE OF QUALITY. THERE ARE THESES OPTIONS WITH PRODUCTS FOR ASSURANCE THAT A PRODUCT, IF DAMAGED, WILL BE REPAIRED OR REPLACED. 1. A GUARANTEE IS ALWAYS FREE. A WARRANTY ATTRACTS CHARGES AS THE INSURANCE POLICY. 2. THE GUARANTEE IS A COMMITMENT TO MAKE GOOD DEFECTS OF A PRODUCT OR A SERVICE IN A FIXED PERIOD. A WARRANTY LOOKS AFTER THE REPAIRING OF A NEW ARTICLE WITHIN THE VALIDITY PERIOD. 3. A GUARANTEE IS A LEGAL CONTRACT WITHOUT ANY PAYMENT. A WARRANTY RECEIVED ON PAYMENT IS ALSO A LEGAL INSTRUMENT WITH WHICH THE SELLER CAN BE BROUGHT TO BOOKS. 4. A GUARANTEE IS AN ADDITION TO THE LEGAL CONSUMER RIGHTS. A WARRANTY DOES NOT AFFECT THE RIGHTS UNDER THE CONSUMER ACT. 5. A GUARANTEE IS APPLICABLE IRRESPECTIVE OF THE PROVISION OF THE WARRANTY. A WARRANTY IS FREE TO GO TOGETHER WITH A GUARANTEE ISSUED ON THE SAME ARTICLE A WARRANTY IS A SELLER'S GUARANTEE ABOUT THE QUALITY AND PERFORMANCE OF GOODS AND SERVICES. THE WARRANTY MAY ALSO INCLUDE A STATEMENT OF WHAT THE SELLER OR MANUFACTURER WILL DO IF A PROBLEM OCCURS. IF THE SELLER DOES NOT HONOR THE WARRANTY, THE SELLER HAS BREACHED, OR BROKEN, HIS OR HER CONTRACT WITH THE CONSUMER. EXPRESS WARRANTIES AN EXPRESS WARRANTY IS A WRITTEN OR ORAL STATEMENT CONCERNING THE QUALITY, OR PERFORMANCE, OF GOODS OFFERED FOR SALE. THIS STATEMENT BECOMES PART OF THE BARGAIN BETWEEN THE PARTIES. FOR EXAMPLE, A SALESPERSON WHO SAYS THAT A CERTAIN TV WILL NOT REQUIRE REPAIRS FOR FIVE YEARS HAS OFFERED AN EXPRESS WARRANTY THAT IS ENFORCEABLE BY LAW. HOWEVER, NOT EVERYTHING THE SELLER SAYS IS AN EXPRESS WARRANTY. A SELLER'S MERE OPINION OR AN OBVIOUS EXAGGERATION—CALLED PUFFING—WILL NOT BE ENFORCED. IMPLIED WARRANTIES EVEN IF THERE IS NO WRITTEN WARRANTY, THE CONSUMER STILL HAS CERTAIN PROTECTIONS IF THE ITEM FAILS TO WORK PROPERLY OR FOR AN ADEQUATE LENGTH OF TIME. AN IMPLIED WARRANTY IS AN UNWRITTEN PROMISE, CREATED BY LAW, THAT ENSURES A PRODUCT WILL DO WHAT IT IS SUPPOSED TO DO. IN THIS WAY, THE LAW REQUIRES THAT PRODUCTS MEET CERTAIN STANDARDS. IMPLIED WARRANTIES DO NOT APPLY TO GOODS SOLD BY A CASUAL SELLER, SUCH AS A FRIEND SELLING A USED VIDEO GAME. THERE ARE THREE TYPES OF IMPLIED WARRANTY. A WARRANTY OF MERCHANTABILITY IS AN UNWRITTEN PROMISE THAT THE ITEM SOLD IS AT LEAST OF AVERAGE QUALITY FOR THAT TYPE OF ITEM. A WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE EXISTS WHEN A CONSUMER TELLS A SELLER WHAT THE SPECIFIC PURPOSE OF THE ITEM WILL BE. A SALESPERSON WHO SELLS AN ITEM WITH THIS KNOWLEDGE HAS CREATED AN IMPLIED WARRANTY THAT THE PRODUCT WILL WORK FOR THE STATED PURPOSE. A WARRANTY OF TITLE IS A SELLER'S PROMISE THAT HE OR SHE OWNS THE ITEM BEING OFFERED FOR SALE AND IS NOT SELLING STOLEN PROPERTY. DISCLAIMERS