Product & Brand Management

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    Notes on slide 1

    . When we say product we usually mean physical goods, but services are also included in them; yet to clarify we can say product and services; also called offering . Ideally a manager does not do anything individually; rather uses resources like human, material, and financial to achieve the objectives of the firm; in practice there is a balance between coordination and hands-on work, which will vary from firm to firm and within the same firm based on the leadership style of the manager

    . Perceived need – may occur when an ad or a sales representative makes a convincing pitch . May be both non-durable and durable

    . The advertising manager is responsible for all promotion activities except sales . In some companies the ad manager has the title of Marketing Communications Manager . Classic brand management structure developed by P&G in 1930s . Commonly used where different products use the same channels of distribution

    . Product or brand champion

    . Narrow – inability to step back and ask more fundamental questions about customer needs . Centralized – may lose geographic/regional focus on product benefits to target customers . Short-term – due to this there has been a dramatic increase in the use of short-term marketing tools such as sales promotions for consumer packaged goods, may stifle innovation. Several salespersons – particularly for industrial products, overload marketing data information. Managers will have individual budgets, ad agencies, media channels partners

    . The advertising manager is responsible for all promotions activities except sales . In some companies the ad manager has the title of Marketing Communications Manager

    . Segments - may be industry, channel, region of the country or world, or customer size . Differences – lead to differences in the marketing strategiesand tactics used to appeal to the customers in the segments

    . The advertising manager is responsible for all promotional activities except sales . In some companies the ad manager has the title of Marketing Communications Manager

    . Embedded – it is common for sales and marketing research to be separate functions in most organizations

    . The Web is a new channel of distribution - early 1990s, communication medium, way of creating a community around a brand; can be used for both customer acquisition and retention, and brand building; the Web needs to be integrated into the marketing and communication plan . IS – better and more timely information on market share, sales and distribution ; scanners, database marketing, data mining . A major trend started in the 1990s was the realization that one of the greatest assets a company has is its set of brands and the image and confidence the consumers have in them, brand equity – the value of the brand name, not just descriptive labels but are product attributes that require consistent investment for maintenance and enhancement . Balance of power has shifted from manufacturer to retailer . Lifetime value of a customer concept, stream of income from future purchases . Worldwide competition; need for international experience and knowledge of marketing in different cultures and regions; formation of trading blocks, NAFTA, EU, MERCOSUR .

    . At the center is the core or physical product, distinctiveness or differentiation is based on the outer layers which are subjective, and the service factors are on the outermost, especially if the physical product features have low differentiation

    . 6 major market factors impact market attractiveness . PLC – product life cycle

    . Is an important piece of data about any market . It is clearly an important determinant of the likelihood that a product will generate revenues to support a given investment . Both large firms and entrepreneurial firms might find large markets attractive . Large markets tend to draw competitors with considerable resources making it unattractive for small firms . Thus, absolute size by itself is not sufficient to warrant new or continued investment

    . P&G developed the US market for disposable diapers, but the high growth rate supported the entry of other firms such as J&J and Kimberly Clark . In technology firms fast-growth means dramatic shift in market share and virtual disappearance of rival products . In the Internet browser market, Netscape had 13% of the market and Mosaic 60%; by 2002 Netscape had 8%, Mosaic had disappeared, and Microsoft’s Internet Explorer held 91% . Thus, growth brings the prospects of increasing revenues but also dynamic market structures in terms of competitors

    . In the introduction and growth stages thesales grow rapidly, in maturity it levels off,in decline it drops steadily . In maturity the sales volume is high, growth rate is low, market is at its peak – large Rs volume with slow growth – like in the consumer packaged goods – classic patern for soft drinks, fast food . Not always clear – introduction and growth may be attractive to pioneers from a long-run market share perspective . Product in the growth phase are not ensured success – failures of Osborne and Commodore personal computers, and AT&T and HP in the home PC market

    . Inter-year – like ice cream, woolen clothes, rain gear, agriculture is affected by climate. High capital intensive businesses such as automobiles, steel, machine tools are often affected by . Businesses tied to interest rates such as real estate, financial services are also susceptible to cycles general business conditions . Many firms attempt to develop products and acquire other businesses to eliminate or offset inter-year sales cyclicity

    . Differences in profitability across industries is due to a variety of underlying factors like factors of production (capital, labor, raw materials), manufacturing technology, and competitive rivalry . Profitability varies with time, variance in profitability is often used as a measure of industry risk . Semiconductors offer abnormally high returns when demand is good but poor returns when it slumps . Food related industry on the other hand produce relatively steady, if unspectacular, profits . Product managers must make a risk-return trade off, evaluating expected returns against the variability in those returns

    . + is positive, desirable, - is negative, undesirable

    . How are barriers to entry set up?

