THE PRODUCT

Products are almost always combinations of the tangible and intangible. The entire package is sometimes referred to as the augmented product. The mix of tangibles and intangibles in the augmented product varies from one product or service to another.

THE PRODUCT

Product is a key element in the market offering. Marketing mix planning begins with formulating an offering to meet target customers’ needs or wants. The customer will judge the offering by three basic elements : product features and quality, services mix and quality, and price appropriateness.

COMPONENTS OF THE MARKET OFFERING
Value based pricing

Attractiveness of the market offering Product features and quality Services mix and quality

the marketer needs to think through five levels of the product. . and the five constitute a customer value hierarchy.  Each level adds more customer value.PRODUCT LEVELS  In planning its market offering.

FIVE LEVELS OF THE PRODUCT (5) Potential Product (1) Core Product (2) Basic Product (4) Augmented Product 3)Expected Product .

 Expected Product : A set of attributes and conditions buyers normally expect when they purchase this product.FIVE LEVELS OF THE PRODUCT  Core Product / Core Benefit : The fundamental service or benefit that the customer is really buying. . the marketer has to turn the core benefit into a basic product.  Basic Product : At the same level.

.  Today’s competition essentially takes place at the product-augmentation level.FIVE LEVELS OF THE PRODUCT  Augmented Product : The marketer prepares an augmented product that exceeds customer expectations. competition takes place mostly at the expected product level ). ( In less developed countries.

delivery arrangements. .FIVE LEVELS OF THE PRODUCT ( Augmented Product )  According to Levitt : The new competition is not between what companies produce in their factories. and other things that people value. customer advice. but between what they add to their factory output in the form of packaging. warehousing. services. financing. advertising.

 . For gaining competitive advantage one will have to search for still other features and benefits. each augmentation adds cost. The marketer has to ask whether customers will pay enough to cover the extra cost.FIVE LEVELS OF THE PRODUCT Some things should be noted about productaugmentation strategy :  First. augmented benefits soon become expected benefits. Second.

FIVE LEVELS OF THE PRODUCT
( product-augmentation strategy )

Third, as companies raise the price of their augmented product, some competitors can offer a “ Stripped-down ” version at a much lower price. Thus alongside the growth of fine products we see the emergence of lower-cost products for the clients who simply want the basic product.

FIVE LEVELS OF THE PRODUCT

Potential Product : encompasses all the possible augmentations and transformations the product might undergo in the future. Companies search for new ways to satisfy customers and distinguish their offer. ( Successful Companies add benefits to their offering that not only satisfy customers but also surprise and delight them. ) “ The best way to hold customers is to constantly figure out how to give them more for less. ”

PRODUCT DIFFERENTIATION
The challenge before the product marketers is to create relevant and distinctive product differentiation. The product differentiation may be based on :

Physical Differences ( eg.features, performance, conformance, durability, reliability, design, style, packaging ) Availability Differences (eg.available from stores or orderable by phone, mail, fax, internet )

delivery. consulting. maintenance.. events. low price. symbols. repair ) Price Differences ( eg..PRODUCT DIFFERENTIATION  Service Differences ( eg. media )   . medium price. installation. very high price. training. very low price ) Image Differences ( eg. atmosphere..

CHALLENGES FOR PRODUCT INNOVATORS Any successful differentiation will tend to draw imitators.  Maintain the price and lose some market share and profits. The innovator faces three choices :  Lower the price to protect market share and accept lower profits. .  Find a new basis to differentiate the product and maintain current price.

TANGIBILITY AND USE (consumer or industrial ) (1) (2) (3) NON-DURABLE DURABLE SERVICES .PRODUCT CLASSIFICATION ON THE BASIS OF PRODUCT CHARACTERISTICS :DURABILITY.

Because these goods are consumed quickly and purchased frequently. Eatables . Soaps. clothing and footwear. textiles. plastics. fuel. Ex-FMCGs such as cosmetics and cleaning products. paper and paper products. packaging and containers. Medicine. office supplies.(1)  NON-DURABLES or SOFT GOOD These are tangible goods normally consumed in one or few uses. personal products. the appropriate strategy is to make them available at many locations. food. charge only a small mark up and advertise heavily to induce trial and build preference. Toothpaste. rubber.

(2) DURABLES OR HARD GOOD

These are tangible goods that normally survive many uses. Normally require more personal selling and service, command a higher margin, and require more seller guarantees.
Ex: Cars, appliances, business equipment, electronic equipment, home furnishings and fixtures, houseware and accessories, photographic equipment, recreational goods, sporting goods, toys and games

(3) SERVICES
These are intangible,  inseperable,variable and  perishable products. Normally require more quality control superior credibility, and adaptability.