A DISCLAIMER IS AN ATTEMPT BY THE SELLER TO LIMIT RESPONSIBILITY TO THE CONSUMER IN CASE ANYTHING GOES WRONG. SELLERS CAN USUALLY DISCLAIM THE IMPLIED WARRANTY OF MERCHANTABILITY AS LONG AS THE DISCLAIMER IS EASILY VISIBLE AND IS WRITTEN IN TERMS THAT CAN BE EASILY UNDERSTOOD BY THE AVERAGE CONSUMER. OE 2 IDENTIFY CONSUMER PROTECTION AGENCIES (E.G., FEDERAL TRADE COMMISSION, BETTER BUSINESS BUREAU, AND CONSUMER PRODUCT SAFETY COMMISSION) AND EXPLAIN THEIR SERVICES
FOOD AND DRUG ADMINISTRATION (FDA) REGULATES THE LABELING AND SAFETY OF FOOD, DRUGS, AND COSMETICS SOLD THROUGHOUT THE UNITED STATES. CONSUMER PRODUCT SAFETY COMMISSION (CPSC) EQUAL EMPLOYMENT OPPORTUNITY COMMISSION (EEOC) RESPONSIBLE FOR THE FAIR AND EQUITABLE TREATMENT OF EMPLOYEES WITH REGARD TO HIRING, FIRING, AND PROMOTIONS OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION (OSHA) SETS GUIDELINES FOR WORKPLACE SAFETY AND ENVIRONMENTAL CONCERNS AND ENFORCES THOSE REGULATIONS. SECURITIES AND EXCHANGE COMMISSION (SEC) REGULATOR OF THE SALE OF SECURITIES (STOCKS AND BONDS). IT IS RESPONSIBLE FOR ISSUING LICENSES TO BROKERAGE FIRMS AND FINANCIAL ADVISERS AND INVESTIGATES ANY ACTIONS AMONG CORPORATIONS THAT AFFECT THE VALUE OF STOCKS. ENVIRONMENTAL PROTECTION AGENCY (EPA) PROTECTS HUMAN HEALTH AND OUR ENVIRONMENT. ITS RESPONSIBILITIES INCLUDE MONITORING AND REDUCING AIR AND WATER POLLUTION AND OVERSEEING RECYCLING AND HAZARDOUS WASTE DISPOSAL. FEDERAL TRADE COMMISSION (FTC) ENFORCES THE PRINCIPLES OF A PRIVATE ENTERPRISE SYSTEM AND PROTECTS CONSUMERS FROM UNFAIR OR DECEPTIVE BUSINESS PRACTICES. RESPONSIBLE FOR OVERSEEING THE SAFETY OF PRODUCTS SUCH AS TOYS, ELECTRONICS, AND HOUSEHOLD FURNITURE. BBB BETTER BUSINESS BUREAU THIS NON-PROFIT ORGANIZATION IS SPONSORED BY LOCAL BUSINESSES. IF OFFERS A VARIETY OF CONSUMER SERVICES AT NO CHARGE TO HELP WITH CONSUMER COMPLAINTS. IT CAN PROVIDE CONSUMER EDUCATION MATERIALS, ANSWER CONSUMER QUESTIONS, AND PROVIDE GENERAL INFORMATION ABOUT A COMPANY'S CONSUMER COMPLAINT RECORD. CPSC - THIS IS A FEDERAL AGENCY THAT WAS FORMED CONSUMER PRODUCT SAFETY COMMISSION TO SET AND ENFORCE SAFETY STANDARDS OF PRODUCTS SUCH AS HOUSEHOLD APPLIANCES, TOYS, AND TOOLS. IF A PRODUCT UNDER THE JURISDICTION OF THE CPSC IS FOUND TO BE HARMFUL OR HAZARDOUS, THEY CAN PREVENT THAT PRODUCT FROM BEING SOLD, OR THEY CAN REQUIRE THE MANUFACTURER TO REPAIR OR REPLACE THE PRODUCT. THE CPSC WILL ALSO INVESTIGATE COMPLAINTS FROM CONSUMERS ABOUT PRODUCTS. FEDERAL TRADE COMMISSION (FTC): THIS IS A FEDERAL AGENCY THAT WAS FORMED TO PROTECTCONSUMERS AGAINST FALSE ADVERTISING, ILLEGAL SALES SCHEMES, AND ALL UNFAIR TRADE PRACTICES. |
OE 5 EXPLAIN THE CONCEPT OF the product mix.