    . Scale – barrier in the automobile industry, Ferrari is content to serve the high priced market segment; in non-manufacturing – hospital supplies – profit margins are better for larger orders; in service industry – it costs about the same to set up for a few customers or retailers as for many, large advertisers usually get quantity discounts when buying block media time on TV, radio, others, so it is hard for a new entrant to compete . Large capita – for manufacturing, chain of stores, or marketing programs . Switching – cost of switching form one supplier to another, high in the computer industry, FedEx has given its corporate customers software with they can track their own packages, so it is difficult for another delivery company to make the FedEx corporate customer switch; airline industry offers mileage program so customers get a free trip after a certain number of miles; it is hard to create switching barriers in the consumer products industry, consumer change brands frequently . Distribution – new entrants can find it difficult to obtain shelf space to compete with multinationals; supermarkets may charge slotting fee; CP and P&G copied Minnetonka, Inc’s innovative pump for hand soap; barriers change over time due to expiration of patent; lock up distribution and supply arrangements . A product manager can ask: is there anything I can to make it more difficult for a new entrant or a current competitor to compete against me legally?

    . Low profits means supplier cannot charge more . Backward integration – if computer manufacturers make their own chips, forward if they open their own retail stores . Buyers – say customer – has detailed pricing information on cars can negotiate the sticker price by choosing the right manufacturers options available . The product manager’s objective is to decrease buyer power by increasing product diff., helping customers become more profitable through services such as technology assistance or manufacturing/product dev./marketing related consulting, and building switching costs . Buying power of individual consumers in not substantial, but as a group or co-operative it can be high; industrial businesses can have high buying power . High buying power is not attractive if you are or want to be one of the competitors in the markets because buyers can force down prices, and play competitors against one another . Governments have high buyers power generally

    . High supplier power is not attractive as they can dictate price, delivery conditions to the buying category . Concentrated – dominated by a few firms, few microprocessor manuf. - like Intel, AMD; few supercomputer manuf. – like IBM, Cray, NEC . No substitutes – OPEC power increases and decreases, is now on the rise, they produce oil and natural gas, and the global requirements for energy is such that coal and other sources are not strong substitutes . Differentiation – AK Steel supplier to GM – offers delayed payment plan, guarantee of no work stoppages, a demonstration of cheaper steel can be used in certain areas, extra services such as supplying steel with adhesives for certain applications . Supply limited – demand is high, buyer has little option to extract special terms . To counter it – product managers can look for new sources of supply, substitute materials, other strategies

    . Rivalry – Compaq – Dell in the PC business, Intel – AMD in the microprocessor business, Disney – Six Flags in amusement parks, Sony – Matsushita in consumer electronics . Many or balanced – fast-food, automobiles, PCs; Boeing and Airbus (EU) became balanced by Boeings acquisition of McDonnell Douglas . Slow growth – in a mature market slow growth can come only from a competitor . High FC – pressure to run at full capacity to reduce unit costs – so capital-intensive industries like paper and chemicals are highly competitive . Lack of differentiation – product looks like a commodity . Personal – Sun’s Scott McNealey and Microsoft’s Bill Gates; Oracle’s Larry Ellison and Siebel’s Tom Siebel, even thoguh Siebel woked for Oracle

    . Soft drinks high – more generic, broadcastmedia, tractors few

    . Travel industry – during recession resorts are empty, rates drop

    . (+) is positive, desirable, (-) is negative, undesirable. Helps to decide whether firm should be or continue to be in the category, product manager can compete better in the particular product category

    . These factors are outside the control of both the firm and the industry, though the industry may have some leverage – external . External factors are unrelated to the product’s customers and the competitors that affect marketing strategies . Vulnerability of a product category to changes in the environment is an unattractive characteristic, to be dealt with . Changes in the environment can be opportunities to gain competitive advantage

    . High-tech – computers, technology changes in 18 months . Home banking has not become very popular – customers have a desire for customer service . Packaged goods industry – although packaging technology improves – the sales are driven by marketing programs

    . Interest rates – affects capital goods industries – machine tools, farm equipment, mainframe computers

    . Alcohol, tobacco . Pharmaceutical. Intervention – helpful to the industry, auto and textile dumping, agro restrictions helps

