Week 5 - Product Policy

Question 1

What is product positioning?

Answer 1

Creating an image of product
in consumer mind
consistent with their needs/wants/desires.

Question 2

What is overpositioning?

Answer 2

too narrow of a brand

potential customer think it’s too expensive, too cheap, too bold, etc

Question 3

what is underpositioning?

Answer 3

image is too vague

potential customers think there’s nothing special

Question 4

what is confused positioning?

Answer 4

more than one competing image

no clear image in consumer mind

Question 5

what is doubtful positioning?

Answer 5

consumers do know the image
but don’t believe it

worst place to be

Question 6

what is differentiation

Answer 6

a strategic approach
to
positioning products as meaningfully different

Question 7

what is effective differentiation?

Answer 7

important - valued by customers
distinctive - true difference perceived by customers
superior - not just different
preemptive - not easy to copy (sustainable competitive advantage)
affordable - value vs cost
profitable - cost must not be too high

Question 8

what are the 5 strategies for differentiation?

Answer 8

product
service
personnel
channel
image

Question 9

what is product differentiation?

Answer 9

make product better (attributes)

examples
form - physical
features - supplimentary benefits
performance quality - better
conformance quality - consistency
durability - longer operating life
reliability - low failure rate
repairability - easy to fix problems
IP protection - legally preemptive

Question 10

what is service differentiation?

Answer 10

adding services beyond a product

examples
ordering ease - reducing issues
delivery - easy to purchase and start using
installation
customer training - if needed
maintenance / repair 
rewards

Question 11

what is personnel differentiation?

Answer 11

employees as a means of value creation
frequently used to differentiate services

examples
competence - superior skills
courtesy
credible - trustworthy
reliable
responsive
communication - understandable

Question 12

what is channel differentiation?

Answer 12

partnerships = two is better than one

examples
associations - affiliations with positive brands
partnerships - formal relationships with another brand

Question 13

what is image differentiation?

Answer 13

build a brand image

examples
identity - strong symbol association
personality - human characteristics associated w/ brand
atmosphere - physical space

Question 14

what are the three product levels?

Answer 14

how products are described

core benefit - most basic reason to purchase
actual product - core benefit + associated features
augmented product - actual plus intangibles (service, warranty, delivery, installation, etc)

Question 15

what is durable vs nondurable products?

Answer 15

durable - multiple uses over time
nondurable - brief period, sometimes single use

3 years is a common dividing point, but is flexible

Question 16

what is the product life cycle?

Answer 16

model to demonstrate product sales over time
showing common stages in product life cycle

controversal, but very common and well known

Question 17

what happens in the product life cycle?

Answer 17

sales curve
profit curve

new product dev (sales 0, profits negative)
introduction (sales growing, overall negative)
growth (breakeven)
maturity (peak, start declining)
decline (rapid decrease)

Question 18

what’s wrong with the product life cycle model?

Answer 18

often wrong

fads, styles, and fashions can be different
not always a smooth curve
maturity can be extended at times
a “second life” can happen

useful for ways of thinking, but not for sales forecasts

Question 19

what is the diffusion of innovation model?

Answer 19

useful for forecasting sales

normal distribution curve

Question 20

what are the stages in diffusion of innovation model?

Answer 20

innovators - 2.5% (risk takers)
early adopters - 13.5% (emulate innovators)
early majority - 34% (closes first half of adopters)
late majority - 34% (skeptical)
laggards - 16% (wait until traditional product goes away)

Question 21

what influences rate of adoption in the diffusion of innovation model?

Answer 21

complexity - too hard = slower adoption
relative advantage - better product = faster adoption
compatability - shorter, spikier curve
divisibility/trialability - faster adoption
communicatability - can someone tell me why I should (virality)
culture - does it fit the world I know?
discretionary income - do I have money for it?
distribution - can I actually get it?

Question 22

what 4 things do successful new products do?

Answer 22

profitable
competitive advantage
marketable
satisfy a new or poorly met need

Question 23

what are the main stages of new product development?

Answer 23

idea generation - new ideas
idea screening - first evaluation
concept
development - making a marketable concept
testing - pretesting on a target market
business analysis - financial stuff
product dev - prototype and production
test marketing - limited, controlled launch
commercialization - full introduction to target

Question 24

what are the reasons for product failure?

Answer 24

no real advantage
poor quality
inaccessible or insufficient market
lack of top management commitment

Question 25

what are the reasons for product elimination?

Answer 25

poor sales
incompatibility with organisation
poor market outlook

moviepass - did so well that it forced them to massively change
wasn’t financially viable at scale

Question 26

what is the goal of product management?

Answer 26

look for growth opportunities

Question 27

what are growth opportunities for product management?

Answer 27

Ansoff’s model (new product/new market)

market penetration - increase sales of existing product
product development - new product in existing market
market development - new market for existing product
product diversification - new product/new market

Question 28

what are line extensions?

Answer 28

using an old brand name
for a new product
in an old product category

Question 29

what are new brands?

Answer 29

new brand name
for new product
in new product category

Question 30

what are multi brand strategies?

Answer 30

new brand name
for new product
in old product category

Question 31

what are brand extensions?

Answer 31

old brand name
for new product
in new product category

Question 32

what are the main ways to grow through product management

Answer 32

line extension - old brand / old cat
brand extension - old brand / new cat
new brand - new / new
multi-brand - new brand / old cat

Question 33

what are the various types of line extensions?

Answer 33

line stretching - higher/lower/both change in price point
line filling - new product dissimilar from existing
product modification - quality, function, asthetic
product deletion - eliminate product

Question 34

what is a brand?

Answer 34

means of identifying
a product/service
from a particular provider

Question 35

what does branding consist of?

Answer 35

names, terms, signs, symbols, colors, design, or anything identifying an association

brand name - words to identify
brand mark - non-word identifiers
trade name - legally protected name
trade mark - legally protected non-word designation

Question 36

what is a brand image?

Answer 36

often described as a brand’s personality

often human-like

Question 37

what are the main types of brands?

Answer 37

national brands - widely recognized
reseller brands - “house” brand affiliated with reseller, not manufacturer
generic brands - no brand affiliation

Question 38

why do branding?

Answer 38

has to be increased value to the company

consumers often willing to pay more due to perceived quality and reduced risk

Question 39

what is brand equity?

Answer 39

the finanancial value of the strength of a brand

Question 40

what is brand loyalty?

Answer 40

when a consumer prefers one brand over others
associated with repeat purchases
reduces the need to find new customers