PRODUCT MANAGEMENT NOTES

HITESH TANDON BITM

UNIT 1-3

UNIT- I
Q. Introduction

(a) Marketing Organization:

A marketing organization is a group of individuals who work together to create,

communicate, deliver, and exchange offerings that have value for customers, clients,
partners, and society at large. It typically includes various departments such as
market research, product development, advertising and promotion, sales,
distribution, and customer service. The primary goal of a marketing organization is to
identify and satisfy customer needs and wants through effective marketing strategies
and tactics.

Effective marketing organizations are agile, customer-centric, data-driven, and

focused on delivering value to customers. They leverage technology, analytics, and
insights to understand customer behavior, preferences, and expectations, and use
this information to create personalized and relevant experiences. A successful
marketing organization also fosters a culture of innovation, experimentation, and
continuous learning to stay ahead of the competition and drive growth.

(b) Variance across Industry:

Marketing practices and strategies vary across industries based on the nature of the
products or services, target markets, competition, regulatory environment, and
cultural factors. For example, a B2B company may focus on building relationships
with key decision-makers and influencers in the supply chain, while a B2C company
may focus on creating emotional connections with consumers through storytelling
and branding.

The digital age has also disrupted traditional marketing practices and created new
opportunities and challenges across industries. E-commerce and social media have
transformed the way consumers shop and interact with brands, while AI and machine
learning have enabled personalized marketing at scale. As a result, marketing
 organizations across industries are increasingly relying on data-driven insights and
agile methodologies to adapt to changing customer needs and preferences.

(c) Role and scope of a product manager:

A product manager is responsible for the strategy, development, and launch of a

product or product line. This includes identifying customer needs, defining product
features and requirements, working with cross-functional teams to develop and test
the product, and managing the product lifecycle from ideation to retirement.

The scope of a product manager's role may vary depending on the size and
complexity of the organization, but typically includes:

1. Customer research: Conducting market research and gathering customer

feedback to understand customer needs, preferences, and pain points.
2. Product strategy: Developing a product vision and roadmap based on
customer insights and market trends, and aligning it with the overall business
strategy.
3. Product development: Collaborating with cross-functional teams such as
engineering, design, and QA to develop and launch the product, ensuring that
it meets customer needs, is of high quality, and is delivered on time and within
budget.
4. Go-to-market planning: Developing a go-to-market strategy that includes
product positioning, pricing, promotion, and distribution.
5. Product performance tracking: Monitoring and analyzing product
performance metrics such as sales, customer satisfaction, and retention, and
making data-driven decisions to improve the product and drive growth.

Overall, the role of a product manager is critical to the success of a product and the
organization as a whole, as they are responsible for ensuring that the product meets
customer needs and delivers value to the business

Q2. Levels of Market Competition in product management?

In product management, the levels of market competition are similar to those in economics, but
with a focus on how they affect the development and positioning of a specific product. The four
levels of market competition in product management are:

1. Low competition: This is a market in which there are few or no direct competitors for a product.
In this situation, the focus for product management is on identifying and targeting the right
customer segments, as there is little pressure to differentiate the product from competitors.
2. Moderate competition: This is a market in which there are several competitors offering similar
products or services. Product management in this situation will focus on developing a unique
value proposition for the product that sets it apart from competitors.
3. High competition: This is a market in which there are many competitors offering similar
products or services. In this situation, product management will focus on identifying and
exploiting product differentiation opportunities to gain a competitive advantage.
4. Intense competition: This is a market in which there are a small number of dominant players
with significant market power. In this situation, product management will focus on identifying
and exploiting niche markets and product differentiation opportunities, as well as building strong
customer relationships to overcome barriers to entry.

In product management, understanding the level of competition in the market is essential for
developing an effective product strategy that meets the needs of customers and achieves
business goals.