    . Trends – important to consumer product companies. Derived demand – generated by the consumer for B2B . Young adults – affluence – furniture, electronics, appliances, upscale fast-food, clothing, financial services, travel services . Mature adults – want to reduce their psychological age – sports cars, clothing, financial services, travel services, over 40 years . Children – indirect purchasers . It is said that – today customers can pretty much have what they want when they want it and at the price they wish to pay – airline ticket booking via Internet, due to information . Socio-economic trends

    . Commercial data services, standard industrial classification, SIC code, used by the US Govt. . Managerial judgment – using primary data – talking to distributors; using secondary data – salespersons reports . Behavioral data – secondary data from commercial firms – A. C. Nielsen or Information Resources, Inc.; households are enrolled with the firms and their scanning data at the store is analyzed by them . Customer judgments – primary data

    . Generic category of deserts; developed through focus group research that identifies products satisfying a given need . Product brands are placed near the vectors; then a judgment can be made as to what the competitor set might be . 1) judged overall similarity – for a pair of products . 2) similarity within consideration set – large set of products divided into groups in which each is a substitute for another . 3) product deletion – in a group that are substitutes for each other, if one is deleted or not available, which one would the customer select from the choice set or . 4) substitution in use. Perceptual mapping – is part of using customer judgment – judged overall similarity measure

    . C I gathering is for large as well as small firms . Microsoft deployed a team of engineers and marketers specifically to track Linux, the fast-growing, free operating system that had become popular. The team has attempted to convince potential corporate users that Linux is nota real competitor to windows . Frontier Airlines hired former United Airlines planning executive and its planning director to get ‘inside’ United’s corporate head; instead of scheduling more flights Frontier learned that if it flew only twice a day to a city, United was not likely to increase its capacity on that route . Tom Sternburg, founder and CEO of Staples, the office supply superstore, drops by one of his stores and a competitor’s; focuses on what the competitor is doing well – customer service, store visibility, displays, how easily the prices can be read

    . Product managers should always begin a competitor analysis with a search of secondary sources of information . Internal sources – information about competing products already exists within the company or division in past marketing plans, special strategic studies, lying around in someone’s office . Audits – for publicly held companies – stock market companies . Government – regulated industries like power, insurance, infrastructure development have to reveal a lot of information to the govt. like pricing, or to obtain contracts and bids, which are public information

    . Most underutilized source, interact with the customer on a regular basis, are in an excellent position to find out about sales pitches, pricing, delivery schedules on a routine basis, merely by observing, can send information to corporate wirelessly with a notebook or laptop, sales report sheets can have a competitor tracking section for intelligence gathering . Suppliers – are willing to give information about competitors to impress potential buyers and high volume clients, carton manufacturers name and address is on the carton – calling them can provide information on the volumes on account of the number of cartons purchased by the customer . Customers – may feel it is not ethical or in their interest of time and effort, but some may give their opinion about the product they have used or someone they know has used . Employee can observe changes in packaging, price, shelf display at the supermarket or store . Firms develop reports, forecasts – as part of their business – e.g. media spending by brands, advertiser spending in the various media . Consultants – can be hired to develop special reports, as opposed to generic reports used in secondary data . Investment bankers – develop detail analysis of prospects, they can provide information to a potential new client, can be part of secondary data as well

    . Reverse – purchase the product and take it apart, or try it, or taste it; one can purchase and use the software, open a bank account; the information can be used as bench-marking for quality and cost of manufacturing or assembly; Xerox benchmarked Canon copiers and tried to beat each component of the latter’s machines on cost and quality; in designing the Lexus, Toyota bought competitor’s cars, including 4 Mercedes, a Jaguar XJ6, and 2 BMW’s, put them through performace tests, and then them apart . Test markets – some companies test market products in limited areas of the country or the world to better understand decisions about pricing, advertising, and distribution . Hiring – when hired new employees are required to sign a non-disclosure agreement, so when they leave they cannot reveal any company information; HP does it with a training program, video, that defines how HP interprets ‘trade secrets’; knowledge on marketing strategies and plans may help a newly hired senior manager in competitor analysis for the new employer

    . Primary – collected directly . Secondary – collected by someone else, library, internet, published information

    . Relative importance of the attribute is indicated by weights – an index can be computed which can give a good idea of strength and weakness of your own product

    . Capabilities – dose the competitor have the resources to pursue such an objective

    . These are at product level; at corporate level they may be return on investment or others . In 1998 Boeing announced in a business publication that it was going to emphasize profits over market share – who is the competition – this was good news for Airbus, can focus on global market share

    . A product manager can monitor these actions by rival brand managers

    . Can be interpreted as a retreat, perhaps only temporarily, from active and aggressive competition in the market