Ex:-Insurance,

PRODUCT CLASSIFICATION
ON THE BASIS OF CUSTOMER SHOPPING HABITS : (1)CONVENIENCE GOODS (2)SHOPPING GOODS (3)SPECIALITY GOODS (4)UNSOUGHT GOODS

.  (B) Impulse Goods: are purchased without any planning or search efforts.  (A) Staples: Consumers purchase on a regular basis.  (C) Emergency Goods: are purchased when a need is urgent. and with a minimum of efforts. immediately.(1) CONVENIENCE GOODS  are goods that the customer usually purchases frequently.

in the process of selection and purchase. price and style. (B) Heterogeneous Shopping Goods: differ in product features and services that may be more important than price. (A) Homogeneous Shopping Goods: are similar in quality but different enough in price to justify shopping comparisons.(2) SHOPPING GOODS  are goods that the customer . characteristically compares on such basis as suitability. quality.   .

(3) SPECIALITY GOODS  are goods with unique characteristics or brand identification for which buyer is willing to make a special purchasing effort. .

(4)  UNSOUGHT GOODS are goods the consumer does not know about or does not normally think of buying. These goods require advertising and personal selling support. .

PRODUCT STRATEGY  Calls  (1)  (2)  (3)  (4) for coordinated decisions on : Product Mix Product Line Individual Product Service Product .

 A total group of products that an organization markets. length.  .  A company’s product mix has a certain width. depth and consistency.PRODUCT MIX A product mix (also called product assortment) is the set of all products lines and items that a particular company offers for sale.

detergents. toothpaste.DIMENSIONS OF PRODUCT MIX  The width of company’s (say HUL’s) product mix refers to how many different product lines the company carries. food products. . such as bathing soap. shampoos.

DIMENSIONS OF PRODUCT MIX  The length of a company’s product mix refers to the total number of items in its product mix. HLL has several product items like Lux. Lifebuoy. in the product line of bathing soaps. Pears. Thus in each of the product line HLL has a number of product items. Liril. .. Eg.

The average depth of HLL product mix can be calculated by averaging the number of variants within the brand groups. Close up has a depth of nine (3x3).DIMENSIONS OF PRODUCT MIX  The depth of a company’s product mix refers to how many variants are offered of each product in the line. . Thus if close up toothpaste comes in three formulations and in three sizes.

. or some other way.DIMENSIONS OF PRODUCT MIX  The Consistency of the product mix refers to how closely related the various product lines are in end-use. production requirements. HLL’s product lines are consistent insofar as they are consumer goods that go through the same distribution channels. distribution channels.

. can pursue more product-line consistency or less. thus widening its product mix. can add new product lines. can lengthen each product line. depending upon whether it wants to acquire a strong reputation in a single field or participate in several fields. The Co.DIMENSIONS OF PRODUCT MIX      These four dimensions of the product mix provide the handles for defining the company’s product strategy. The Co. The Co. can add more product variants to each product and deepen its product mix. The company can expand its business in four ways. The Co.

HLL PRODUCT MIX PRODUCT MIX WIDTH PL-1 Bath Soaps Dove Liril Le Sancy Rexona Lifebuoy Hamam Breeze Jai Moti PL-2 Fabric Wash PL-3 Beverages PL-4.5 etc Surf Rin Wheel Sunlight Ala 501 Bru Brooke Bond red label Lipton Green label T Taaza Taj Mahal Super Dust Ruby Dust A1 .

 The product mix may be composed of several product lines. because they perform a similar function.PRODUCT LINE A product line is a group of products that are closely related. are sold to the same customer groups.  . are marketed through the same channels or fall within the given price ranges.

. harvest. They also need to understand each product’s market profile.PRODUCT LINE ANALYSIS  Product line managers need to know the sales and profits of each item in their line in order to determine which items to build. how their product line is positioned against competitors’ product lines (The Product Map). or divest..e. maintain. i.

which is not covered by the existing offers of the firm.Product Line Stretching  Line stretching is a measure firms undertake frequently in product management. It can be in two ways Line Stretching Stretching UP Stretching Down . AIM:  To enter a new price slot and a new market segment .

always take care to see that the stretching down or stretching up decisions do not adversely affect its main product /brand in the line and image it has built up over the years Ex-As Parker has stretched down to lower end market it has lost its premium image .Product Line Stretching      When a company stretches a particular product line upward or downward………………it changes current product positioning into customer mind Its find new positioning planks for the new offers and enters new market segments Satisfaction of new segments of customers through new offers Co.

at that time due to high sales and good services co thought to take a risk and move into higher segment. Has positioned its product at lower end market .Stretching UP     When the Co.decides to make higher priced offer for the top slots known as stretching up In stretching up firm moves up the line from its original posture to and make high priced offers from its stable It addresses the new segment .even existing customers are encouraged to aspire for premium products for their preferred firm/brand Examples: Philips-Earlier phase Philips was into two in one section b/w 1000-1500 & use to cater mass market . They launched there Power Play range & it got successful. .

