2. What is a Product?
A product is defined as anything that can be offered
in the market for attention, acquisition, use or
consumption that might satisfy a want or need of
customers.
A product can be goods, services, ideas, experiences,
events, persons, places, properties, organizations,
information etc.
Eg. mobile, computer, pen , noodles, vehicles, clothes,
service of doctor, haircutting etc.
4. Level of Product
Benefits and
satisfaction
After-Sales Services
Instillation
Warranty
DeliveryandCredit
Packaging
Brand
name
Features
Quality Styling
Augmented Product
Actual Product
Core Product
5. Level of Product
Core Products- a part of the total product that
the consumer is actually buying i.e. benefit
and satisfaction.
Actual Product- this includes the products
name, label, packaging, features, and a quality
level.
Augmented Product- is the part where the seller
provides additional services and privileges to
consumers who bought the product.
6. Classification Of Product
1. Consumer Product
• Convenience product : pen,
noodles, cigarette, tea etc.
• Shopping Product : clothes
, shoes, mobile, electronics
etc.
• Specialty product: car,
motorbike, Rolex watch,
gold , land and building etc.
• Unsought Product : gift
items, decorative items etc.
2. Industrial Product
• Raw materials: agricultural
products, minerals, timber
etc .
• Capital items : plant and
machinery, equipments,
land and building
• Service , parts and
accessories : fuel, parts,
repairing service etc.
7. • Branding is a part of
product mix which conveys
the features , image, values,
and benefits of product.
Branding
8. Brand is a name, term,
design, symbol, or any
feature identities ones
seller’s good or services
as distinct from those of
other seller. A brand may
Identify one item, a
family of items, or all
items of that seller.
Brand name is that part
of a brand which can be
spoken- including letters,
words and number.
9. Brand mark is the element
of a brand that is not made up of
words, but is often a symbol or
design.
Trademark is a legal designation
indicating that the owner has
exclusive use of a brand and
those others are prohibited by
law from using it.
Trade name is a full and legal
name of an organization such as
Toyota Company, rather than the
name of a specific product.
10. Packaging and Labeling
Package is a container used to protect,
promote, transport, and/or identify a product.
Packaging is that part of product planning, in
which company researches, designs, and
produces its package(s).
Label indicates the products’ brand name, the
company logo, ingredients, promotional
messages, inventory, manufacturing and expiry
date, instructions for use.
11. New Product Development Process
New Product : If customer consider it to be
significantly different from competitive
products in some relevant characteristics ,
then it is indeed a new product. ---WJ stanton
Types of new product:
1. Innovative product :original or unique
products which satisfy the unsatisfied needs.
They are costly and risky .
12. 2.Modified product : products are modified and
improved in terms of quality, performance, design ,
capacity etc.
3.Imitated Product : They are new to the organization
but are old to the market. They are similar to the
competitors ‘ product.
Types of new
product
Innovative Modified imitated
14. Stage 1: Idea Generation
• Internal idea sources:
– R & D
• External idea sources:
– Customers,
– competitors,
– distributors,
– Suppliers, agents
– Company staffs, sales force
– Consultants, researcher, universities etc.
New Product Development Process
15. New Product Development process
Stage 2: Idea Screening
• Ideas are evaluated
in terms of resources capability,
Policies, objectives etc.
• Ideas can be promising,
marginal and rejected .
16. Stage 3: Concept Development and Testing
• Product concepts provide
detailed versions of new
product with its uses and
benefits.
• Physical prototype or drawings
are prepared.
• Concept testing: Customer are
asked to evaluate the picture
or description of product .The
concept clarity, uniqueness
and attractiveness of concept
is measured through the
potential customer feedback.
New Product Development Process
17. Stage 4: Marketing Strategy Development
• Strategy statements are described in terms of
– The target market, product positioning, sales, market
share and profit for the first few years.
– Product price, distribution and promotion budget and
activities for the first year.
– Long-run sales and profit goals and the marketing mix
strategy.
New Product Development Process
18. Stage 5: Business Analysis
• Business attractiveness of product concept is
evaluated.
