Product

Question 1

What are important factors in creating a new product?

Answer 1

Important factors when creating a new product?

• Product Design - features
• Product image - eg young vibe
• Target market - eg young/techy

Question 2

How can you differentiate your product (ie how can you make your product different from the competition)

Answer 2

You can DIFFERENTIATE your product by:

• USP - eg mobiles do this with a special techy feature
• create a BRAND IMAGE - I am so cool I only want to be seen with a iphone

Question 3

What is the product life cycle?

Answer 3

The product life cycle:

• shows how the DEMAND for a product of service CHANGES over TIME

Question 4

Stages of a PRODUCT LIFE CYCLE

Answer 4

The stages of a product life cycle:

• Research & Development - prototypes only - high development costs
• Introduction - first product launched on market - high advertising costs
• Growth - could be high sales & profits - still high advertising costs
• Maturity - The peak of sales reached - advertisement costs can be reduced because product is well known
• Decline - sales fall off
• Extension Strategies - to give the product a longer life in the market by adding additional/new features to create interest and sales

Question 5

How can you EXTEND THE LIFE OF A PRODUCT - by using extension strategies:

Answer 5

You can extend the life of a product (so it continues to be bought by)

• Update the PACKAGING - making it stand out - trendy colours - this is quite cheap to do
• Add NEW FEATURES or improve ones
• Change the PRODUCTS IMAGE - get an influencer to promote it
• Change the TARGET MARKET - eg a previous hi-tech item may in time be attractive to the older market segment
• Price REDUCTION - may make the product attractive to a different segment - eg pensioners