Stretching Down  When company has initially taken its position at higher price slot .stretches the line downwards by offering the product in the same line for lower end markets    They move their product availability from niche market to mass market To make more profits & try to enter into new market Existing customers also get excited and are the probable purchasers at initial stage to the company .

it .Sunlight were the result of this decision. Airtel super soaker Ariel-When P & G was entering the Indian detergent market . HLL decided to down stretch its detergent line by giving lower priced offers Like Wheel . Ghadi.high tech offers. detergent powder To enter into lower end market they launched the various products into blue & green bars. b) c) Parker-Parker has come down to economic change where the mass market can afford it. concentrated . -It was high premium priced . chose to serve the high end market .Stretching Down  a) Examples: HUL-HUL was playing into market into higher slot of detergents of Surf due to higher price segment and wake of competition of low price brands like Nirma.

Line filling        In Line filling company offers ‗Full Line‘ products . Examples: Videocon Air Conditioners TV segment Washing Machines Microwaves Iron .so that customers do not go to competitors for offers /models in a particular price slots.

because of this company withdraw/reduce its some of the brands .variants and pack sizes .  Reason for Pruning: a) Profitability might be under strain b) Line pruning is opposite of line stretching c) Serving market through some value added products Ex: P&G.Head & Shoulders[35 versions but reduced to 15]  .with too many brands .Line Pruning Companies after some years of growth find that their product lines have become unduly long & complicated .

Main task in Product Management: How many different Product Lines should the Firm accommodate? How can the different lines be grouped for effective management? What composition need to be taken within a product line How to position these product in the market? . it is also know as Product policy Management.Why Product Management      Product management means managing the various Product lines and the overall Product mix of the company.

Why Product Management    What should be the brand policy? Should there be individual brands or Family brands? what should be the approach to brand extensions? How to develop brand equity? How to plan for new products so that in the long run the firm retains a healthy product portfolio? .

Main tasks in Product Management Appraisal of each product line and each product/brand in the line  Decisions on Packaging  Product differentiation and positioning  Managing brands and developing brand equity  New Product Development  Managing the PLC of Products/Brands  Managing product quality  .

Appraisal of each product line and each product/brand in the line Appraisal is required due to changing business environment .Comptetion  Why:  Given product might have lost its market acceptance  It may be facing problem in its functional criteria due to new/improved/substitute products  Lost its profitability  .Customer taste and preferences.

Appraisal of each product line and each product/brand in the line   Other product may be poor and damaging its own sales and members of the product line Product might be entered into its decline stage Results:  Withdrawal of existing products  Changing the quality control of products  Giving an independent brand name to product  Adding new features to the product  Introducing new product all together .

Appraisal of each product line and each product/brand in the line Ex: HUL  Is soap line working properly?  Is it achieving it sales target?  What market share it is maintaining?  Is there too much competition?  Do lime have too many brands  Which brand need to be discontinued  Should the line stretching need to be done to new price slots  .

.Appraisal of each product line and each product/brand in the line Does the line need pruning?  Does the line need filling  Which are the best performing brands?  Which are the weak ones?  The Firms need to be continuous monitor and take decisions to its product line for better profits.

tissue boxes to CD covers. Are we taking it for granted because it is around us at all times? Or perhaps we see it simply as a marketing tool to sell products? When was the last time you were excited by the packaging of a product? Did it persuade you to buy the product? Packaging is not only a powerful selling tool. packaging is hard to be missed in our daily lives. Good packaging can break through the language barrier and can stand the test of time. Yet not many of us see packaging as a form of art.Packaging  Everyday. but how many of us truly appreciate the art of packaging? From food packaging to beverage containers. . we encounter different types of packaging. it is also an effective method of communication that can stimulate the viewers‘ senses.

preserves. protects. sale. informs. In many countries it is fully integrated into government. and production of packages. and sells. . sale. Packaging can be described as a coordinated system of preparing goods for transport. warehousing. Packaging also refers to the process of design. industrial. transports. institutional. evaluation. art and technology of enclosing or protecting products for distribution. and personal use. logistics. and use. and end use. business. storage. Packaging contains.Packaging  Packaging is the science.

compression. temperature. shock. etc  Barrier protection vapor. water Containment or agglomeration . reclosing.Packages can have features that add . display. among other things. convenience in distribution. handling.The objects enclosed in the package may require protection from. dispensing. etc. and reuse  Convenience .Packaging  Physical protection . and granular materials need containment. opening. use. powders. vibration. dust.  - A barrier from oxygen. stacking.Small objects are typically grouped together in one package for reasons of efficiency Liquids. sale.

