Chapter 1: Product Management Flashcards
1
Q
Product
A
sum of all tangible and intangible characteristics of a product
2
Q
Service
A
Immaterial products (no transfer of ownership)
3
Q
Product characteristics
A
- Property
- Visible
- Tangible
4
Q
Service characteristics
A
- Not your property
- Inseparable
- Unvisible
- Intangible
- Variability
- Transcience
5
Q
Product service continuum
A
enables marketers to see the relative goods/services composition of total products.
6
Q
Describe the three layers of a product
A
- core product
- actual product
- augmented product
7
Q
What step is involved between the core product and the actual product
A
communicating the core benefit:
- quality
- styling
- packaging
- brand name
- features
8
Q
What step is involved between the actual product and the augmented product
A
added value:
- installation
- aftersales service
- warranty
- delivery and credit
9
Q
Objective of developing a new product
A
VALUE CREATION to satisfy customer need
10
Q
Durable product
A
goods that do not need to be purchased very often and last for at least three years.
11
Q
Non durable product
A
products with a lifetime of less than three years.
12
Q
Consumer product
A
any article produced or distributed for sale to a consumer for the use, consumption, or enjoyment of such consumer.
13
Q
Industrial product
A
materials and services used to operate a business.
14
Q
FMCG
A
fast moving consumer goods
15
Q
CPG
A
consumer packaged goods
16
Q
Segments of consumer products
A
- convenience products
- shopping products
- specialty products
- unsought products
17
Q
What are the consumer products segmented in terms of?
A
decision & shopper process
18
Q
Characteristics of convenience products
A
- low involvement
- frequently bought
- fast moving (buying) without a lot of comparison
- low prices/high promotion & full distribution
19
Q
Example of convenience products
A
- routine products (ex: detergent, coffee)
- impulse products (ex: chocolate)
- emergency products (ex: stain remover)
20
Q
Characteristics of shopping product
A
- higher involvement - more search from the point of view of the consumer
- less frequently bought
- time for more thorough selection + comparison of brands on price, quality, fit, style
- often less distribution points (more exclusive) & more sales support/advice
21
Q
Example of shopping products
A
- furniture
- electronics
- clothing
22
Q
Characteristics of specialty products
A
- offering unique characteristics & benefits or having a special brand identity, that are triggering a substantial group of consumers (extra effort to buy product)
- price is less important
- less brand comparison
- often exclusive distribution
- more targeted promotions
23
Q
Example of specialty products
A
- Sports cars
- designer clothing
- exotic perfumes
- luxury watches
- famous paintings
24
Q
Characteristics of unsought products
A
- consumers often know the product but are less interested in buying or using the product
25
What is necessary for unsought products to succeed?
lots of brand communication, personal selling & other marketing activities (sometimes even rather aggressive)
26
Segments of special products
- organisations product segmentation
- people product segmentation
- places product segmentation
- ideas product segmentation
27
Organisation segmentation
organisation marketing = all activities to create attitudes & behaviour towards a specific organisation --> in profit- and non-profit sector
28
People segmentation
people marketing = all activities to create attitudes & behaviour towards a specific person
29
Places segmentation
marketing of cities, regions = all activities to create attitudes & behaviour towards a specific place/venue
30
Ideas segmentation
social marketing = developing and implementing marketing programs to stimulate the acceptance of a societal idea, way of living, etc.
31
Name the different types of product decisions
- decisions about individual products
- product group decisions
- decisions about the assortment/portfolio of products
32
What influences decisions about individual products?
- product characteristics
- brand
- packaging
- labelling
- product supporting service
33
Product characteristics that should be considered when developing a new product
- product quality (texture, perfume, etc)
- functions
- style/design
- weight/size
34
Importance of quality of a product
- good quality will lead to high customer satisfaction
- consistency of quality is important for retaining a customer base
35
Importance of function of a product
- USP
- insight for product expansion possibility (complimentary goods)
36
Which product characteristic, when used correctly, becomes an important weapon to compete in the market
product function
37
Which product characteristic, when used correctly, creates a strong product positioning
quality
38
Importance of style/design of a product
differentiating your product
39
Characteristics of a good design
- catches the attention
- improves product performance
- decreases production costs
- gives a competitive advantage to the produce
40
Importance of weight/size of a product
differentiating your product
41
Name the different types of brand decisions
- brand
- no brand
42
'Brand' brand decision
A brand product is sold under the name of the company.
43
'No Brand' brand decision
A non-brand product is sold under the name of a shop or under the name of the product itself, rather than the name of the company that made it
44
Functions of a packaging (packaging decisions)
- Grab the attention (size, shape, colour, material, text, logo)
- describe the product (information)
- protect the product
- selling!
45
Functions of labels
- provides an identity to the product or brand
- conveys quality
- describes different functions of the product
- can be used to communicate a promotion
46
Product supporting services
additional services with regard to a specific product with focus on service before/after, including maintenance, repair, ...
47
Product group
group of products that are closely linked to each other
48
Characteristics of product group
- Offer same function
- are sold to same customer groups
- meet the same needs of customer groups
- are distributed by the same channels
- are part of the same price category
- have the same production process
49
Assortment
Total range of product groups, products, product varieties and brands a company is selling
50
Each product has its own marketing strategy, where decisions have to be taken with regard to:
- Length (range) and depth of the product group
- Core product in the group
51
What influences length (range) of a product group
- positioning strategy
- profit targets (High profit on ST > limited length)
- upselling
- cross-selling
52
Upselling
a sales strategy that involves encouraging customers to buy a higher-end version of a product than what they originally intended to purchase.
53
Cross selling
the sales tactic whereby customers are enticed to buy items related or complementary to what they plan to purchase.
54
Upselling example
Iphone 14 Pro, Sizes of portions (fries, wings)
55
Cross selling example
McMenu
56
Reasons to add new products
- excess production capacity
- resellers ask for more SKU's to satisfy consumers
- New opportunities/segments in the market
57
Costs of adding new products
- Development & design result in extra investments
- Inventory costs will increase
- Production switchers
- Extra promotions
58
Characteristics of assortment
- width
- length
- depth
- consistency
59
Width of assortment
number of product groups
60
Length of assortment
total number of articles
61
Depth of assortment
number of varieties of each product in a product group
62
Consistency of assortment
relationships between various products (ex: end usage, same distribution channels, ...)
63
NPD
new product development
