Creating The Product Flashcards
Product innovation and the value proposition
A better product is no guarantee that …
A product will succeed!
Why does 100% of the class have mobile phones, but nobody has google glasses?
Products must provide benefits that people actually seek, and google glasses didn’t
■ Google glasses had:
■ Safety and Health Concerns
■ Were Aesthetically Unappealing
■ Had No Clear Function
■ Were Socially alienating
The product is…
A bundle of attributes that includes the packaging, brand name, benefits and supporting features in addition to a physical good
Difference Tangible/Intangible product:
- A good is a tangible product, something that we can see, touch, smell, hear, taste or possess.
- In contrast, intangible products – services, ideas, people, places – are products that we can’t always see, touch, taste, smell or possess.
The core product consists of :
All the benefits the product will provide for consumers or business customers
However, Marketing is about …
supplying benefits, not products
Many products actually provide multiple benefits.
The actual product …..
The physical good or the delivered service that supplies the desired benefit. The actual product also includes the unique features of the product, such as its appearance or styling, the package and the brand name.
The augmented product is …
The actual product plus other supporting features such as:
- warranty,
- credit,
- delivery,
- installation
- and repair service after the sale.
The whole product:
Adding these supporting features to a product is an effective way for a company to stand out from the crowd.
What are the layers of Product Concept?
- Core Product
- Actual Product
- Augmented Product
HOW MARKETERS CLASSIFY PRODUCTS:
Marketers classify products into categories because the categories represent differences in how consumers and business customers feel about products and how they purchase different products. Such an understanding helps marketers develop new products and a marketing mix that satisfies customer needs.
Two kinds of products:
Generally, products are either consumer products or business-to-business products, although sometimes the same products – toilet paper, vacuum cleaners and light bulbs – are bought by consumers and businesses.
Difference Durable/Non-Durable goods:
- Durable goods are consumer products that provide benefits over a period of months, years or even decades, such as cars, furniture and appliances. (high involvement)
- Non-durable goods, such as newspapers and food, are consumed in the short-term. (low involvement)
Consumer products categories:
- Convenience product
- Shopping Product
- Speciality Product
- Unsought Products
Convenience Products:
A convenience product typically is a non-durable good or service that consumers purchase frequently with a minimum of comparison and effort. E.g. Staples such as milk, bread, toilet paper
- Low price
- Mass advertising
- Many purchase locations
- Low brand involvement
- Impulse purchase
- Emergency goods
- Fast moving
Shopping Products:
A shopping product is a good or service for which consumers will spend time and effort gathering information on price, product attributes and product quality.
- Less frequent purchase
- Higher price
- Fewer purchase locations
- Comparisons are used
- Moderate brand loyalty
- Attribute-based shopping products (clothes, hair etc.)
- Numerous store visits
Speciality products:
A speciality product has unique characteristics that are important to buyers at any price. Consumers usually know a good deal about specialty products and are loyal to specific brands
- Special purchase effort
- High price
- Brand identification
- Few purchase locations
Unsought Products:
Unsought products are goods or services (other than convenience products) for which a consumer has little awareness or interest until a need arises
- Little product awareness
- Aggressive/personal advertising
Unsought product marketing is often about…
Consumer education
- Make the product relevant
- Personal
- Heighten the importance of product
- Increase knowledge in consumer
Business-to-Business Products Categories:
- Equipment
- Maintenance, repair and operating (MRO products)
- Raw Materials
- Processed Materials
- Specialised services
- Component Parts
A continuous innovation is …
…a modification to an existing product.
This type of modification can set one brand apart from its competitors. The consumer doesn’t have to learn anything new to use a continuous innovation.
A knock-off is…
A new product that copies with slight modifications, the design of an original product.
A dynamically continuous innovation is …
A pronounced modification to an existing product that requires a modest amount of learning or change in behavior to use it.
Convergence =
Means the coming together of two or more technologies to create new systems that provide greater benefit than the original technologies alone.
A discontinuous innovation creates …
Major changes in the way we live. To use a discontinuous innovation, consumers must engage in a great amount of learning because no similar product has ever been on the market.
NEW-PRODUCT DEVELOPMENT:
- Product development can mean creating totally new products that have never before been on the market or looking for ways to make an existing product better.
- Competition in our global marketplace makes it essential for firms to continuously offer new choices for consumers if they are to compete with companies all around the world rather than just down the street
- Successful new-product introductions are becoming more and more difficult. The costs of research and development are often so huge that firms must limit the number of new products in development. Because products are outdated faster than ever, firms have less time torecover their research-and-development costs.
Product-creation Stages:
- Idea Generation
- Screening
- Concept Testing
- Business Analysis
- Product Development
- Test Marketing
- Commercialization
Tipping point =
A tipping point occurs when a product’s sales spike from a slow climb to unprecedented new levels – often accompanied by steep price declines.
Adoption Pyramid :