 Packaging may be described in relation to the type of product being packaged: medical device packaging. . military materiel packaging. and handle the product or inner packages. bulk chemical packaging. For example a transport package or distribution package can be the shipping container used to ship. over-the-counter drug packaging.Packaging Types  Packaging may be looked at as being of several different types. etc. retail food packaging. Some identify a consumer package as one which is directed toward a consumer or household. store. pharmaceutical packaging.

and tertiary packaging on some distribution packs. This usually is the smallest unit of distribution or use and is the package which is in direct contact with the contents. secondary packaging when combining smaller packages. . Tertiary packaging is used for bulk handling. perhaps used to group primary packages together. warehouse storage and transport shipping. depending on the use.Packaging Types      It is sometimes convenient to categorize packages by layer or function: "primary". etc. The most common form is a palletized unit load that packs tightly into containers. "secondary". For example. Secondary packaging is outside the primary packaging. These broad categories can be somewhat arbitrary. a shrink wrap can be primary packaging when applied directly to the product. Primary packaging is the material that first envelops the product and holds it.

Packaging Types .

 Bar codes (below). For consumer packaging. symbols exist for product certifications. Examples of environmental and recycling symbols include: Recycling symbol. Universal Product Codes labels are common to allow automated information management in logistics and retailing. trademarks.Symbols used on packages and labels  Many types of symbols for package labeling are nationally and internationally standardized. and Green Dot (symbol). . Some requirements and symbols exist to communicate aspects of consumer use and safety. proof of purchase. etc. Country of Origin Labeling is often used. Resin identification code (below).

It Allows firm to fight on No-Price Plank Through differentiation . Successful product differentiation creates a competitive advantage for the seller.Product differentiation  A marketing process that showcases the differences between products. as customers view these products as unique or superior. Differentiation looks to make a product more attractive by contrasting its unique qualities with other competing products. The Major attraction and the major benefit in resorting to differentiation is that it takes the firm away form a total price based competition .firms move to a position wherein they can claim a premium in the market    .

or Plant location . Sometimes differentiation does not involve changing the product at all. or distribution methods . using the product.    .Product differentiation  Differentiation can be Achieved through Multiple Sources and in multiple ways: Product differentiation can be achieved in many ways. It may be as simple as packaging the goods in a creative way. It can start from Firm‘s collaboration . or promotion steps. or as elaborate as incorporating new functional features. but creating a new advertising campaign or other sales promotions instead Co‘s can achieve diff. to its after sales service.

Convenience (or timing) 2. So. 3. In fact. your business will be severely challenged. if you do not provide something unique. what are the three elements of product differentiation? 1. Customization.Product differentiation  Being unique in the marketplace provides distinct advantages. Cost Recovery .

this means being faster than your competitor — but not always! If I order drapes as part of a renovation project. for example. consider how you can deliver your goods and services precisely when they are needed. I don't necessarily want them immediately.Product differentiation 1. If I get them too soon. they might get damaged waiting to be hung. In order to differentiate your product from your competitors'. Often.  Convenience (or timing) People don't want to wait these days. I may not need them for six weeks. The company that can deliver what I need when I need it will certainly be better positioned to earn my continued business. However.  . I do want them when the time is right for me.

Even with a product-based business.Product differentiation   2. or special packaging for your best customers. there are still techniques available for individualizing your firm. footwear (ex. Customization . When I order those drapes. automobiles.     . motorcycles. The more you know about your customers' needs — and the better you do in serving those needs to your customers' satisfaction — the stronger your competitive position will be in the market. backpacks in the color you want. sports shoes in school colors). Service-based businesses are particularly capable of customization. Product customization is a rapidly growing field for clothing. They need to fit perfectly to my windows. and I want them in the style and color pattern that goes best in my house. cosmetics. Customization is an element of product differentiation that cannot be over-emphasized. such as customizing your billings. etc. I don't want just any old size or pattern.

Too frequently. It does mean gaining the highest leverage per rupee spent.Product differentiation  3. in fact. Often. Cost Recovery Cost recovery does not mean paying the cheapest price. "I got it cheap" is the consolation prize when you end up with something that really doesn't properly serve your needs . it makes more sense to spend a little more to obtain a product or service that most closely aligns with your needs and brings satisfaction.

they are far too often missing in your efforts to develop and improve your position in the market. Unfortunately. building a steady flow of continued customer satisfaction and business growth. Please take a few moments over the next week or so and look to see how well you do in each of these three elements of product differentiation. To put it another way. Commerce happens when your customers' needs equal your ability to satisfy them. As a result.   . customization. companies that focus on providing these three elements and improving them steadily will be in a much better position to gain and keep a competitive advantage over their rivals. paying attention to these three "c"s will yield a fourth: commerce. and cost recovery — may appear to be simple and obvious.Product differentiation  These three elements of product differentiation — convenience.

Tangible product B.Product differentiation Maximum Scope of diff. Intangible Product  Tangible Product: a) Ingredients/Formulas b) Functional value c) Additional Features d) Packaging e) Design Superiority f) Product Quality/technology/service/operational efficiency . remains with product: The Product can be differentiation along 2 major planks: A.