    . Companies from Japan, Korea, Singapore have done that – in the US

    . Leveraged buyout . Federal Express bought its own planes in mid-1970’s – Emery Air Freight was slow to respond

    . The key is to find which customer groups the competitors have targeted; can avoid segments in which there is intense competition and one can determine under-targeted or non-targeted segments that may represent opportunities . Core – is the basis on which the rival is competing, its key claimed differential advantage, which is a critical component of strategy because it forms the basic selling proposition around which the brand’s communication are formed; also called the brands positioning or value proposition . Two types of differential advantage: based on price/cost or on product features; products are usually positioned on price and quality dimensions, although some choose a value positioning with midrange price and quality; price differences – Boston Consulting Group – cost goes down with volume so price can be lowered and margins can be maintained; quality difference – real pr psychological or perceptual difference – such as service, packaging, delivery as well as material – IBM’s core strategy since its inception has been service based – Reebok’s ‘U B U’ campaign stresses individuality . Physical product differences stressed in industrial, durable, or new frequently purchased product; mature products or products with similar physical attributes or commodities often emphasize perceptual differences

    . Customers see these decisions in the marketplace, but they are neither exposed to nor do they particularly care about a product’s marketing strategy; customers are exposed to price, advertising, and other marketing mix elements

    . Product – a major determinant of a firm’s capabilities, at least in the short run; less easily changed than price or advertising , . Is price uniform in all markets, is there a quality price differential the competitor has, are discounts being offered . Are sales people aggressive in obtaining ne accounts, what are their commission rates?, what media are being used for ad . Have channels of distribution shifted? – is competitor changing the entire system – opening its own retail, direct marketing

    . Internet, brochures, provides information on the brands major strengths , positioning information – provides information on core strategy . Sales force – informal contacts, trade shows . Trade ad – reveals the segments being targeted (location and media used) and the differential advantage (from ad copy) being touted . Tracking services or yourself, TV ad messages (differential advantage) and programs they appear in (target segments) – TV ad good for determining core strategy because the nature of the medium prohibits communicating all but the most important messages – print may deliver more core information . Implementing strategy information – distributors, salespeople, customers, ad agencies, company’s own employees, stockholder mailings, use of the product; it takes market sensitivity, sophisticated management information systems can also be used

    . Michael Porter – Competitive Advantage – developed (1985) a concept called value chain that can be used to compare a brand or company’s strengths and weakness against another . An important point made by the value chain is that differentiation can be obtained through efforts of the whole corporation, not just through marketing . One way to differentiate is through inbound logistics, that is, through the selection of the highest-quality raw materials and other inputs including technology – Cray in supercomputers . Second – through operations advantages – McDonald’s has been the fast food market leader throughout the world due to its significant investments in training programs that produce consistency in service and product quality . Outbound – third basis – speedy and on-time delivery such as FedEx ‘absolutely and positively overnight’, Premier Industrial Corporation distributes nuts and bolts, seemingly a commodity, but differentiates by agreeing to ship in any quantity desired by the customer, and has higher margins . Marketing – also serve to differentiate – IBM sales are able to satisfy the customer better than competitors . Service – is an important differentiator – as has retailer Nordstrom found . The product manager can use the value chain concept to check at each step of the process if and how a competitor is gaining competitive advantage in the category

    . Blank audio cassette market – early 1970 – early stage of the PLC; Gillette’s Safety Razor Division was considering entering the market, as was Memorex, a manufacturer of computer tape and related products; G had competitive advantage over M in marketing finance, but at a disadvantage in terms of R&D, manuf., and the apparent match of skills and image to the cassette category, in the minds of the customer; M succeeded and G failed in test marketing

    . 1) quality, value chain, benefits who, where, when, why . 2) retail, to trade . 3) total effort in Rs., methods strategy/copy, media, timing, total effort in Rs. . 4) distribution method/coverage . 5) entry stage in PLC . While doing the Competitor Analysis the product manager should not lose focus on the customer; it may be better to concentrate directly on the customer instead or ignoring them; if a balance is desired – concentrate 70/30 on customer/competitor, or at the most 50/50

    . Technology, scientists/engineers, funding; quality of competitor’s new product development efforts, a long-term threat in a product category – total quality management improves this capability . Manufacturing, skilled employees: physical, human resources; for a service firm it is the ability to deliver the service . Sales force, distribution, advertising, funding; how aggressive, inventive . Debt, liquidity, cash flow, budgeting system; limited financial resources hamper effective competition – how the limited or sufficient resources is allocated among the product categories is critical . Profile of key people, decision process, planning, staffing, organizational structure; P&G replaced the manager for its coffee business in the US with a coffee general manager from the UK with a reputation for developing new products – he launched 4 new products in 15 months