Q. Methods for Determining Competitors?

Ans. Methods for Determining Competitors in product management

In product management, it's important to identify and understand the competitors in the market
to develop a successful product strategy. Here are some methods for determining competitors:

1. Market research: Conducting market research can help identify competitors in a specific market.
This can include analyzing industry reports, online reviews, and customer surveys to understand
which products and brands are competing for the same customer segments.
2. Social media monitoring: Monitoring social media channels can provide insights into
competitors' product offerings, customer sentiment, and marketing strategies. This can be done
using social listening tools to track mentions of competitors and their products.
3. Competitive analysis: Conducting a competitive analysis involves researching and analyzing
competitors' products, pricing, marketing strategies, and market share. This can be done using
publicly available information or by purchasing competitors' products to conduct hands-on
analysis.
4. Customer interviews: Talking to customers can help identify which products they are using or
considering, and what they like or dislike about those products. This can help identify direct and
indirect competitors that may not be obvious through other methods.
5. Industry events and conferences: Attending industry events and conferences can provide
opportunities to network with competitors, learn about their products and strategies, and gain
insights into market trends and customer needs.

Overall, it's important to use a combination of these methods to get a comprehensive

understanding of competitors in a market. This can help inform product positioning,
differentiation, and pricing strategies to gain a competitive advantage.

Q. Methods for Determining Competitors in product management?

In product management, it's important to identify and understand the competitors in the market
to develop a successful product strategy. Here are some methods for determining competitors:
1. Market research: Conducting market research can help identify competitors in a specific market.
This can include analyzing industry reports, online reviews, and customer surveys to understand
which products and brands are competing for the same customer segments.
2. Social media monitoring: Monitoring social media channels can provide insights into
competitors' product offerings, customer sentiment, and marketing strategies. This can be done
using social listening tools to track mentions of competitors and their products.
3. Competitive analysis: Conducting a competitive analysis involves researching and analyzing
competitors' products, pricing, marketing strategies, and market share. This can be done using
publicly available information or by purchasing competitors' products to conduct hands-on
analysis.
4. Customer interviews: Talking to customers can help identify which products they are using or
considering, and what they like or dislike about those products. This can help identify direct and
indirect competitors that may not be obvious through other methods.
5. Industry events and conferences: Attending industry events and conferences can provide
opportunities to network with competitors, learn about their products and strategies, and gain
insights into market trends and customer needs.

Overall, it's important to use a combination of these methods to get a comprehensive

understanding of competitors in a market. This can help inform product positioning,
differentiation, and pricing strategies to gain a competitive advantage.

Q. Aggregate Market Factors?

Ans. Aggregate market factors refer to the macroeconomic conditions that affect the
overall performance of a market or industry. These factors can impact the demand
for products, production costs, and overall profitability. Here are some common
aggregate market factors:

1. Economic growth: Economic growth refers to the increase in the production of

goods and services in an economy over time. In general, higher economic growth
leads to increased demand for products and services, which can boost the
performance of a market or industry.
2. Interest rates: Interest rates refer to the cost of borrowing money. When interest
rates are low, it can stimulate demand for products and services, as borrowing
becomes more affordable. However, high interest rates can increase production costs
and reduce demand.
3. Inflation: Inflation refers to the increase in the overall price level of goods and
services in an economy. High inflation can reduce consumer purchasing power and
increase production costs, which can negatively impact the performance of a market
or industry.
4. Government policies: Government policies such as tax laws, trade policies, and
regulations can have a significant impact on the performance of a market or industry.
For example, policies that increase taxes or impose trade restrictions can reduce
demand for products and services, while policies that provide incentives for
investment can stimulate growth.
5. Demographics: Demographic factors such as population size, age, income, and
education level can influence the demand for products and services. For example, a
growing population or an aging population may have different needs and
preferences that can impact the performance of a market or industry.

Overall, it's important for businesses to monitor and understand aggregate market
factors to identify potential risks and opportunities in the market. This can inform
strategic decisions around product development, pricing, and marketing, and help
businesses stay competitive in changing market conditions.

Q. Michael Porter’s Five force Model?

Michael Porter's Five Forces Model is a framework for analyzing the competitive environment of
an industry. It identifies the five forces that determine the intensity of competition and
profitability of a market, and helps businesses develop strategies to compete effectively.