Antidandruff Oil Clinic plus Antidandruff Shampoo Safola for reduce Cholesterol Functional value Ex: 3M Scotch Tape Videocon Computer controlled fridge Nokia Phone Batteries Microwave .Product differentiation-Tangible Product Ingredients/Formulas Ex: Close –Up toothpaste with gel TTK Prestige with Teflon coating Promise with clove oil Vatika with herbal ingredients Parashute .

Pre-sales service [Banking] Packaging Ex: The Pond‘s cold cream and brylcreem in tubes Application convenience of Harpic The beer Can Economy Packs Sachets Reusable Containers Refill Packs . came with ‗mega sized‘ products and used the ‗mega‘ feature as part of their differentiation effort In TV sets BPL. Philips etc. After sales service.audio and refrigerators industries in India. Onida.Product differentiation Additional Features Ex: The ―mega‖ feature as a differentiation: Companies in the television .Videocon.

Product differentiation Design Superiority Ex: Titan Watches Tanishq Jwellery Automobile industry Product Quality/technology/service/operational efficiency Ex: Godrej Infosys Sony Ford Escoda Nokia Phones Raymonds Rayban Zodiac Kingfisher .

Product differentiation-Intangible Product Dinesh Suitings  Reid & Taylor  Rayban  BMW  Mercedes  Ferrari  Diamonds  .

INDIVIDUAL PRODUCT DECISIONS     Product Attribute Decisions Brand Decisions Brand Positioning Packaging and Labeling .

DEFINITION OF BRAND  American Management Association defines brand as follows : “ A brand is a name. symbol. or design. or a combination of them. intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors. sign. ” . term.

 Companies want to stamp their mark on different sectors and set their imprint on their products.  Brands are a direct consequence of the strategy of market segmentation and product differentiation.THE MEANING OF BRAND The brand is not a product but it gives the product meaning and defines its identity in both time and space.  .

When price is the only thing that counts. the only winner is the low-cost producer. it will probably viewed as a commodity.BUILDING THE BRAND  “The art of marketing is the art of brand building.” . When something is not a brand. ( Philip Kotler ) . Then price is what counts.

BRAND NAME DECISIONS   Individual Names Blanket Family Names  Separate Family Names for all products  Company Trade name combined with individual product names. .

recognize and remember.BRAND NAME It should suggest something about the product’s benefits.  It should be easy to pronounce.  It should not carry poor meanings in other countries and languages.  .  It should suggest something about product qualities.  It should be distinctive.

provide reasons to buy.BRAND IDENTITY AND ASSOCIATION A brand identity or association is anything that is directly or indirectly linked in memory to a brand.  A brand’s associations are assets that can differentiate. affect feelings towards a product and the use experience. The most common association is that of product attributes or customer benefits. instil confidence and trust. and provide the basis for brand extension.  .

 Third. the salience of a brand will determine if it is recalled at a key time in the purchasing process. and substance. commitment.BENEFITS OF BRAND AWARENESS First. and people like the familiar.  Second. awareness provides the brand with a sense of familiarity. there must be a reason. The logic is that if a name is recognized.  . name awareness can be a signal of presence.

Brand loyalty provides trade leverage. a relatively large. Third. . since existing customers are relatively easier to hold. and enduring product. brand loyalty reduces the marketing costs of doing business. brand loyalty provides the time to respond to competitive moves. Second. Finally. successful. satisfied customer base provides an image of a brand as an accepted. Excessive resources are required when entering a market in which existing customers must be enticed away from an established brand that they are loyal to. brand loyalty represents a substantial barrier to competitors. Fourth.BRAND LOYALTY      First.

Brand equity generates value to the customer that can emerge either as a price premium or enhanced brand loyalty.  .DEFINITION OF BRAND EQUITY  Brand equity is a set of assets and liabilities linked to a brand’s name and symbol that add to or substract from the value provided by a producer or service to a firm and / or that firm’s customers.

) .BRAND EQUITY Brand Awareness Brand Identity Brand Equity Perceived Quality Brand Loyalty ( Powerful brands have high brand equity. higher brand loyalty.

TOOLS FOR BUILDING BRAND      Advertising Sponsorship of games and events Social Causes Public Facilities Founder’s personality .

BRAND STRATEGY DECISIONS      Line Extensions Brand Extensions Multibrands New brands Co-brands .

BRAND STRATEGY DECISIONS Category Existing Product Existing Line New Brand Extension New Brand Names Brand Name New Extension Multibrands .

LINE EXTENSION    Line extension occurs when a company introduces additional items in the same product category under the same brand name.” . colours. Line extensions generally have a higher chance of survival than new products. added ingredients. On the down side extensions may lead to the brand name losing its specific meanings. forms. usually with new flavours. Ries and Trout call this “ Line Extension Trap . package sizes and so on.