    . The factors are listed descriptively; a rating is given say from 1-10 for each factor; the manager is forced to evaluate own product honestly on a factor-by-factor basis; the overall rating gives a more global feel for the toughest competitors in the market, especially for the future, which may not necessarily be reflected in the current market shares or profits

    . To unseat a market leader by frontal attack in its primary market segment is to provoke violent reactions; whereas a strategy that nibbles away at secondary markets (niche) is more likely to go unmatched. eBay’s key product is online auctions – attempts by Amazon.com and others to enter online auctions are considered to be a strong threat to eBay’s viability and are met with increased promotions and advertising and expansion in the number of auction categories . Coca-Cola launched new coke which failed on the basis of taste – the original coke was reintroduced as coke classic – Coca-Cola held on to new coke and repositioned it several times even though it did not sell well after its introduction

    . Trend continue – high-quality, high-price; appealing to mature consumers . Link - Bethlehem steel spent billions to upgrade its manufacturing; competitors could forecast that B would be able to simultaneously cut price and protect margins . Simulate – Corning Glass – Corning Ware line was coming off patent – used role-play by own managers as to how Libby-Owens-Ford and Anchor Hocking would enter the business to preempt their entry strategy; Charles Schwab and Company – brokerage – eSchwab online business – Merrill Lynch’s interest in entering the Web business Schwab managers – role-play

    . Customer relationship management – CRM – systems that emphasize IT apparently have not paid off, with a $100 M investment in recent years . Relationship marketing is important with a focus on understanding customers rather than data collection and warehousing

    . These are descriptive variables:. Not clearly differentiated in terms of their behavior to the product. Relationship between these variables and purchase behavior can be weak . Even less useful than the above two . Widely used as a basis for segmentation and advertising themes; values and lifestyle – VALS typology

    . The topologies are often related to purchasing patterns and afford the product manager the opportunity to match potential buyers with the appropriate media and message to communicate with them

    . These are descriptive variables:. Use – light, medium, heavy . Service – more or less . Purchasing – quality, price, service . Many of the same variable sare used to segment for consumer and industrial goods in global markets

    . Company may not have dreamed of the use; customer may have purchased the product for a different reason – backing soda for backing, not leaving in the refrigerator or putting in the drain to deodorize . Used at home, office, outdoors – where; how

    . For rational decisions, customers essentially compare alternatives on features via a multi-attribute model

    . Done by using focus groups . Done by direct questioning . Done by direct questioning

    . Two Dimensional Map for a Bank . Any two attributes or dimensions can be looked at. For example – brands of cars – a map may be created based on quality and performance . Another two attributes may be – safety and performance . A – market leader . F – bank. Firms product, car, it may have high quality and high performance but may be less than the market leader A, or the quality may be better but not performance, or performance may be better but not the quality, the firm must objectively determine this before positioning the product . One can have low performance and high quality if the product is launched but not ready for the market . One can have low quality and low performance if the product is not formulate or designed well and the materials or components and finish are not of high quality . One can have low quality and high performance if the components are substandard but the technology is new, innovative, and leading-edge

    . While the actual analysis and design of conjoint studies are more complicated than this, the basic ideas are the same

    . Routine – if a product has little market share and the objective is to increase it, the product manager must ‘shock’ the customer into considering the product to break the routine; promotions, significant price breaks, and free samples are useful shock devices

    . Essentially it is the net financial benefit to the customer from using one product versus another . Value is provided by the performance features of a product, and the before, during, and after-sales service . Source of value is basically the image of the product, including how the product ‘feels’ – sporty, luxurious, high-tech – and whether that feeling matches the image the customer wants to project; price is a part of product image, some prefer high-price – sign of quality or status, others low-price

    . If sales are constant with increase in price - is generally of greater value than one for which demand slumps . Difficult to track compared to directly spoken and written comments

    .New-products – indicate that the total gap between customer value and company costs is sufficiently large to allow for profits even when more companies divide the market

    . Importance – this estimate could focus on individual customers or market segments and may simply be projected sales to the segment . The main value of this exercise is to generate broad indicators towards which particular uses of the product could be targeted, since relative effectiveness is hard to quantify

