Cours 8 Flashcards
What are continuous innovations?
They propose new characteristics that do not necessarily call for redefining the product category.
What is an example of continuous innovation?
A new Colgate toothpaste
What is a discontinuous innovation?
Discontinuous innovations are new products, ideas, or services that disrupt established habits or create a new category. It is rare. (ex computers)
What are the categories of adopters of innovations?
- Innovators (2.5%)
- Early adopters (13.5%).
- Early majority (34%)
- Late majority (34%)
- Laggards (16%)
What are innovators?
- They appreciate innovation for its own sake.
- They are motivated by the status of agents of change in their social circles.
- They seek out communities of innovators.
- They accept and tolerate imperfections of innovation.
What are early adopters?
- They adopt and use innovations to make significant improvements (revolution).
- The significant risks and rewards of innovations attract them.
- They are insensitive to price.
- They may demand personalized solutions and quick and efficient support.
What is the early majority?
- They are motivated by evolution, change, and improving productivity.
- They want proven, tested solutions.
- They want to reduce risks.
What is the late majority?
- They adopt innovations to keep up to date.
- They do not want to take risks.
- They are not very interested in technology.
- They are price sensitive.
- They seek solutions that are ready to use, and very certain.
What are the laggards?
- They want to preserve the status quo.
- They don’t think innovations improve productivity.
- They purchase the product only when all other options are less interesting.
What five factors are usually identified as facilitating or hindering adoption?
- Relative advantage: the product’s relative advantage is the first facilitator.
- Compatibility: compatibility with the usual way of doing things.
- Triability: how easily the innovation can be tried out.
- Observability: observability of innovations also facilitates their diffusion.
- Perceived complexity: a new product that seems complicated to use discourages potential users.
Give examples of failures related to a product.
- Overestimation of the market.
- Flawed design.
- Poor positioning on the market.
- Pricing errors.
- Ill-designed sales communication.
- Production orientation rather than customer orientation.
- Cost overruns.
- Competition
What is a product?
It is a basket of benefits offered to consumers.
What is a service?
It is an action or effort offered by one party to another.
What characteristics of services differentiate them from other types of products?
- Intangibility: the service cannot be touched
- Inseparability is when production is tied to consumption, often linked to a particular provider.
- Variability: It implies that the quality depends on who offers the service and when, where, and how it is provided.
- Perishability: it comes from the fact that a service, such as a portion of a concert, cannot be stored until demand increases.
What is the core product?
It is what is concretely offered to consumers to provide the benefits they seek. It consists of design, packaging, quality, and brand attributes.
What is the packaging?
The concept of packaging includes the function and form of the container that holds the product.
What are the 2 angles to define product quality?
Technical and perceptual dimensions.
Describe the technical dimension.
- Performance: the product’s capacity to adequately perform the tasks for which it was designed.
- Reliability: the likelihood that a product will fail.
- Conformity: the capacity to meet the product design specifications.
- Durability: how long the product can be used before it deteriorates.
What is the perceived quality?
It is the gap between consumers’ expectations and the qualities they observe.
What are the five important dimensions in evaluating the quality of service regarding SERVQUAL?
- Reliability: in a service context, this refers to the ability to perform the promised service dependably and accurately.
- Responsiveness: willingness to help customers and provide prompt service.
- Assurance: knowledge and courtesy of employees and their ability to convey trust and confidence.
- Empathy: provision of caring, individualized attention to customers.
- Tangibles: the appearance of physical facilities, equipment, personnel, and communication materials.
What is a brand?
All materials signs allow a product, business, or organization to differentiate its offer from the competition.
What are related services?
They include guarantees, installation, delivery, credit, and after-sales service.
What is a product portfolio?
They are all products offered by a company.
What are product ranges?
It is a set of products of the same category or that meet the same need. A range is made up of product lines.
What is a product line?
It is a group of products intended for a specific market, or that solve a particular problem for the consumer.
How can you describe a range?
- Width: number of lines that make up that range.
- Depth: number of models per line.
- Length: total number of products in the range.
What is marketing cannibalization?
It is the current product sales drop caused by sales of a new product launched by the same company.
What is a private label?
It is a brand developed by and marketed for a retailer and distributed in that retailer’s stores exclusively.
What are the types of approaches for a brand’s equity?
- Customer-based approach.
- Price differential approach.
- Income-based approach.
What is a brand’s equity?
It is the added value that a brand gives a product.
Describe the customer-based approach.
This approach can involve surveys to directly evaluate loyalty, awareness, perceived quality, and brand associations.
Describe the differential price approach.
This more indirect approach measures the price differential associated with a specific brand.
Describe the income-based approach.
It determines the proportion of the company’s future income attributable to the brand.
What are the two types of brand portfolio management?
- Umbrella brand: a brand whose name and signs appear on all products a particular company sells.
- House of brands: each brand in the portfolio is treated independently.
What is cobranding?
It is a particular case f extension where at least 2 brands partner to market a new product, line, or range.
What is the main phase of a product life cycle?
- Introduction phase
- Growth phase
- Maturity phase
- Decline phase
What is the introduction phase?
It is a phase where sales usually progress slowly, and profits are limited. It can also lead to financial loss.
What is the growth phase?
More consumers join innovators, and competition intensifies.
What is the maturity phase?
Maret growth begins to stagnate; some competitors leave due to declining profits. The late majority buys the product, and previous segments may rebuy it.
Describe the declining phase and its 4 options.
It is the most difficult phase to manage because it’s the decline of a product category. The four options are:
- Take advantage of the competitive advantage if there is one.
- The company may decide to boost its profits by investing as little as possible in the products.
- A company may shrink its ranges to serve a more worthwhile niche.
- A company may withdraw from the market by selling a brand.