Brand Extension offers a number of advantages.  -Instant recognition and earlier acceptance -Saves considerable advertisement .BRAND EXTENSION  Brand Extension occurs when a company decides to use an existing brand name to launch a product in the new category.

.The brand name may loose its special positioning in the consumer’s mind through over extension .The new product might disappoint buyers and damage their respect for company’s other products.” .BRAND EXTENSION  Brand Extension also involves risks.a phenomenon called “ brand dilution . .

One of the motives for multibranding is to establish different features and/or appeal to different buying motives.It also enables the company to lock up more distributor shelf space and protest its major brand by setting up flanker brands. . . .MULTI BRANDS  A company will often introduce additional brands in the same product category.

. companies are better off creating new brand names.  When the present brand image is not likely to help the new product. it may find that none of its current brand names are appropriate.NEW BRANDS  When a company launches products in a new category.

.  Each brand sponsor expects that other brand name will strengthen brand preference or purchase intention.CO-BRANDS  Co-branding occurs when two different companies pair their respective brands in a collaborative marketing effort.

PRODUCT LIFE CYCLE The Product Life Cycle ( PLC ) is an important concept in marketing that provides insights into a product’s competitive dynamics. the demand and technology life cycles. one should first understand its parent concept.  To fully understand the concepts of PLC .  .

 Each new technology normally satisfies the need in a superior way and it shows a demand-technology life cycle.  The product exists as one solution among many to meet a need.  A need is satisfied by some technology. but rather with a need.DEMAND / TECHNOLOGY LIFE CYCLE Marketing thinking should not begin with a product or even a product class.  .  The PLC portrays distinct stages in the sales history of a product.

DEMAND-TECHNOLOGY-PRODUCT LIFE CYCLES Sales Time .

STAGES IN THE PRODUCT LIFE CYCLE Sales & Profits Time Introduction Growth Maturity Decline .

in order to succeed. companies can formulate better marketing plans. purchasing and personnel strategies in each stage of their life cycle. Marketers must pursue appropriate marketing strategies in each stage of PLC. The success of competitors is based on creating value for the customer by differentiating their product. it is absolutely essential to constantly improve products to increase the value offered to customers. Products require different marketing. manufacturing.STAGES IN THE PRODUCT LIFE CYCLE      By identifying the stage that a product is in. or may be headed toward. . financial. ( Competitive Differential ). ( V = B/P ). Today.

EXTENDING THE PRODUCT LIFE CYCLE Sales Time •( When the sales of a product starts declining marketers may choose suitable strategy for further growth of product /business/enterprise.) .

Growth. --Changes in number of potential buyers Stages in PLC : Introduction. . And Decline.PRODUCT LIFE CYCLE Reasons for change in behavior of PLC :     --Changes in the consumer needs and preferences --Advancing Technology --Competition. Maturity. Government Policies etc.

MARKETING STRATEGIES IN THE INTRODUCTION STAGE Promotion High Low High Price Low Rapid Skimming Strategy Rapid Penetration Strategy Slow Skimming Strategy Slow Penetration Strategy .

flavors. It shifts from product-awareness advertising to product-preference advertising. .MARKETING STRATEGIES IN THE GROWTH STAGE       It improves product quality and adds new product features and improved styling.. products of different sizes.e. It increases its distribution coverage and enters new distribution channels. It lowers prices to attract the next layer of price-sensitive buyers. It adds new models and flanker products (i. and so forth that protect the main product ). It enters new market segments.

 The manufacturer assume a greater share of the total promotional effort in the fight to retain dealers and shelf space in their stores.  .MATURITY STAGE Sales are increasing but at a decreasing rate.  Profits are beginning to decline.  Price competition increases.

  . we can devide Maturity Stage into three stages :  Growth Maturity : When the rate of sales growth starts to decline because of distribution saturation. Stable Maturity : When the rate of sales growth starts declining due to market saturation.MATURITY STAGE To understand better. Decaying Maturity : The sales level starts to decline as some of the customers move towards other competitive and substitute products.

MARKETING STRATEGIES IN THE MATURITY STAGE  Market Modification Product Modification Marketing Mix Modification   .

More frequent use .New and more varied uses .More usage per occasion .MARKETING STRATEGIES IN THE MATURITY STAGE Market Modification   Expand number of users : .Enter new market segments .Win competitors’ customers Increase annual usage : .Convert non-users .

accessories ) that expand the product’s versatility. taste. materials. additives. or convenience. reliability. weight. speed. safety.MARKETING STRATEGIES IN THE MATURITY STAGE Product Modification   A strategy of quality improvement aims at increasing the product’s functional performance . . A strategy of feature improvement aims at adding new features ( for example size.its durability.

)  A strategy of style improvement aims at increasing the product’s aesthetic appeal. The periodic introduction of new car models amounts to style competition rather than quality or feature competition. .MARKETING STRATEGIES IN THE MATURITY STAGE Product Modification (contd.