• Sales, cost, and profit
projections
• Competitors analysis
• Demand forecasting
• Break-even analysis
New Product Development Process
19. Stage 6: Product Development
• Product Concept is converted into physical
products (prototype)
• Lab. Tests are conducted
New Product Development Process
20. Stage 7: Test Marketing
– Sample production in limited scale
– Branding , packaging and labeling
– Customer’s preference
(Likes and dislikes to the product)
– Trial purchase, adoption
and frequency of purchase is
observed.
New Product Development Process
21. Stage 8: Commercialization
• full scale production
• Commercially launched in the target market
• Implementation of Pricing ,
distribution and promotion
strategy
New Product Development Process
22.
23. Product Life Cycle
• The sales history of a product from its birth to
death is called product life cycle.
• All products born, live and die with in a certain
period of time .
• Due to the changes in technology, changes in life
style and preferences of customer, competition ,
recession etc. may limit the life of product.
• Sales and profit rise and fall at different stages of
life cycle.
• Marketing strategies should be different in
different stages of product life.
25. Product Life-Cycle Strategies
• Product
development
• Introduction
• Growth
• Maturity
• Decline
• Begins when the
company develops a
new-product idea
• Sales are zero
• Investment costs are
high
• Profits are negative
PLC Stages
26. Product Life-Cycle Strategies
• Product
development
• Introduction
• Growth
• Maturity
• Decline
• Begins when the
company develops a
new-product idea
• Sales are zero
• Investment costs are
high
• Profits are negative
PLC Stages
27. Product Life-Cycle Strategies
• Product
development
• Introduction
• Growth
• Maturity
• Decline
• Low sales
• High cost per
customer acquired
• Negative profits
• Innovative customers
are targeted
• Little competition
• High price
PLC Stages
28. • Product – Offer a basic product
• Price – Use cost-plus basis to set, market
skimming or penetration strategy
• Distribution – Build selective distribution
• Promotion : Advertising – Build awareness
among early adopters and dealers/resellers
Sales Promotion – Heavy expenditures to create
trial
Marketing Strategies: Introduction
Stage
29. Product Life-Cycle Strategies
• Product
development
• Introduction
• Growth
• Maturity
• Decline
• Rapidly rising sales
• Average cost per
customer
• Rising profits
• Early adopters are
targeted
• Growing competition
• Slightly lower price
PLC Stages
30. • Product – Offer product extensions, improved
quality, service, warranty
• Price – Penetration pricing
• Distribution – Build intensive distribution
• Promotion : – Build awareness and interest in
the mass market, focus on increasing brand
loyalty, reduce sales promotion expenditure
Marketing Strategies:
Growth Stage
31. Product Life-Cycle Strategies
• Product
development
• Introduction
• Growth
• Maturity
• Decline
• Sales peak, constant
growth or slows down
• Low cost per customer
• High and stable profits
• Middle majority are
targeted
• Competition begins to
decline
• Low price
PLC Stages
32. • Product – Diversify brand and models
• Price – Set to match or beat competition
• Distribution – Build more intensive distribution
with new channel
• Promotion: Advertising – Stress brand differences
and benefits, focus on brand loyalty
Sales Promotion – Increase to encourage brand
switching
Marketing Strategies:
Maturity Stage
34. • Product – Phase out weak items
• Price – Cut price
• Distribution – Use selective distribution: phase
out unprofitable outlets
• Promotion: Advertising – Reduce to level
needed to retain loyal customer
Sales Promotion – Reduce to minimal level
Marketing Strategies: Decline Stage
35. Limitations of product life cycle
• Its only theoretical concept and can not be
applied in all product in the same way.
• The patterns of life cycle are various in
different product .
• The duration of each stage can not be
forecasted.
37. Product life cycle (Exception)
• Product life cycle vary from product to
product. It is affected by style, fashion and
fad.
• Style: may remain last long –going in and out
of trend
• Fashion: grow slowly, remain popular for a
while and decline slowly .
• Fad: rapidly grow and decline
