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Product Management

Session 8 By Sandy De Mel

learning objectives_1
• Understand the product lifecycle concept, its influence on marketing strategies and its limitations • Appreciate the importance of product positioning and how it both affects and is affected by marketing strategies

learning objectives_2
• Understand the scope and implications of the various decisions that management can take with regard to product ranges, including deletion • Define the role and responsibilities of the product or brand manager

maturity and decline . growth.Product Lifecycle (PLC) Defined The Product Lifecycle is a concept suggesting that a product goes through various stages in the course of it’s life: introduction.

1 The Product Lifecycle .Figure 8.

eg Active Health Drinks Market .

• Why is the product going into decline? • Is the environment right for a rejuvenation strategy? • What does the product name mean to the market? • Is there still a segment worth reaching? • Can value be created for customers? Should Organisations Introduce New Products or Rejuvenate Old Ones? .

co.Famous Grouse is a Mature Brand Source: © The Edrington Group .

Options for Brands in Decline Milking or harvesting Phased withdrawal Contracting out or selling .

Figure 8.2 PLC Variations .

2 PLC Variations .Figure 8.

Wristbands: A Fashion Product .

2 PLC Variations .Figure 8.

Brand Variables Affecting PLC Positioning Personality Identity Brand name .

late majority and laggards. Customers can thus be classified as innovators. . depending on their attitude to innovation and new products. and their willingness to take risks. early majority.Diffusion of Innovation Defined The Diffusion of Innovation is a concept suggesting that customers first enter a market at different times. early adopters.

Jimmy Choo Influences Others with Early Adopters .

Factors Affecting the Rate of Adoption Relative advantage Perceived risk Communicability Divisibility Compatibility Complexity .

Competitor Entry Timing Pioneers Early imitators Early differentiators Early nichers Late entrants .

eg Microsoft’s Xbox versus Sony’s PlayStation .

Creating a Balanced Product Portfolio • Retain and maintain existing products • Modify and adapt existing products • Delete old products • Introduce flow of new products .

Stages of Selecting a Product Position Conduct market research to establish important attributes Shortlist existing products that offer attributes Identify ideal level of attributes and ratings of brand’s attributes .

Figure 8.4 Perceptual Map .

Figure 8.5 Multidimensional Perceptual Map .

Implications of Repositioning • Quality • Design • Performance Jaeger retained its classic looks but incorporated more fashionable design .

com .Lucozade Repositions Source: © GlaxoSmithKline http://www.lucozade.

Product Range Management Extending the product line Filling the product range .

Extending Product Lines Upwards • Achieve higher margins • Enhance image • Builds consumer staircase Downwards • Achieve higher volume • Attack competition • Build large base of sales .

eg Volkswagen Overextended .

Questions to Consider • Will sufficient customers emerge to purchase new product? • Will new product cannibalise others? • Is it a significant profit opportunity? .

Deleting Products • Phase out • Run out • Drop or sell eg Low Carb KitKat .

from launch. through any modifications. .Product Management Defined The job of the product manager is to manage the product through its lifetime. to its eventual demise.

resources and strategies • Justify investments of resources .Tasks of the Product Manager • Produce annual product plan • Specify actions.

Essential Criteria for Building a Brand Resources Quality Timing .

International Branding Advantages • Increased market size • Economies of scale • Competitive advantage Disadvantages • Dispersed geographically • Avoidance of cultural problems • Heavy resource requirements .

depending on their attitude to innovation and new products.Key Terms_1 • _____ is a concept that suggests customers first enter a market at different times. Diffusion of innovation . and their willingness to take risks.

Extending the product line • _____ means adding further product items into a product line to fill gaps within the range. Filling the product range .Key Terms_2 • _____ means adding further product items into a product line to extend coverage of the market.

growth. Product lifecycle • What title is used to describe the individual responsible for the day-to-day management and welfare of a product or family of products at all stages of their product lifecycle? Product manager . maturity and decline.Key Terms_3 • The _____ suggests that a product goes through various stages in the course of its life including introduction.

some are still in their growth stage while others are waiting to be introduced. ideally balanced so that some products are mature. Product portfolio .Key Terms_4 • The _____ is the set of different products that an organisation produces.

Key Terms_5 • _____ refers to the development of a product and marketing strategy that places the brand as close as possible in the minds of target customers to their ideal in terms of important features and attributes and clearly differentiates it from the competition. Product positioning .