Unit I

Noida Institute of Engineering and Technology, Greater Noida
Introduction to Product Management

Unit-1
Product and Brand Management

Ms.Priyanka Malhotra
(AMBA-MK0312)
Asst Prof.
MBA-3rd Sem Dept of MBA
Ms.Priyanka Malhotra AMBAMK0312 Unit-1

1
04/06/2024
Unit Content
UNIT 1: CO1
1. Product Management & Scope, Definition of Product,
Classification of Product Classification of Product
2. Product Levels, Product Hierarchy.
3. Product Life Cycle and strategies, Product Evaluation
4. Product Portfolio/Mix
5. BCG Matrix & Shell Directional Policy Matrix
04/06/2024 Ms.Priyanka Malhotra 2

AMBAMK0312 Unit-1
Unit Objective
• Learn concepts of product, product management and

product matrix.

AMBAMK0312 Unit-1
Topic Objective /Topic Outcome
Unit 1: Introduction to Product & Related

Concepts
Topic 1:
 Product Management & Scope
 Definition of Product
 Classification of Products
04/06/2024 Ms.Priyanka Malhotra AMBAMK0312 Unit-1 4

Product Management
Product management is an organisational function within a company

dealing with new product development, business justification, planning,
verification, forecasting, pricing, product launch, and marketing of a
product or products at all stages of the product life cycle.

AMBAMK0312 Unit-1
Product Management
Scope:
• It helps in analyzing market conditions and defining features and
function of a product and for overseeing the production of the
product.
• Product Management encompasses everything associated with a
product’s successful launch in a market since it involves the
supervision and management of the entire lifecycle of a product from
developing marketing campaigns, product delivery, and inception of
the product idea.

AMBAMK0312 Unit-1
Concept of Product
A product is anything that is potentially valued by a target market or the

benefits or satisfactions it provides, including objects, services,
organisation, places, people and ideas.
American Marketing Association defines product as “Anything that can be

offered to a market for attention, acquisition or consumption including
physical objects, services, personalities, organisations and desires”.

AMBAMK0312 Unit-1
Concept of Product
Product Characteristics:
A. Explicit Characteristics:
B. Physical configuration
1. Associated services
2. Package and brand name
3. Product mix
4. Product-life-cycle

AMBAMK0312 Unit-1
Concept of Product
Product Characteristics:
B. Implicit Characteristics:
1. Product symbolism
2. Communication media
3. Product perception
4. Product evaluation

AMBAMK0312 Unit-1
Concept of Product

AMBAMK0312 Unit-1
Concept of Product

AMBAMK0312 Unit-1
Concept of Product

AMBAMK0312 Unit-1
Classification of Products
Products may be classified on the basis of users of the products

1. Consumer products
i. Convenience products : Eg. soap, toothpaste, detergents, food items.
ii. Shopping products: Eg. television, air conditioners, cars, furniture,
hotel and airline services, tourism services etc.
iii. Speciality products: Sports cars, designer clothing, exotic perfumes,
luxury watches, and famous paintings
iv. Unsought products: funeral services, encyclopedias, fire extinguishers
and reference books.

AMBAMK0312 Unit-1
2. Industrial products
i. Material and parts: raw material, manufactured materials include iron,
yarn, cement, wires and component parts include small motors, tires, and
castings.
ii. Capital items: installations and accessory equipments
iii. Supplies: lubricants, coal, paper, pencils and repair maintenance like
paint, nails brooms.
iv. Services: computer repair services, legal services, consultancy services,
and advertising services.

AMBAMK0312 Unit-1
Classification of Products – On the Basis of Durability, Tangibility and Use

(a) Non-durable goods- For example, soaps, salt and biscuits.
(b) Durable goods- For example, colour TV, refrigerators, washing
machines and vacuum cleaners.
(c) Services- Services rate intangible, inseparable, variable and perishable
products. For example, airline and banking services.

AMBAMK0312 Unit-1
Daily Quiz
• Define product management.

• Define product.
• Television is an example of ……………….. goods.
• ………………….. are the goods the consumer either does not
know about or knows about but does not normally think of
buying.

AMBAMK0312 Unit-1
Introduction to Product & Related Concepts
Topic 2:
 Product Levels
 Product Hierarchy

Product Levels
Theodore Levitt proposes that in planning its market offering, the

marketer needs to think through 5 levels of the product. Each level adds
more customer value and taken together forms Customer Value
Hierarchy.

