Lecture 9 Product Flashcards
Define product
Anything that can be offered in a market for attention, acquisition, use or consumption that might satisfy a need or want
Define service
A product that consists of benefits, activities, or satisfactions that is essentially intangible and does not result in the ownership of anything
What does the actual product entail?
Brand name Features Design Packaging Quality level
What does the augmented product entail?
After-sale service
Warranty
Product support
Delivery and credit
What are consumer products?
Products and services bought by the final consumers for personal consumption
Give 5 types of consumer products
Convenience products Shopping products Speciality products Unsought products Industrial products
Define convenience products
Customer usually buys frequently, immediately and with a minimum comparison and buying effort
Give two examples of convenience products
Newspapers
Fast food
Define shopping products
These are less frequently purchased consumer products and services that the customer compares carefully on suitability, quality, price and style
Give three examples of shopping products
Furniture
Cars
Appliances
Define speciality products
Consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort
Give 3 examples of speciality products
Medical services
Designer clothes
High-end electronics
Define unsought products
Consumer products that the consumer does not know about or knows about but does not normally think about buying
Give 3 examples of unsought products
Life insurance
Funeral services
Blood donations
Define industrial products
Products purchased for further processing or for use in conducting a business
Give 3 examples of industrial products
Materials and parts
Capital items
Supplies and services
What are 4 other marketing offerings that marketers should consider when broadening the concept of a product?
Organisations
Persons
Places
Ideas
Define organisation marketing
Consists of the activities undertaken to create, maintain, or change the attitudes and behaviour of target consumers toward an organisation
Define person marketing
This consists of activities undertaken to create, maintain or change the attitudes or behaviour of target consumers toward particular people
Define place marketing
This consists of activities undertaken to create, maintain or change attitudes and behaviour toward particular places
Define social marketing in terms of organisations, people and ideas
Uses commercial marketing concepts to influence individuals’ behaviour to improve their well-being and that of society
What are three product and service attributes?
Quality
Features
Style and design
Explain what is meant by the product and service attribute
Quality, features, style and design
Explain what is meant by the product quality attribute
Total quality management, return-on-quality, quality level, performance quality, conformance quality
Explain what is meant by the product features attribute
Competitive tool for differentiating a product from competitors’ products
Assessed based on the value to the customer versus its cost to the company
Explain what is meant by the social marketing attribute
This uses commercial marketing concepts to influence individuals’ behaviour to improve their well-being and that of society
What does product quality refer to?
The characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs
What are 5 factors of product quality?
Total quality management Return-on-quality Quality level Performance quality Conformance quality
What does style describe?
The appearance of the product
What does design contribute to?
A product’s usefulness and its looks
What is brand?
This is the name, term, sign or design or a combination of these, that identifies the maker or seller of a product or service
What does packaging involve?
Designing and producing the container or wrapper for a product
What do labels do?
Identify the product or brand, describe the attributes and provide promotion
What do product support services do?
They augment actual products
What are product line decisions?
These are a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets or fall within given price ranges
What is product line length?
The number of items in the product line
What are two things that can be done to the product line length?
Line stretching
Line filling
What does the product mix consist of?
All the product lines and items that a particular seller offers for sale
What are 4 features of product mix decisions?
Width
Length
Depth
Consistency
What are the 3 main types of service industry?
Government
Private or not-for-profit organisations
Business organisations
What are the 4 features of services?
Intangibility
Variability
Inseparability
Perishability
What is meant by intangibility in terms of services?
Services cannot be seen, tasted, felt, heard or smelled before purchase
What is meant by variability in terms of services?
Quality of service depends on who provides them and when, where and how
What is meant by inseparability in terms of service?
Services cannot be separated from their providers
What is meant by perishability in terms of services?
Services cannot be stored for later sale or use
What are 3 additional strategies that firms often need in addition to traditional marketing strategies?
Service-profit chain
Internal marketing
Interactive arketing
What does service-profit chain marketing do?
It links service firm profits with employee and customer satisfaction
What are 5 features of service-profit chain links?
Internal service quality Satisfied and productive service employees Greater service value Satisfied and loyal customers Healthy service profits and growth
What is internal marketing?
Promoting the organisation’s goals, products and services to the employees within the organisation so that they can advocate for the business
What is interactive marketing?
This is marketing on a one-to-one basis that responds to the actions of individual customers
What are two product development strategies?