The five forces are:

1. Threat of new entrants: This refers to the likelihood of new competitors entering the market.
High barriers to entry, such as high capital requirements, government regulations, or brand
recognition, can deter new competitors and limit the threat of new entrants.
2. Bargaining power of suppliers: This refers to the degree of power that suppliers have over the
industry. Suppliers with significant bargaining power can raise prices or reduce the quality of
inputs, which can impact the profitability of businesses in the industry.
3. Bargaining power of buyers: This refers to the degree of power that buyers have over the
industry. Buyers with significant bargaining power can negotiate lower prices or demand higher
quality products, which can impact the profitability of businesses in the industry.
4. Threat of substitute products or services: This refers to the extent to which alternative
products or services can fulfill the same customer needs. The availability of substitutes can limit
the pricing power of businesses in the industry and reduce profitability.
5. Rivalry among existing competitors: This refers to the intensity of competition between
existing businesses in the industry. High levels of rivalry can lead to price wars, aggressive
marketing, and innovation, which can impact the profitability of businesses in the industry.

Overall, the Five Forces Model helps businesses identify the key drivers of competition in their
industry and develop strategies to address them. It can also help businesses evaluate the
attractiveness of entering or exiting a market.
Q. (c) Category Factors:

Category factors refer to the specific characteristics of the products or services in a

market that influence the competition within that market. In Michael Porter's Five
Forces Model, category factors are a subcategory of industry structure, and they
include product differentiation, branding, and customer loyalty.

Product differentiation refers to the degree to which a product or service is unique or

distinct from competitors. A highly differentiated product can command a higher
price and be more resistant to competition. Branding is the process of creating a
unique and recognizable brand image, which can increase customer loyalty and
make it more difficult for new competitors to enter the market. Customer loyalty
refers to the extent to which customers are committed to a particular brand or
product, which can create a barrier to entry for new competitors.

(d) Environmental Analysis:

Environmental analysis is the process of analyzing the external factors that affect the
performance of a business, including economic, political, social, and technological
factors. In Michael Porter's Five Forces Model, environmental analysis is a separate
category that includes factors outside the control of the industry, such as
government policies, economic conditions, and cultural trends.

Environmental analysis is important for businesses because it can identify

opportunities and threats in the market that can impact their performance. For
example, changes in government policies or economic conditions can create new
opportunities or reduce demand for certain products or services. Social and cultural
trends can also impact consumer preferences and create new opportunities for
businesses that are able to adapt. Environmental analysis is often conducted using
tools such as PEST analysis, which stands for Political, Economic, Social, and
Technological analysis, to identify relevant factors in the business environment.

UNIT- 2

Q. Customer Analysis?

(a) Who buys and uses the Products:

Customer analysis begins with understanding who buys and uses the products. This
includes identifying the demographics of the target market such as age, gender,
income, education, and occupation. Additionally, businesses need to understand the
psychographics of their target market, such as their interests, values, attitudes, and
behaviors. This information can help businesses develop effective marketing and
sales strategies that target specific customer segments.

(b) What Customers Buy and How they Use It:

Understanding what customers buy and how they use the product is crucial for
businesses to identify areas of improvement and opportunities for new product
development. This includes identifying the specific features and benefits that
customers value, and how they integrate the product into their daily lives. This
information can be gathered through customer surveys, interviews, and observation.

(c) Why they prefer a product:

Understanding why customers prefer a product is essential for businesses to develop

effective marketing messages that resonate with their target market. This includes
identifying the specific features and benefits that customers value, as well as any
emotional or psychological factors that influence their decision-making. For example,
customers may prefer a product because it aligns with their values, or because it
makes them feel a certain way.

(d) Source of Customer Value and Assessing the Value of Product Category:

Businesses need to identify the sources of customer value to develop products that
meet their needs and preferences. The sources of customer value can include
functional benefits, emotional benefits, and social benefits. Functional benefits refer
to the specific features and capabilities of the product, while emotional benefits refer
to the feelings and experiences associated with using the product. Social benefits
refer to the social status or image that the product conveys.

Assessing the value of a product category involves identifying the benefits that
customers value most, as well as the key factors that influence their purchase
decisions. This can include factors such as price, quality, brand reputation, and
convenience. Businesses can use this information to identify areas of improvement
and develop strategies that differentiate their products from competitors.
Additionally, businesses can use customer feedback to improve their products and
services and increase customer satisfaction.

Q. Market Potential and Sales Forecasting?

(a) Overview:

Market potential and sales forecasting are essential components of product

management. Market potential refers to the total sales that can be achieved in a
given market, while sales forecasting involves predicting the expected sales volume
for a specific product or service.