AMBAMK0312 Unit-1
Product Levels
i. Core Benefit or Product For eg. a hotel customer is actually buying the
concept of “rest and sleep”
ii. Basic or Generic Product: The basic product for hotel may include bed,
toilet, and towels.
iii. Expected Product: For eg, hotel customers expect clean bed, fresh towel
and a degree of quietness.
iv. Augmented product. For eg, the hotel can include fresh flowers, room
service and prompt check-in and checkout.
v. Potential Product: satisfaction + delight

AMBAMK0312 Unit-1
Product hierarchy
A product hierarchy is a method of classifying your company’s products

and services by their essential components into a logical structure.
Product need For example, motor vehicles exist because people have to
and want to travel. This is the core product need, for example, Toyota
vehicles.
Product family – In this particular case, the product family is travel and for
Toyota, the product family is vehicles.
Product class – Other for eg. shower gels, body washes and soaps.

AMBAMK0312 Unit-1
Product hierarchy
Product line – For example Pepsico (PEP) owns, among many other lines
globally, Frito Lay, Gatorade, Quaker Oats, and Tropicana.
Product type –For example, under Hyundai I20 product line, we have
product types such as I20Astana, I20 sportz and I20 Magna.
Product unit – For example, the Hyundai I20 Asta is one Product unit and
so is the Hyundai I20 Magna.

AMBAMK0312 Unit-1
Product hierarchy

AMBAMK0312 Unit-1
Daily Quiz
• ………………………. includes a set of attributes and conditions,

which buyers normally expect they purchase this product.
• In ……………………, the core need satisfied by a product is the
focus.
• Define product hierarchy.
• Give an example of product line.

AMBAMK0312 Unit-1
Unit 1: Introduction to Product & Related

Concepts
Topic 3:
 Different stages of PLC
 Product Life Cycle strategies
 Product Evaluation

Product Life Cycle

AMBAMK0312 Unit-1
Product Life Cycle
Introduction Stage
• Product is launched in the market
• Its sales will begin to grow slowly
• Profit, if any, will be rather small
• High costs
• High promotion costs
• Priority of the firm is to generate widespread awareness of the
product in its target segment and to stimulate trial.
Pricing strategies :
Price skimming
Price penetration

AMBAMK0312 Unit-1
Product Life Cycle
Product introduction strategies
Marketing strategies used in the introduction stages include:

• Rapid skimming - launching the product at a high price and high
promotional level
• Slow skimming - launching the product at a high price and low
promotional level
• Rapid penetration - launching the product at a low price with
significant promotion
• Slow penetration - launching the product at a low price and minimal
promotion

AMBAMK0312 Unit-1
Product Life Cycle
During the introduction stage, you should aim to:
• Establish a clear brand identity

• Connect with the right partners to promote your product
• Set up consumer tests, or provide samples or trials to key target
markets
• Price the product or service as high as you believe you can sell it, and
to reflect the quality level you are providing

AMBAMK0312 Unit-1
Product Life Cycle
Growth Stage
• If the product meets existing market needs or stimulates previously
untapped needs, it will enter the growth stage.
• Sales will usually lift off. This point is called the take-off point.
• Profits are generated as sales revenues increase faster than costs.
• Higher competition which potentially responds with a similar or
improved version of the offering.
• Can increase their sales by attracting new customers rather than
undercutting each other on price.

AMBAMK0312 Unit-1
Product Life Cycle
• The total size of the market tends to grow

• An increase in the number of distribution outlets tends to go in hand
with this.
Product growth strategies

• improving product quality
• adding new product features or support services to grow your market
share
• entering new markets segments
• keeping pricing as high as is reasonable to keep demand and profits
high
AMBAMK0312 Unit-1
Product Life Cycle
• increasing distribution channels to cope with growing demand

• shifting marketing messages from product awareness to product
preference
• skimming product prices if your profits are too low

AMBAMK0312 Unit-1
Product Life Cycle
Maturity Stage
• The sales growth of the product slows down

• There is a tendency for companies to capture customers from their
competitors by undercutting each other on prices and increasing
promotional efforts.
• Competitive rivalry intensifies, the weaker competitors are forced out of
the market. This point is known as the shake-out point.
• Heavy price competition

AMBAMK0312 Unit-1
Product Life Cycle
• The firm will try to prevent the sales to decline, while maintaining
profitability.
• Increased marketing expenditure from all competitors in order to retain
brand loyalty.
Product maturity strategies