Acquisition
New product development
What is meant by acquisition in terms of it being a product development strategy?
This refers to the buying of a whole company, patent or license to produce someone else’s product
What are the 8 steps in the new product development process?
1- idea generation 2- idea screening 3- concept development and testing 4- marketing strategy development 5- business analysis 6- product development 7- test marketing 8- commercialization
What is involved in idea generation?
Creating lots of good new product ideas
What is involved in commercialization?
These are the remaining steps that reduce the number of ideas and develop only the best ones into profitable products
Define idea generation
The systematic approach to search for new product ideas
Who can be involved in idea generation?
Internal
External
Crowdsourcing
Define idea screening
Identifying good ideas and dropping poor ideas
What framework is used in idea screening?
R-W-W
What does R-W-W stand for?
Is it real, can we win, is it worth doing?
Define concept development and testing
This refers to testing new product concepts with groups of target consumers
What are 3 components of concept development and testing?
Product idea
Product concept
Product image
What is meant by product idea in terms of concept development and testing?
A possible product that the company can see itself offering to the market
What is meant by product concept in terms of concept development and testing?
A detailed version of the idea stated in meaningful consumer terms
What is meant by product image in terms of concept development and testing?
This is the way in which consumers perceive an actual or potential product
Define marketing strategy development
Designing an initial marketing strategy for a new product based on the product concept
What is involved in the marketing development strategy?
Target market description
Value proposition planned
Sales, market-share, and marketing mix
Define marketing strategy development
This is designing an initial marketing strategy for a new product based on the product concept
What does the marketing strategy statement consist of?
Target market description
Value proposition planned
Sales, market share and marketing mix
What is business analysis?
This is a review of the sales, costs and profit projections for a new product to find out whether these factors satisfy the companies objectives
Define product development
This is developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering
Define test marketing
This is the stage of new product development in which the product and its proposed marketing program are tested in realistic market settings
What are the 5 stages of a product lifecycle?
Product development Introduction Growth Maturity Decline
What are the characteristics of the introduction stage in the product lifecycle?
Low sales High cost per customer Negative profits Customers are innovators Few competitors
What are the characteristics of the growth stage in the product lifecycle?
Rapidly rising sales Average cost per customer Rising profits Customers are early adaptors There are a growing number of competitors
What are the characteristics of the maturity stage in the product lifecycle?
Peak sales Low cost per customer High profits Customers are mainstream adopters Stable number of competitors that are starting to decline
What are the characteristics of the decline stage in the product life cycle?
Declining sales Low cost per customer Declining profits Customers are lagging adaptors Declining number of competitors
What is the main marketing objective in the introduction stage?
Create product engagement and trial
What is the main marketing objective in the growth stage?
Maximise market share
What is the main marketing strategy in the maturity stage?
Maximise profit whilst defending market share
What is the main marketing strategy in the decline stage?
Reduce expenditure and milk the brand
What sort of product is offered in the introduction stage?
Basic product offered
What sort of product is offered in the growth stage?
Offer product extensions, service and waranty
What sort of product is offered in the maturity stage?
Diversify brand and models
What sort of product is offered in the decline stage?
Phase out weak items
What sort of price is offered in the introduction stage?
Use cost-plus
What sort of price is offered in the growth stage?
Price to penetrate the market
What sort of price is offered in the maturity stage?
Price to match or beat competitors
What sort of price is offered in the decline stage?
Cut price
What sort of distribution is offered in the introduction stage?
Build selective distribution
What sort of distribution is offered in the growth stage?
Build intensive distribution
What sort of distribution is offered in the maturity stage?
Build more intensive distribution
What sort of distribution is offered in the decline stage?
Go selective and phase out unprofitable outlets
What sort of advertising is needed in the introduction stage?
Build product awareness among early adopters and dealers
What sort of advertising is needed in the growth stage?
Build engagement and interest in the mass market
What sort of advertising is needed in the maturity stage?
Stress brand differences and benefits
What sort of advertising is needed in the decline stage?
Reduce to a level needed to retain hard core loyals
What sales promotion is needed in the introduction stage?
Use heavy sales promotion to entice trail
What sales promotion is needed in the growth stage?
Reduce to take advantage of heavy customer demand
What sales promotion is needed in the maturity stage?
Increase to encourage brand switching
What sales promotion is needed for the decline stage?
Reduce to minimal level