(b) What they are used for:

Market potential and sales forecasting are used for a variety of purposes, including
developing marketing strategies, determining pricing strategies, allocating resources,
and evaluating the feasibility of new product development. These tools help
businesses identify the potential demand for their products, assess market
conditions, and make informed decisions about resource allocation and product
development.

(c) Methods of estimating Market and sales potential:

 There are several methods for estimating market and sales potential, including:

1. Market research: This involves conducting surveys and analyzing market data to
identify customer needs, preferences, and purchasing behaviors. This information can
be used to estimate market potential and develop sales forecasts.
2. Historical data analysis: This involves analyzing sales data from previous years to
identify trends and patterns in customer demand. This information can be used to
estimate future sales volume and identify areas for growth.
3. Industry analysis: This involves analyzing trends and patterns in the broader industry
to identify market opportunities and estimate market potential.
4. Expert opinions: This involves consulting with industry experts to gain insights into
market conditions and potential demand.

(d) Sales Forecast:

Sales forecasting involves predicting the expected sales volume for a specific product
or service. This can be done using several methods, including historical data analysis,
market research, and expert opinions. Sales forecasts are essential for businesses to
make informed decisions about resource allocation, pricing strategies, and
production planning. Accurate sales forecasting can help businesses avoid stockouts
or excess inventory, reduce costs, and maximize profitability.

Q. Developing Product Strategy?

a) Elements of Product Strategy:

Product strategy involves making decisions about how to create and market a
product to meet the needs of customers and achieve business objectives. The
elements of a product strategy typically include:

1. Target market: Identifying the specific customer segments that the product is
intended to serve.
2. Product positioning: Determining how the product will be positioned in the market
relative to competitors and how it will be differentiated from other products.
3. Product features: Deciding what features and attributes the product will have in order
to meet the needs of the target market.
4. Pricing: Setting the price of the product based on factors such as production costs,
competitive pricing, and customer willingness to pay.
5. Distribution: Determining how the product will be distributed to customers, including
the channels that will be used and the logistics of getting the product to market.
6. Promotion: Deciding on the marketing communications that will be used to promote
the product, including advertising, sales promotions, and public relations.
 b) Selection of Strategic Alternative: When developing a product strategy, it's
important to consider different strategic alternatives and select the one that best
meets the needs of the business and its customers. Some common strategic
alternatives include:

1. Market penetration: Increasing market share by selling more of the existing product
to existing customers.
2. Product development: Developing new products to sell to existing customers.
3. Market development: Selling existing products to new markets or customer
segments.
4. Diversification: Developing new products to sell to new markets or customer
segments.

When selecting a strategic alternative, it's important to consider factors such as the
competitive environment, market trends, and the resources and capabilities of the
business.

c) Product Strategy over the Life Cycle:

The product life cycle describes the stages that a product goes through from
introduction to decline. The product strategy that a business uses will need to evolve
over the course of the product life cycle. Some key considerations for product
strategy at each stage of the product life cycle include:

1. Introduction: The focus is on building awareness and generating demand for the
product. Pricing may be high initially to recoup development costs, and distribution
may be limited to specific channels.
2. Growth: The focus is on increasing market share and expanding distribution. Pricing
may be adjusted to be more competitive, and new features may be added to the
product to appeal to a broader range of customers.
3. Maturity: The focus is on maintaining market share and maximizing profits. Pricing
may be adjusted again to reflect increased competition, and marketing efforts may
focus on reinforcing the product's brand and differentiating it from competitors.
4. Decline: The focus is on managing the decline of the product and potentially
replacing it with a new product. Pricing may be reduced to clear out remaining
inventory, and marketing efforts may focus on selling the product to the remaining
loyal customers while transitioning them to the new product.
 UNIT - 3

Q. Product Portfolio Analysis?

a) Product Portfolio Models: Product portfolio analysis is a process of evaluating

the company's products and services in order to determine which ones should be
invested in, maintained, or divested. Two popular models for product portfolio
analysis are the BCG Growth-Share Matrix and the GE Matrix.