    . How good is brand A compared to brand B, rate from 1-5. Please rate the following brands dividing 10 points among them . Requires customers to indicate which of a pair of products they prefer and by how much – in terms of Rs . Customer ratings of products described in terms of attributes including price and brand name; through this analysis, regression analysis, the relative importance of the attributes, as well as the values of different levels of these attributes, are determined

    . These are fundamental aspects of marketing

    . Direct questioning – how important is …..? . Controlled settings – shopping malls, in-store, conference rooms . Individual records - scanner data, credit card purchases; such analysis often use regression analysis to predict sales as a function of mix elements or logit analysis – a type of regression – to assess the impact of mix elements on market share or individual choice probabilities . Assessing sensitivity to elements of the marketing mix is a large, ongoing task; output of this assessment has implications primarily for the tactical/programmatic elements of marketing – how much to spend on advertising

    . Quality helps to create and maintain a customer – basic principle of marketing . Long-term – single transaction – sale – is not the ultimate goal . Quality is ultimately measured in terms of customer satisfaction

    . Repeat – perhaps most important

    . Hence, measures of intended or actual repeat purchasing provide a useful way to simultaneously measure satisfaction and its impact . Intentions are an imprecise predictors of future purchase and a staple input to sales forecasts

    . Mass customization – one-to-one marketing – Levis custom tailored jeans for women; Dell – customer configured PCs by direct marketing, Internet – businesses offer customization . Segmentation is a compromise between treating each customer as unique and assuming all customers are the same – mass marketing . Provides insights about different kinds of customer behavior and make marketing programs more efficient

    . Segments must be of sufficient size in terms of potential sales . Identity provides an aid to strategic and tactical decisions, name rather than Segment A. For purposes of planning the marketing mix, e.g. advertising, it is useful to be able to target efforts on a segment; sports-minded segments can be reached by specific media – sports magazine, sports games on TV . Segments should respond differently to at least some of the elements of the offering; if all the segments respond the same, then there is no segmentation – some customers may be sensitive to price and unaffected by advertising, others may be unconcerned about the price but may be sensitive to ads; this forms a useful basis for both describing the overall market and defining the segment . It is assumed that all members of the segment are homogeneous – but actually not true; however, it is important that the average member be reasonably close to the rest of the members; within- segment variation in behavior is small compared to between-segment variation . Fairly stable over time since future plans are based on past data

    . Product manager has customer data form surveys or other sources measuring both descriptive information and information about behavior towards the product; customer – former, potential, current

    . Each cluster, a, b, c represents a combination of factors – age and purchase quantity; a product manager can conclude form this analysis that the young customers purchase the most, the oldest second most, and the middle-aged the least . Cluster analysis programs are widely available in commercial computer software packages such as SAS and SPSS, however, such clear clusters rarely emerge

    . Company collected information on descriptors, attitudes, and behavior – as usage measured in $

    . Do not consider the product important . Loyal to supplier . The product is important. Bargain for both price and service

    . Chi-square test to determine statistically significant relationship the independent variable – attitude and the dependent variable – usage quantity is used; and SAS; results presented in the form of a table . Also called cross-tabular analysis

    . The broadest and most abstract of external factors that influence consumer behavior. Culture is the complexity of learned meanings, values, norms, and customs shared by members of a society .Cultural norms offer direction and guidance to members of a society in all aspects of their lives, including their consumption behavior . Increasingly important in international marketing efforts . Sub-culture – within a given culture, smaller groups or segments whose beliefs, values, norms, and patterns of behavior set them apart from mainstream Sub-cultures many be based on age, geography, religious, racial and/or ethnic differences . Social Class – societies exhibit stratification, individuals assigned to a special social category on the basis of criteria important to members of that society, refers to relative homogeneous divisions, people sharing similar lifestyles, values, norms, interests, and behavior can be grouped. Class structures can be based on occupational status, educational attainment, and income . Sociologists – in US, 3 broad levels, upper (14%), middle (70%), lower (16%) Important to marketers – in each class, similar values, lifestyles, buying behavior Social Class groups provide a natural basis for market segmentation . A Reference Group is a group whose presumed perspectives or values are being used by an individual as the basis for his or her judgments, opinions, and actions . A guide to individual behavior even when the group is not present – party group, classmates, family, and co-workers, or a group to which an individual aspires . Situational Determinants – specific situations in which a consumers plan to use the product or brand which directly affects their perceptions, preferences, and purchasing behaviors . 3 situations – the specific usage situation (private, public, commercial), the purchase situation (environment at the time of purchase, and the communication situation (condition in which an advertising exposure occurs, TV, car radio, friends)

    . Which need would you place Development in ?. Accomplishment, respect. Affection. Safety. Clothing. Abraham Maslow, 1948

