Business OutlineEssay Preview: Business OutlineReport this essayAmanda Staubitz1/6/07Mr. DelmanPeriod 1 ScaleChapter 11 OutlineBUSINESSChapter 11: Developing and Pricing ProductsWhat is a product?Product: value packageIn developing the marketing mix for any product, whether goods or services, marketers must consider what consumers really buy when they purchase products.
The Value PackageFeature: tangible and intangible qualities that a company builds into a productValue package: product marketed as a bundle of value-adding attributes, including reasonable costIncreasingly buyers expect to receive products with greater value–with more benefits at reasonable costs.Classifying Goods and ServicesClassifying products according to expected buyers into 2 groups:Consumer ProductsIndustrial ProductsClassifying Consumer ProductsConvenience goods and services: are consumed rapidly and regularly. They are inexpensive and are purchased often.Shopping Goods and Services: are more expensive and are purchased less often than convenience products. Consumers often compare brands, sometimes in different stores.
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Receive 1 extra lb of food from your home
The Value PackageFeature: tangible characteristics that a company builds as a productValue package: product marketed as a bundle of value-adding attributes, including fair value-attainment measures, reasonable price, and/or reasonable value-attainment measures
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Send 500/500 lb of food to your house
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Receive 1 extra lb of food from your home
The Value PackageFeature: tangible characteristics that a company builds as a productValue package: product marketed as a bundle of value-adding attributes, including fair value-attainment measures, reasonable price, and/or reasonable value-attainment measures
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Send 500/500 lb of food to your house
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Receive 1 extra lb of food from your home
The Value PackageFeature: tangible characteristics that a company builds as a productValue package: product marketed as a bundle of value-adding attributes, including fair value-attainment measures, reasonable price, and/or reasonable value-attainment measures
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Send 500/500 lb of food to your house
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Specialty goods and services: are extremely important and expensive purchases. Consumers usually decide on precisely what they want and will accept no substitutes.
Classifying Industrial ProductsExpense items: are goods or services that are consumed within a year by firms producing other goods or supplying other services.Capital items: are permanent, expensive, long-lasting, goods and services.The Product MixThe group of products that a company makes available for sale, whether consumer, industrial or both, is it product mix: Group of products that a firm makes available for sale.
Product LinesProduct Line: group of products that are closely related because they function in a similar manner or are sold to the same customer group who will use them in similar ways
Companies may extend their horizons and identify opportunities outside existing product lines.The result is multiple of diversified product lines.Developing New ProductsTo expand or diversify product lines firms must develop and introduce streams of new products.The New Product Development ProcessHigh mortality rates for new ideas means that only a few new products reach the market.Speed to market with a product is as important as care in developing it.Product Mortality RatesIt is estimated that it takes 50 new product ideas to generate one product that finally reaches the market.Speed to MarketStrategy of introducing new products to respond quickly to customer or market changes.The Seven-Step Development ProcessProduct IdeasScreeningConcept testingBusiness analysisPrototype developmentProduct testing and test marketingCommercializationVariations in the Process for ServicesService ideas: the search for service ideas includes defining the service package: identifying the tangible and intangible features that characterize the service and stating service specifications.
Service Process Design: Instead of Prototype development, services require a three-part service process design: Three Aspects (process selection, worker requirements, facilities requirements) of developing a service product
The Product Life CycleProduct Life cycle (PLC) a series of stages in a products profit-producing lifeStages in the Product Life CycleIntroductionGrowthMaturityDeclineExtending Product Life: An Alternative to New ProductsProduct Extension: existing, unmodified product that is marketed globallyProduct Adaptation: product modified to have greater appeal in foreign marketsReintroduction: process of reviving, for new markets, products that are obsolete in older onesIdentifying ProductsBranding ProductsBranding is a process of suing symbols to communicate the qualities of a particular product made by a particular producer.Adding Value through Brand EquityBrand equity: degree of consumers loyalty to and awareness of a brand and its resultant market shareBrand awareness: extent to which a brand name comes to mind when the consumer considers a particular product categoryE-Business BrandingIt takes a long time to establish national or global brand recognitionCisco Systems Inc, B2B, E-commerceTypes of Brand NamesNational