• Market modification - this includes entering new market segments,
redefining target markets, winning over competitor's customers,
converting non-users
• Product modification - for example, adjusting or improving your
product's features, quality, pricing and differentiating it from other
products in the marking
AMBAMK0312 Unit-1
Product Life Cycle
Product decline stage

• Declining sales and profits
• Less or no promotional expenses
• Changes in consumer preferences, technological advances and
alternatives on the market.
Product decline strategies
• Reduce your promotional expenditure on the products
• Reduce the number of distribution outlets that sell them
• Implement price cuts to get the customers to buy the product

AMBAMK0312 Unit-1
Product Life Cycle
Product decline strategies

• Find another use for the product
• Maintain the product and wait for competitors to withdraw from the
market first
• Harvest the product or service before discontinuing it sell the brand
to another business
• significantly reduce the price to get rid of all the inventory

AMBAMK0312 Unit-1
Product Evaluation

AMBAMK0312 Unit-1
Daily Quiz
• Name the four stages of the product life cycle.

• Name the two new product pricing strategies.
• Give the two marketing strategies used by the marketer in the
maturity stage.
• What does divest mean and when does it take place?
• Define shake out period.

AMBAMK0312 Unit-1
Unit 1: Product Portfolio
Topic 4:
 Concept
 Factors influencing Product Portfolio

Product Evaluation
Product evaluation is the process of assessing a manufactured

product’s suitability and safety for use by consumers.
Product evaluation is conducted for two main reasons:

1) To ensure product follows relevant standards, and
2) To identify and remove manufacturing or design defects.
• Guarantee product success by ensuring the safety and quality.
• Failure to secure products from both manufacturing and design
defects can result in product recalls and lawsuits under product
liability.

AMBAMK0312 Unit-1
Product Portfolio
A product portfolio is the collection of all the products or services offered

by a company. It is the range of items sold by a business.
Eg. Sony has a product portfolio that includes computers, cameras,
televisions and games.

AMBAMK0312 Unit-1
Product Portfolio
Costs of maintaining a large product portfolio

 increased research and development costs due to multiple products
being produced
 marketing and advertising costs may be high due to the promotion of a
large range of products
 bad publicity incurred by one product may affect sales of all products
within the portfolio
 resources may be spread too thin and this could affect the performance
of existing cash cow products

AMBAMK0312 Unit-1
Product Portfolio
Benefits of maintaining a large product portfolio

 having different products can spread risk between markets. This
mean there is less chance of a company making losses
 having a range of products can lead to greater brand awareness.
 can encourage customer loyalty as customers are more likely to buy
multiple products from the same brand.
 easier to launch new products due to greater brand awareness
 can meet the needs to different market segments

AMBAMK0312 Unit-1
Product Portfolio
 can allow for seasonal fluctuations

 allows for new products to replace products at the end of the product
life cycle
 can increase profits from selling a range of different products

AMBAMK0312 Unit-1
Factors affecting product portfolio
1. Profitability
2. Objectives and Policy of Company
3. Production Capacity
4. Demand
5. Production Costs
6. Government Rules and Restriction
7. Demand Fluctuation
8. Competition
9. Impact of Other Elements of Marketing Mix
10. Overall Business Condition or Condition of Economy
22
04/06/2024 Ms.Priyanka Malhotra
AMBAMK0312 Unit-1
44
Daily Quiz
• Give two ways of evaluating a product.

• Define product portfolio.
• How does production capacity and organisational policy affect
product portfolio?
• Give an example of product portfolio.

AMBAMK0312 Unit-1
Unit 1: Product Portfolio
Topic 5:
 The BCG Growth Matrix
 Shell’s Directional Policy Matrix

BCG Matrix
The Boston Consulting Group growth share matrix was built on the logic
that market leadership results in sustainable superior returns.
The matrix reveals two factors that companies should consider when
deciding where to invest—company competitiveness, and market
attractiveness—with relative market share and growth rate as the
underlying drivers of these factors.

AMBAMK0312 Unit-1
BCG Matrix
Each of the four quadrants represents a specific combination of relative

market share, and growth:
Low Growth, High Share. Companies should milk these “cash cows” for
cash to reinvest.
High Growth, High Share. Companies should significantly invest in these
“stars” as they have high future potential.
High Growth, Low Share. Companies should invest in or discard these
“question marks,” depending on their chances of becoming stars.
Low Share, Low Growth. Companies should liquidate, divest, or
reposition these “pets.”