    . Attainment of a more positive situation, when a consumer has a felt-need it creates a want. To make a purchase decision, internal – routine purchase base on memory, external – personal sources (friends, coworkers, relatives, etc.), commercial sources (ad, point-of-sale, Internet, etc), public sources (newspapers, magazines, news on TV, etc.), personal experience (examining, handling, testing a product). Comparison of various brands or products and services. Making the purchase based on intention to purchase or predisposition to buy a certain brand. How the consume feels about the purchase after using it for a little while, evaluates performance, is satisfied or dissatisfied

    . Motivation to solve the problem – then need or want. Process of how the consumer receives, selects, organizes, and interprets information to create a meaning, perceptions can be subliminal – unconsciously aware. Attitudes are learned predispositions towards anything – issues, products, services – overall feelings towards and evaluation of the situation - . The way knowledge, meaning, and beliefs are combined to evaluate two or more alternatives . The process by which the knowledge gained and experience obtained is applied to future related decisions

    . The purchase decisions are such that for many products fewer than 50% of consumers are loyal to one brand

    . Quantity demand varies with price – the product manager would like to know what is the effective demand for the product at any given price . May b thought of as that part of the total market or effective demand for an existing product which a firm might anticipate securing through the introduction of a new competitive product . Related to available disposable income, lack of availability reflects marketing opportunity for a product manager

    . Simple demand curve, for an undifferentiated product

    . Out of these assumptions only 2 and 3 seem likely to be true with any frequency in the real world. Consumer demand is fickle and changes frequently . Total knowledge may be possible about prices or many not . May spend money as resource permit and desired . Consumer will try to maximize satisfaction – objectively and subjectively (which is not rational)

    . Demand is direct – consumption by individuals or derived – when crating final consumption goods . Effective demand is related to the population, can be forecasted with forecast in population . For latent demand to become effective, other factors come into play, less easy to predict; Maslow’s hierarchy of Human Needs – basic understanding of tastes; Engels laws – guidance on how . Needs – transportation, energy, entertainments; specific wants – cars, solar power, satellite TV . The remaining factors which influence demand – price, distribution, stocks – really have more to do with achieving some kind if equilibrium between demand and supply than in shaping long-term demand changes people’s expenditure will change as their income rises

    . Product modification – can occur not just in the physical product but in any aspect of the offering – changing distribution channels, lowering the price, changing the ad focus, changing the service experience – an ordinary flower becomes special when it is delivered personally door-to-door

    . New Coke – loyal coke buyers did not even try it . It is possible that though the original concept is faulty, a better one is found through the concept tests; it would reenter the development process at the screening stage - 4. Ideas generated have to be managed – 1. Ideas screened turn into a more clearly specified concept – 2 . Initial assessment of the extent of demand for the idea – 3 . Prototypes are physically made – 5 . Tested with potential customers to assess the overall impression of the test product – 6 . Penultimate stage in the development cycle – small-scale tests with customers in the market, the real world – 7 . Last stage - commercialization stage – very costly – decisions when to launch, where to launch, how and to whom to launch have to be made – 8

    . The usefulness of the process models, such as the BAH, lies in the way in which they provide an indication of the magnitude of the project required in order to develop and launch a new product . For a slightly, versus, new, versus really new product the complexity, risk and uncertainty, and the budget will increase . A roadmap is used by the best performers, about 40%, more often than the worst, about 20% . A product manager will walk the path of the model which will be different from firm to firm

    . The sources of information for this stage are both internal and external, incorporating any market or technical research carried out thus far . The output of this stage will be a development plan with budget and an initial marketing plan

    . These decisions are based on information collected throughout the development process

    . Launch strategy – ad, trade promotions, sales promotions, sales training

    . How many different Honda Civics should there be to capitalize on the original brand’s equity; Toyota introduced Lexus to sell a luxury-prices Toyota

    . How many different Honda Civics should there be to capitalize on the original brand’s equity; Toyota introduced Lexus to sell a luxury-prices Toyota

    . Companies maintain facilities where customers are less obtrusively observed using company products; Sony – Michigan Ave in Chicago, Whirlpool – at its HQ . RC Cola first introduced diet cola – not Coke or Pepsi

    . Non-rep customers – customers in a different market segment or purchasing a different category of products . The style is different – new products – emphasis is fixing or improving existing products; for really new – taking an outsider’s view, doing things differently, disrupting current behavior, and using different or new technologies, process reengineering, discovery by scientists and engineers