1. BCG Growth-Share Matrix: The BCG Growth-Share Matrix is a tool for analyzing a
company's product portfolio based on two factors: market growth rate and relative
market share. The matrix consists of four quadrants:
 Stars: High market share and high market growth rate. These products have high
potential for growth and profit and should be invested in.
 Cash cows: High market share but low market growth rate. These products generate
a lot of revenue but have limited potential for growth. They should be maintained
and milked for profits.
 Question marks: Low market share but high market growth rate. These products
have potential for growth but also require investment to capture the market. They
should be carefully evaluated to determine whether they can become stars or should
be divested.
 Dogs: Low market share and low market growth rate. These products have little
potential for growth and may not be worth investing in. They should be divested
unless they are important for strategic reason
 Q. GE Matrix:
The GE Matrix is a tool for analyzing a company's product portfolio based on two
factors: industry attractiveness and business unit strength. The matrix consists of nine
cells:
 High industry attractiveness, high business unit strength: Invest and grow.
 Medium industry attractiveness, high business unit strength: Selective investment
and growth.
 Low industry attractiveness, high business unit strength: Harvest and divest.
 High industry attractiveness, medium business unit strength: Invest and grow or
selectively invest and grow.
 Medium industry attractiveness, medium business unit strength: Selective investment
and growth.
 Low industry attractiveness, medium business unit strength: Harvest or divest.
 High industry attractiveness, low business unit strength: Invest and grow or
selectively invest and grow.
 Medium industry attractiveness, low business unit strength: Selective investment and
growth or harvest.
 Low industry attractiveness, low business unit strength: Divest.

The GE Matrix considers both external and internal factors, making it more
comprehensive than the BCG Growth-Share Matrix.

b) Product Portfolio Analysis:

 Product portfolio analysis is an important tool for businesses to make strategic
decisions about their product offerings. By analyzing the market and the company's
own strengths and weaknesses, businesses can determine which products to invest
in, maintain, or divest. The analysis can help companies to:

1. Identify areas of growth potential: By identifying products with high market

growth rates and high relative market shares, companies can focus their investments
on products with the potential for significant growth.
2. Allocate resources effectively: By understanding which products are generating the
most revenue and profits, companies can allocate resources more effectively to
ensure that they are investing in the most profitable products.
3. Identify product gaps: By evaluating the market and the company's product
portfolio, companies can identify gaps in their offerings and determine whether to
develop new products or acquire other companies to fill those gaps.
4. Optimize product mix: By evaluating the strengths and weaknesses of different
products, companies can optimize their product mix to ensure that they are offering
the most attractive products to customers while maximizing profits.

Q.

(a) The Importance of Innovations: (Consumer Adoption and Diffusion Process)

Innovation is crucial for the success of a business, as it allows companies to stay

competitive and meet the changing needs of customers. Innovations can take various
forms, including new products, services, or processes. However, the success of an
innovation is determined by how quickly it is adopted by customers.

The consumer adoption process refers to the stages that consumers go through in
deciding whether to adopt or reject a new product or service. The process typically
includes awareness, interest, evaluation, trial, and adoption. The diffusion process, on
the other hand, refers to the spread of the new product or service across the market.

Several factors can influence the rate of adoption and diffusion of an innovation,
including the perceived relative advantage of the innovation over existing products,
compatibility with consumers' needs, complexity, trialability, and observability.
 Marketers need to consider these factors when developing and promoting new
products to ensure a high level of adoption and diffusion.

(b) Consideration in adding or dropping a variant:

Adding or dropping a product variant can be a significant decision for a business. It

is essential to consider various factors before making such a decision. Some of the
factors to consider include:

1. Market demand: Before adding or dropping a variant, businesses should evaluate

the current market demand for the product. This can be done by conducting market
research, analyzing sales data, and monitoring industry trends.
2. Production cost: Adding or dropping a variant can impact production costs. It is
essential to evaluate the cost implications of adding or dropping a variant, including
the cost of raw materials, manufacturing, and packaging.
3. Inventory management: Adding or dropping a variant can impact inventory
management. If a new variant is added, the business needs to ensure that there is
enough inventory to meet demand. If a variant is dropped, the business needs to
manage its inventory of the remaining variants effectively.
4. Marketing and branding: Adding or dropping a variant can impact the marketing
and branding of the product. It is essential to consider how the change will affect the
product's brand identity and how it will be marketed to consumers.
5. Competition: Adding or dropping a variant can impact the product's competitive
position in the market. It is essential to evaluate the competition and how the change
will affect the product's ability to compete.