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DESCRIBE FACTORS (E.G., FEATURES/BENEFITS, PRICE/QUALITY, COMPETITION) USED BY MARKETERS TO POSITION PRODUCT/BUSINESS
•THE PURPOSE OF POSITIONING IS TO MAKE YOUR PRODUCT OR SERVICE STAND OUT IN A CROWD.
•POSITIONING IS IMPORTANT BECAUSE YOU ARE COMPETING WITH ALL THE NOISE OUT THERE COMPETING FOR YOUR POTENTIAL CUSTOMERS’ ATTENTION.
1. COMPANIES POSITION PRODUCTS BY FOCUSING ON FEATURES AND BENEFITS OF THE PRODUCT -
•PRODUCT FEATURE - A FACT OR TECHNICAL SPECIFICATION ABOUT A PRODUCT.
•PRODUCT BENEFIT – THE VALUE PROVIDED TO A CUSTOMER BY A PRODUCT FEATURE.
2. PRICE/QUALITY
3. COMPETITION
THERE ARE SEVEN POSITIONING STRATEGIES THAT CAN BE PURSUED:
•PRODUCT ATTRIBUTES: WHAT ARE THE SPECIFIC PRODUCT ATTRIBUTES?
•BENEFITS: WHAT ARE THE BENEFITS TO THE CUSTOMERS?
•USAGE OCCASIONS: WHEN/HOW CAN THE PRODUCT BE USED?
•USERS: IDENTIFY A CLASS OF USERS.
•AGAINST A COMPETITOR: POSITIONED DIRECTLY AGAINST A COMPETITOR.
•AWAY FROM A COMPETITOR: POSITIONED AWAY FROM COMPETITOR.
•PRODUCT CLASSES: COMPARED TO DIFFERENT CLASSES OF PRODUCTS.
BRAND DEVELOPMENT:A BRAND IS A NAME, SYMBOL, WORD, OR DESIGN THAT IDENTIFIES A PRODUCT, SERVICE, OR COMPANY. A TRADEMARK IS THE LEGAL PROTECTION OF THE WORDS OR SYMBOLS FOR USE BY A COMPANY. GROUPS OF PRODUCTS CAN CARRY AN IDENTICAL OR FAMILY BRAND. A WELL KNOWN SYMBOL ESTABLISHED BY ONE COMPANY AND SOLD FOR USE BY ANOTHER COMPANY TO PROMOTE ITS PRODUCTS IS A LICENSED BRAND.NATURE OF BRANDING.
A BRAND IS A VERY IMPORTANT PART OF A COMPANY BECAUSE IT PROVIDES A UNIQUE IDENTIFICATIONS FOR THE COMPANY AND ITS OFFERINGS. BRAND RECOGNITION PLAYS A BIG PART WHEN A COMPANY IS TRYING TO SELL THEIR PRODUCTS. THE LEVELS OF BRAND RECOGNITION ARE NON-RECOGNITION, REJECTION, RECOGNITION, PREFERENCE, AND INSISTENCE. NON-RECOGNITION IS WHEN CONSUMERS ARE UNABLE TO IDENTIFY A BRAND. REJECTION IS THE CONSUMERS WILL NOT PURCHASE THE PRODUCT BECAUSE OF THE BRAND. RECOGNITION IS WHEN THE CONSUMERS CAN RECALL THE BRAND, BUT IT HAS VERY LITTLE INFLUENCE ON THE PURCHASE. PREFERENCE IS THE CONSUMERS VIEW ON WHETHER OR NOT THE BRAND IS VALUABLE AND WILL CHOOSE IT IF IT IS AVAILABLE. LASTLY, INSISTENCE IS WHEN CONSUMERS VALUE THE BRAND TO THE EXTENT THAT THEY REJECT OTHER BRANDS.