MARKETING STRATEGIES IN THE MATURITY STAGE Marketing Mix Modification  Prices  Distribution  Advertising  Sales Promotion  Personal Selling  Services .

The product review committee makes a recommendation for each dubious product--leave it alone. modify its marketing strategy. R&D.MARKETING STRATEGIES IN THE DECLINE STAGE Identifying the Weak Products To do this. or drop it. many companies appoint a product-review committee with representatives from marketing. manufacturing and finance.  .

) Determining Marketing Strategies : ( Go Strategy ) Continuation Strategy : -Increasing the firm’s investment ( to dominate the market or strengthen the competitive position ) .MARKETING STRATEGIES IN THE DECLINE STAGE (Contd.Maintaining the firm’s investment level until the uncertainties about the industry are resolved.)  . (Contd.

Harvesting Strategy : .MARKETING STRATEGIES IN THE DECLINE STAGE (Contd) Determining Marketing Strategies : ( Go Strategy ) Concentration Strategy : .Divesting the business quickly by disposing of its assets as advantageously as possible. by dropping unprofitable customer groups. while simultaneously strengthening the firm’s investment in lucrative niches.Decreasing the firm’s investment level selectively.  .

When a company decides to drop a product. .MARKETING STRATEGIES IN THE DECLINE STAGE (Contd)  The Drop Strategy . . It must also decide on how much parts inventory and service to maintain for past customers. the company can probably sell it to another firm. it faces further decisions. it must decide whether to liquidate the brand quickly or slowly. If the product has strong distribution and residual goodwill.If the company can’t find any buyers.

NEW PRODUCT DEVELOPMENT PROCESS (1) Idea Generation  (2) Screening  (3) Concept Development and Testing  (4) Marketing Strategy  (5) Business Analysis  (6) Product Development  (7) Market Testing  (8) Commercialization  .

Evaluation : The consumer considers whether to try the innovation. Adoption : The consumer decides to make full and regular use of the innovation.THE CONSUMER ADOPTIONPROCESS (STAGES IN THE ADOPTION PROCESS )      Awareness : The consumer becomes aware of the innovation but lacks information about it. Interest : The consumer is stimulated to seek information about the innovation. Trial : The consumer tries the innovation to improve his or her estimate of its value. .

ADOPTER CATEGORIZATION ON THE BASIS OF RELATIVE TIME OF ADOPTION OF INNOVATIONS Time of adoption of innovations .

3/8543847050.:780394 /1107039.2089703903 -7.-47.7907 70850.9.425.3/83.3/3.-7.4.0 2.9..7093011479 .0-7.9 4907-7. #$ 4 -7..3/57010703.0475:7...3/34.80 3903943 .989.3085.

08 ./083898394.425099.39..8 %41::3/0789.059841 ! 43084:/1789:3/0789.34410.05932.3/98 5.9 574.3 25479.3/.3/90.574/:.9 8 .910.0/3.3/ 90.2.43.!# &% %0!74/:.43.7039.059 90/02.0 ! 8.70939.43.

.

08894741.90898.344 .3090. .9810890300/3./02.3942009.8:50747..3/9848.989.574/:.344 10.%    .0 %0!54797. 8.9 .083 908..3/ 90.843084:943 .709393384:/349 -039.300/ 300/88.9470.03.9079.88 -:97.3443472.8/893.9810/-8420 90.574/:.. 300/ %0574/:.2432. 574/:.9.

 %   !# &% $ $.08 %20 .

30 .$%$%!# &% $.9:790.943749.08 !74198 %20 3974/:.

.83.-84:90 088039.9894 3.04190710.70.3/50784330 897.9.308.89..7093 897.557457.70935.0574/:..  2.9:73 5:7.-00..983 47 2.392574.4389.00/ 98.7093 13...$%$%!# &%  /039139089.09.574/:.900830.94.7/ ..89.3:1.041! %4/.900830.31472:.0 .8090./0/94. 347/07948:.90 -099072..:0411070/94.:8942078  ' .902.425.98706:70/11070392..7090782:895:78:0.3.38 !74/:.

:014790.08841...:894207-/1107039.93 .9  425099.4250994788-.! %08:.93907 574/:.80/43.01107039.70. .

0841.44808:9.7090782.-0897.989.798/0.574/:.%%!# &%  $.9.08 %20 W 03908..33 2.90147 1:7907749 41574/:.

-:83088.

039075780 .

30 .083!  3974/:.3%0.30833:2-0741549039. .438:207300/8.344 42509943 4.-:078 $9.4741 !  .0732039!4.3.08 /.943 749 .308390.0809....3/ 57010703.8438147.!# &% #0.9:79 3/ 0.303-0.

943 $97.943 $97.90 #.5/ $223 $97.0 4 4 #.90 $4 !03097.90 .#%$%#%$% %# &% $% !7424943   !7.5/ !03097.90 $4 $223 $97.