Overall, adding or dropping a variant requires careful consideration of several factors.

By carefully evaluating these factors, businesses can make informed decisions that
will help them achieve their goals and maintain a competitive advantage in the
market.

Q. Stages in NPD?

The process of new product development (NPD) typically involves several stages,
which may vary depending on the nature of the product and the company's goals.
However, a typical NPD process consists of the following stages:

1. Idea Generation: This is the first stage of the NPD process, where the company
generates new product ideas through various sources, such as brainstorming
sessions, market research, and customer feedback.
2. Development and Testing: Once the ideas are generated, they are further
developed and tested to determine their technical feasibility and commercial
 viability. Projective techniques, such as focus groups and surveys, may be used to
gather consumer feedback on the proposed ideas.
3. Concept Testing and Development: In this stage, the company develops a product
concept and tests it with target consumers to gauge their reaction. Multi-attribute
analysis and conjoint analysis are commonly used tools to measure consumer
preferences and identify the most appealing concept.
4. Feasibility Screening: After concept testing, the company conducts a feasibility
screening to assess the product's technical feasibility, market potential, and financial
viability. This involves analyzing the product's cost structure, competitive
environment, and regulatory requirements.
5. Prototype Development: Once the product's feasibility is established, the company
develops a prototype of the product to test its functionality and performance. This
stage may involve several iterations to refine the prototype.
6. Test Marketing: After the prototype is developed, the company conducts a test
market to determine how the product performs in a real market environment. This
allows the company to identify any issues and make any necessary adjustments
before a full-scale launch.
7. Product Launch / Commercialization: If the test marketing is successful, the
company proceeds with a full-scale launch of the product, including advertising,
promotion, and distribution.
8. Post Launch Test: After the product is launched, the company conducts post-launch
testing to measure its success and identify any areas for improvement. This may
include gathering customer feedback, analyzing sales data, and monitoring market
trends.

Overall, the NPD process is a complex and iterative process that requires careful
planning and execution at each stage to ensure the product's success in the market.

Q. Pricing Decisions:-
(a) Measuring Perceived Value and Price, (b) Calculating Value in Use (c) Psychological
Aspect of Price (d) Competition and Pricing (e) Pricing Objective (f) Factors affecting Price (g)
Pricing Tactics?

Ans. (a) Measuring Perceived Value and Price:

Measuring perceived value and price involves assessing the value that a product or
service provides to customers and how much they are willing to pay for it. Perceived
value is determined by the benefits that customers receive from the product or
service, as well as their expectations and perceptions of the product's quality and
value.

(b) Calculating Value in Use:

Calculating value in use involves assessing the value that a product or service
provides to customers in terms of its usefulness and functionality. This involves
analyzing the benefits that customers receive from the product or service and how
much they are willing to pay for it.

(c) Psychological Aspect of Price:

The psychological aspect of price refers to the impact that pricing has on customer
perceptions and behavior. This includes the effect of pricing on customer
expectations, willingness to pay, and perceived value. Factors such as pricing
strategy, price anchoring, and price framing can all impact the psychological aspect
of price.

(d) Competition and Pricing:

Competition plays a critical role in pricing decisions, as companies need to consider

their competitors' prices and positioning in the market. Pricing decisions should be
made based on a thorough analysis of the competitive landscape and the company's
market position.

(e) Pricing Objectives:

Pricing objectives refer to the goals that a company seeks to achieve through its
pricing strategy. These objectives can include maximizing profits, increasing market
share, or maintaining price leadership in the market.

(f) Factors affecting Price:

Several factors can influence pricing decisions, including production costs,

competition, customer demand, market conditions, and regulatory requirements.
Companies need to consider these factors carefully when setting prices for their
products or services.

(g) Pricing Tactics:

Pricing tactics refer to the specific strategies and techniques that companies use to
set prices for their products or services. These tactics can include promotional
pricing, discounts, bundling, psychological pricing, and dynamic pricing. Companies
need to carefully evaluate these tactics to determine which ones are best suited for
their products and target market.

HITESH TANDON

BITM