BRANDMARK - UNSPOKEN PART OF BRAND - UNIQUE SYMBOL COLORING OR OTHER DESIGN ELEMENTS - (SWOOSH)
BRANDNAME - A WORD, GROUP OF WORDS, LETTERS OR NUMBERS THAT REPRESENT A PRODUCT OR COMPANY ALSO CALLED PRODUCT BRAND
TRADENAME - CORPORATE BRAND - IDENTIFIES AND PROMOTES THE CORPORATION - LEGALLY TRADED NAME (PEPSICO)
TRADE CHARACTER - TYPE OF BRAND MARK THAT IS A CHARACTER OR HUMAN FORM - PILLSBURY DOUGH BOY
BRANDING STRATEGIES
BRAND EXTENSION - A BRANDING STRATEGY THAT USES EXISTING BRAND TO PROMOTE A NEW PR IMPROVED PRODUCT IN THE COMPANY'S LINE - OCEAN SPRAY - CRANAPPLE OR CRANGRAPE
BRAND LICENSING - AUTHORIZES A LEGAL AGREEMENT FOR WHICH A FEE IS PAYED BY ONE COMPANY TO USE ANOTHER'S BRAND - NFL AND PEPSI
CO-BRANDING - TWO OR MORE COMPANIES BRAND A PRODUCT OR SERVICE TOGETHER - KELLOGS POP-TARTS WITH SMUCKERS FRUIT FILLING, OREO AND BRYERS ICECREAM
TYPES OF BRANDS
NATIONAL BRANDS - OR PRODUCER BRANDS - OWNED AND INITIATED BY NATIONAL MANUFACTURERS - HERSHEY FOODS
PRIVATE BRANDS - OR DEALER BRANDS - DEVELOPED AND OWNED BY THE WHOLESALERS AND RETAILERS - WAL MART'S GEORGE BRAND.
GENERIC BRANDS - DO NOT CARRY COMPANY IDENTITY - LOW PRICE
•THE PURPOSE OF POSITIONING IS TO MAKE YOUR PRODUCT OR SERVICE STAND OUT IN A CROWD.
•POSITIONING IS IMPORTANT BECAUSE YOU ARE COMPETING WITH ALL THE NOISE OUT THERE COMPETING FOR YOUR POTENTIAL CUSTOMERS’ ATTENTION.
1. COMPANIES POSITION PRODUCTS BY FOCUSING ON FEATURES AND BENEFITS OF THE PRODUCT -
•PRODUCT FEATURE - A FACT OR TECHNICAL SPECIFICATION ABOUT A PRODUCT.
•PRODUCT BENEFIT – THE VALUE PROVIDED TO A CUSTOMER BY A PRODUCT FEATURE.
2. PRICE/QUALITY
3. COMPETITION
THERE ARE SEVEN POSITIONING STRATEGIES THAT CAN BE PURSUED:
•PRODUCT ATTRIBUTES: WHAT ARE THE SPECIFIC PRODUCT ATTRIBUTES?
•BENEFITS: WHAT ARE THE BENEFITS TO THE CUSTOMERS?
•USAGE OCCASIONS: WHEN/HOW CAN THE PRODUCT BE USED?
•USERS: IDENTIFY A CLASS OF USERS.
•AGAINST A COMPETITOR: POSITIONED DIRECTLY AGAINST A COMPETITOR.
•AWAY FROM A COMPETITOR: POSITIONED AWAY FROM COMPETITOR.