/.910.80898/897-:943.3/2574.478  ..4.0894.9902.9.//83024/08.07983 .0 80389./...98  0 574/:.0741 57.9841/1107039808 1.9 9039078302.0.3/1.96:.9 .9:708.3574/:.0/893 9.#%$%#%$% # %$% 92574.07.3308 9407857..990309.3/ 03907830/897-:943.0-:078 981981742574/:.08574/:.3/8414799.997.3/.703088 .//830 574/:.0798394574/:.307574/:.70.9 57010703.0 .957490.7098020398 93.

907 8.70.70.425099433.0.88:20. /0.03907894708 .837.703.3/0.9:707.704190949. 0114793901994709..83-:9.57424943.08.078 ..70.%&#%$% $.808 %02.70.30 !7.90 !74198.3/80185.3:1.9.70-033394/0.

08749 89.-0..08749 89.30-0.:894207824.98  .0.798/0..3.:8041/897-:9438.943 $9.79894/0.9:7.79894/0.08 749.3/-09907 0.9:7.9:7903907.9:7903907.943 0.7098.90418.3/8:-899:90574/:.33/:0942.425099.080.%&#%$% %4:3/0789.0394970089.089.9:79$9./0 .90418..7/84907 .30 .094.3/0.884204190.9:79%08.

.94/1.#%$%#%$% %&#%$% ..7094/1.943 !74/:.943 ..943 .70934/1.

3/3:2-0741:8078 43.843 0.079343 :8078 3907302..70/:808 .80.0 4701706:039:80 470:8.425099478 .#%$%#%$% %&#%$% .943 5..33:...7098020398 3.7094/1.05074.3/2470.70.:8942078 3.:8.

92574.94/1..904110.28.9:708 1470.3/90574/:.9.0303.9 8 .907.109 47.0 .28 .8 .90416:.02039 .99 8.9:702574.//9.9 3.943 897.250 80 09 2.02039 ..70.//33010.9 81:3.8390574/:..078.890 897.943.0884708 9. 5071472.43.-9 70.08  .905.0 98/:7.-9  8500/ 9.#%$%#%$% %&#%$% !74/:.3.

9079.9:70..08909.425099437.439/ 897.02039 .#%$%#%$% %&#%$% !74/:.9 8.28 .90418902574.93.70.724/08.8390574/:.42509943 ..36:.943 . %05074/.947 10. .3974/:.94/1.24:39894890 .550.94341 30.

$03 $07.#%$%#%$% %&#%$% .70934/1.07983 $.08!7424943 !07843.08 .08 897-:943 /.943 !7...

42299009 705708039.09.430 24/198 2.3:1.9 0.!74/:. 574/:.98 %4/498 2.55439.3/13.42299002.7093897.0.0. 70.3.08.9431470.0 %0 574/:.90 47/7459 .3...9.9 70.308.0817422../:-4:8 574/:.#%$%#%$% $% /03913900.7093  #  2.425.9:73.42203/.970.

943$97.9008 4$97.425099.90 4393:.707084.8390172 83.7093$97.3390172 83.90  3.7094789703903 90.0892039 94 /423.0:3990:3.39.3908.079.#%$%#%$% $% 439/ 0907233.-4:9 903/:897.0/  439/ .0892039 0.70.90902.0548943 .

85488-0 .-/85483 4198.304:8 89703903390172 83.8.90 0.90 43.08920393 :.90  .7093$97.7.88098.089390-:830886:..9.7.0 -/74553:357419.0893$97.0 800.03.-0 .08 .9008 4$97.:89420774:58 082:9.04:8.8390172 83.70.39.0397.9.943$97./.#%$%#%$% $% 439/ 0907233.08920390.

9090 -7.0942. 574/:.425.3/6:.39..3 913/.3-:078 9 2:89/0./00907946:/.:8942078 .889743/897-:943.4784 92:89.3/ 807.-80994..34907172 190.9.89.3/0.5.081:7907/0.03947.8438 190 574/:.3..84 /0.31475.3/ 708/:..44/ 90.9 91.3..7983.425.90 03./0894/745./04342:.3 574-.425.#%$%#%$% $% 439/ %0745$97.

.90.0307.0452039  .3/ %0893  .70033  43.0590.709%0893  42207.90  :830883.!# &%' !% !# $$  /0.88  !74/:.943  $..943 .0452039.7093$97.

8 31472.943.438:207-0.704190334.4208 .943%0.0 1:.438:207970890334.3/70:.%0..% $&# !% !# $$ $%$% !% !# $$ ..943 942574...943 .-4:990334.943-:9.438:207.:..438:207/0..943./08942.904198 .438:2078892:.0847070892.:0 /45943%0.943 %7.703088%0..438/078 0907949790334..943 .-4:99 3907089%0.7:804190334.90/94 80031472..

 !%#% #%  % $$ #%'%   !%   '% $ %2041.9438 ../4594341334.