AMBAMK0312 Unit-1
BCG Matrix

AMBAMK0312 Unit-1
Shell Directional Policy Matrix
The Shell Directional Policy Matrix (DPM) is another refinement upon

the Boston Consulting Group (BCG) Matrix.
• Horizontal Axis: Business sector profitability includes the size of the
market, expected growth, lack of competition, profit margins within
the market and other favourable political and socio-economic
conditions.
• Vertical Axis: Company’s competitive capability is determined by the
sales volume, the products reputation, reliability of service and
competitive pricing.

AMBAMK0312 Unit-1

AMBAMK0312 Unit-1
Phases
1. Divest
2. Phased withdrawal
3. Double or quit
4. Custodial
5. Try harder
6. Cash Generator
7. Growth
8. Market Leadership

AMBAMK0312 Unit-1
Daily Quiz
• Differentiate between BCG Matrix and Shell’s Directional

Policy Matrix.
• Name the four quadrants of the BCG matrix.
• Can question marks become cows?
• Enumerate the basis of studying the Shell’s Directional Policy
Matrix.

AMBAMK0312 Unit-1
THANK YOU

AMBAMK0312 Unit-1

Unit I

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Unit I

Uploaded by

Copyright:

Available Formats

Noida Institute of Engineering and Technology, Greater Noida

Introduction to Product Management

Product and Brand Management

Ms.Priyanka Malhotra AMBAMK0312 Unit-1

04/06/2024 Ms.Priyanka Malhotra 2

• Learn concepts of product, product management and

04/06/2024 Ms.Priyanka Malhotra 3

Unit 1: Introduction to Product & Related

04/06/2024 Ms.Priyanka Malhotra AMBAMK0312 Unit-1 4

Product management is an organisational function within a company

04/06/2024 Ms.Priyanka Malhotra 5

04/06/2024 Ms.Priyanka Malhotra 6

A product is anything that is potentially valued by a target market or the

American Marketing Association defines product as “Anything that can be

04/06/2024 Ms.Priyanka Malhotra 7

04/06/2024 Ms.Priyanka Malhotra 8

04/06/2024 Ms.Priyanka Malhotra 9

04/06/2024 Ms.Priyanka Malhotra 10

04/06/2024 Ms.Priyanka Malhotra 11

04/06/2024 Ms.Priyanka Malhotra 12

Products may be classified on the basis of users of the products

04/06/2024 Ms.Priyanka Malhotra 13

04/06/2024 Ms.Priyanka Malhotra 14

Classification of Products – On the Basis of Durability, Tangibility and Use

04/06/2024 Ms.Priyanka Malhotra 15

• Define product management.

04/06/2024 Ms.Priyanka Malhotra 16

Introduction to Product & Related Concepts

04/06/2024 Ms.Priyanka Malhotra AMBAMK0312 Unit-1 17

Theodore Levitt proposes that in planning its market offering, the

04/06/2024 Ms.Priyanka Malhotra 18

04/06/2024 Ms.Priyanka Malhotra 19

A product hierarchy is a method of classifying your company’s products

04/06/2024 Ms.Priyanka Malhotra 20

04/06/2024 Ms.Priyanka Malhotra 21

04/06/2024 Ms.Priyanka Malhotra 22

• ………………………. includes a set of attributes and conditions,

04/06/2024 Ms.Priyanka Malhotra 23

Unit 1: Introduction to Product & Related

04/06/2024 Ms.Priyanka Malhotra AMBAMK0312 Unit-1 24

04/06/2024 Ms.Priyanka Malhotra 25

04/06/2024 Ms.Priyanka Malhotra 26

Product introduction strategies

Marketing strategies used in the introduction stages include:

04/06/2024 Ms.Priyanka Malhotra 27

During the introduction stage, you should aim to:

• Establish a clear brand identity

04/06/2024 Ms.Priyanka Malhotra 28

04/06/2024 Ms.Priyanka Malhotra 29

• The total size of the market tends to grow

Product growth strategies

• increasing distribution channels to cope with growing demand

04/06/2024 Ms.Priyanka Malhotra 31

• The sales growth of the product slows down

04/06/2024 Ms.Priyanka Malhotra 32

Product maturity strategies

Product decline stage

04/06/2024 Ms.Priyanka Malhotra 34

Product decline strategies

04/06/2024 Ms.Priyanka Malhotra 35

04/06/2024 Ms.Priyanka Malhotra 36

• Name the four stages of the product life cycle.

04/06/2024 Ms.Priyanka Malhotra 37