•PRODUCT CLASSES: COMPARED TO DIFFERENT CLASSES OF PRODUCTS.
BRAND DEVELOPMENT:A BRAND IS A NAME, SYMBOL, WORD, OR DESIGN THAT IDENTIFIES A PRODUCT, SERVICE, OR COMPANY. A TRADEMARK IS THE LEGAL PROTECTION OF THE WORDS OR SYMBOLS FOR USE BY A COMPANY. GROUPS OF PRODUCTS CAN CARRY AN IDENTICAL OR FAMILY BRAND. A WELL KNOWN SYMBOL ESTABLISHED BY ONE COMPANY AND SOLD FOR USE BY ANOTHER COMPANY TO PROMOTE ITS PRODUCTS IS A LICENSED BRAND.NATURE OF BRANDING.
A BRAND IS A VERY IMPORTANT PART OF A COMPANY BECAUSE IT PROVIDES A UNIQUE IDENTIFICATIONS FOR THE COMPANY AND ITS OFFERINGS. BRAND RECOGNITION PLAYS A BIG PART WHEN A COMPANY IS TRYING TO SELL THEIR PRODUCTS. THE LEVELS OF BRAND RECOGNITION ARE NON-RECOGNITION, REJECTION, RECOGNITION, PREFERENCE, AND INSISTENCE. NON-RECOGNITION IS WHEN CONSUMERS ARE UNABLE TO IDENTIFY A BRAND. REJECTION IS THE CONSUMERS WILL NOT PURCHASE THE PRODUCT BECAUSE OF THE BRAND. RECOGNITION IS WHEN THE CONSUMERS CAN RECALL THE BRAND, BUT IT HAS VERY LITTLE INFLUENCE ON THE PURCHASE. PREFERENCE IS THE CONSUMERS VIEW ON WHETHER OR NOT THE BRAND IS VALUABLE AND WILL CHOOSE IT IF IT IS AVAILABLE. LASTLY, INSISTENCE IS WHEN CONSUMERS VALUE THE BRAND TO THE EXTENT THAT THEY REJECT OTHER BRANDS.
BRANDMARK - UNSPOKEN PART OF BRAND - UNIQUE SYMBOL COLORING OR OTHER DESIGN ELEMENTS - (SWOOSH)
BRANDNAME - A WORD, GROUP OF WORDS, LETTERS OR NUMBERS THAT REPRESENT A PRODUCT OR COMPANY ALSO CALLED PRODUCT BRAND
TRADENAME - CORPORATE BRAND - IDENTIFIES AND PROMOTES THE CORPORATION - LEGALLY TRADED NAME (PEPSICO)
TRADE CHARACTER - TYPE OF BRAND MARK THAT IS A CHARACTER OR HUMAN FORM - PILLSBURY DOUGH BOY
BRANDING STRATEGIES
BRAND EXTENSION - A BRANDING STRATEGY THAT USES EXISTING BRAND TO PROMOTE A NEW PR IMPROVED PRODUCT IN THE COMPANY'S LINE - OCEAN SPRAY - CRANAPPLE OR CRANGRAPE
BRAND LICENSING - AUTHORIZES A LEGAL AGREEMENT FOR WHICH A FEE IS PAYED BY ONE COMPANY TO USE ANOTHER'S BRAND - NFL AND PEPSI
CO-BRANDING - TWO OR MORE COMPANIES BRAND A PRODUCT OR SERVICE TOGETHER - KELLOGS POP-TARTS WITH SMUCKERS FRUIT FILLING, OREO AND BRYERS ICECREAM
TYPES OF BRANDS
NATIONAL BRANDS - OR PRODUCER BRANDS - OWNED AND INITIATED BY NATIONAL MANUFACTURERS - HERSHEY FOODS
PRIVATE BRANDS - OR DEALER BRANDS - DEVELOPED AND OWNED BY THE WHOLESALERS AND RETAILERS - WAL MART'S GEORGE BRAND.
GENERIC BRANDS - DO NOT CARRY COMPANY IDENTITY - LOW PRICE