Principles of Marketing chapter 9 & 10

Product
Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need.
Levels of a Product
1. Core customer value
2. Actual product
3 Augmented product
Diffusion of Innovations
1. Innovators – 2.5%
2. Early adaptors – 13.5%
3. Early Majority – 34%
4. Late majority – 34%
5. Laggards – 16%
Factors Affecting Rate of Adoption
1. Communicability
2. Divisibility
3. Complexity
4. Compatibility
5. Relative Advantage
Types of new Products
-New to the world
-New product categories
-Product line extensions
-Product improvements
-Repositioning
New Product Development Process
1. Idea generation
2. Idea screening
3. Concept development
4. Market Strategy development
5. Business Analysis
6. Product development
7. Test Marketing
8. Commercialization
Idea generation
Initial Stage of the new product development process where ideas are usually not very elaborate.
Ideas may come from many sources, including customers, internal agents, competitors, and suppliers.
Idea Screening/ Concept Development
-During idea screening, the original pool of ideas is evaluated and reduced to a smaller set.
-Ideas that are not likely to be successful are weeded out, as well as those that do not fit the company’s vision, objectives, or capabilities.
-The product is described in detail and concept tests are conducted with consumers to determine their opinions about the product.
Marketing Strategy Development/ Business Analysis
-Preparing an initial marketing plan for the product to determine profitability
-Estimates are made of expected sales, manufacturing and marketing costs, and profits.
– impact of product on other products in the product mix is made
Product Development
-Idea is made into a prototype for further testing.
-Testing determines: whether the product satisfies the necessary consumer needs. Whether the product has the necessary quality.
-Due to high costs, ideas at this stage have high probability of success.
Market testing
Testing the prototype and marketing strategy on small groups of people:
-Simulated test marketing
-Standard test marketing
Commercialization
-Product is introduced on a full-scale basis
-Investment and risk is highest at this stage; therefore it is critical that all previous steps be conducted effectively
Why Products Fail
-Insignificant “point of difference”
-incomplete market/ product definition
-little market attractiveness
-poor execution of the 4 p’s
-poor product quality
-bad timing
-no economical access to buyers
Branding
-Activity in which organizations use names, phrases, design, and symbols to identify their products and distinguish them from competitors
Brand Equity
The dollar amount attributed to the value of the brand, based on all the intangible qualities that create the value.
Brand Sponsership
1.Manufacturer branding:
-Multiproduct
-multibrand
2.Private Branding:-Private-mixed
3.Licensing
4.Co-Branding
Packaging
Involves designing and producing the container or wrapper for a product.
Functions of packaging
1.Containment
2.Usage facilitation
3.Promotion
4.Ecology
Labels
Identify the product or brand, describes attributes, and provides promotion.