    . Surveys – large samples can be obtained . Focus – as predictors of actual sales, they are fairly inaccurate due to their small size . Demo – ask questions after the ‘story’

    . Eliminate serious problems . Customers given products to use . May last for two months – advantage is that the results allow both for the initial expectations to wear out and for problems thatmanifestthemdelves only over time to develop

    . This precludes test marketing products with high initial fixed cost or investment requirements – in this case a prototype is tested in collaboration with a potential customer, especially for industrial products . Projections are typically made for both share and actual sales, approximately adjusted to national levels

    . This precludes test marketing products with high initial fixed cost or investment requirements – in this case a prototype is tested in collaboration with a potential customer, especially for industrial products . Projections are typically made for both share and actual sales, approximately adjusted to national levels

    . Standards for evaluating the tests should be set up in advance, including when to stop the test, continue the test, revamp the product, go national . Is a serious problem – for consumer products tests are done in 2 to 3 cities, areas that are self-contained in terms of media are preferred; basis is representing market segment, ability to gain distribution channels and media exposure, availability of good research suppliers . Effort should be to simulate a national or regional launch – in terms of dist. Channels, trade discounts, price breaks to the customer . Not easily answered – cost consideration, competitor counter is quick if long . Ad and promotions account for 65-75 % of the test marketing budget . A variety of information is gathered – 1) actual sales – typically from 40 stores, plus dist., promotion; 2) surveys that measure awareness, attitude; 3) panels that report actual purchase and allow monitoring of trial and repeat rates

    . Silk and Urban’s (1978) – assessor – currently the most prominent – uses a simulated shopping trip following ad exposure and an in-home use period, bases. Blackburn and Clancy’s (1980) – litmus – uses pretest market data plus a large database of past new products to calibrate the results; movement from awareness to trial and trial to repeat is estimated based on a laboratory experiment . Less expensive but less reliable than actual market test

    . All stages of the process are to be managed . To combine technical and marketing expertise a number of company functions have to be involved : R&D, manufacturing, engineering, marketing, sales . Technical and market information provided to the development team appropriately and timely . Quick enough to capitalize on new product opportunity before the competitors do . Facilitates efficiency and cooperation . So people stay focused

    . In other words, the structures, culture, and even strategies of Sony have remained locked to the formulae of the successes of the 1970s – 1980s, rather than moving on to understand what the changing market and technologies demand for the 21st-century innovative organization

    . It can be a name, trademark, logo, or other symbol . Under trademark law the seller is granted exclusive rights to the use of the brand name in perpetuity . Brand is an asset, like other assets like patents and copyrights . Like a patent, brand does not expire

    . One of the most important function a company does is market its products or services . If not a marketing-oriented company, a company ought to be a market oriented company . Everything starts with the market, the consumer, especially for consumer oriented products . The reason for innovation comes from the market . Focusing on product innovation and quality is a great way for a brand to start, or extend the PLC . Focus on brand identity – Nike brand – to represent sports and fitness activities, misjudged the aerobics market to Reebok, outgrew its own capacity to manage at the $1B revenue mark, and made a disastrous move into casual shoes . Nike created a whole new segment within – basketball shoes – Air Jordan, still requires performance which is Nike’s core competency with the running shoes, further Nike created two segments in the basketball segment – Force – for an aggressive and muscular player and Flight – for a more flexible, quick, high-flying style, and light weight player . Create a new umbrella of products by acquiring like Nike did – Cole-Hann, a maker of dress shoes, the Nike name is not involved, save time to create the product and ad expense by acquiring a company with growth potential in the market . Emotional ties with the customer, long-term relationship, loyalty

    . 6 levels of meaning that can be used for positioning – brand can have a deep meaning or a shallow meaning . Japanese corporate culture of quality . Hero Honda – motorcycles, swift and agile like a cheetah . The 4 p’s of marketing lend themselves to brand positioning . Brand Personality – consumers may select brands due to congruity between their self-image and the brand’s personality, this self-definition rational would be stronger in some product categories than in others . Consumers are more likely invest their sense of self in product categories such as cars and clothing than in paper towels . Image congruency is specially important in those situations in which the product is socially conspicuous, our sense of self is supposed to grow due to reactions of others important to us . Psychologists call people who are constantly modifying their own personalities to appear more likeable to others high self-monitors – are more sensitive to imagery ad appeals than are low self-monitors . Endorsers and celebrities (user imagery), execution elements (media), symbols (McDonald’s golden arches, Merrill Lynch’s bull, Prudential’s rock), consistency (over time), and marketing elements (pricing, promotions, distribution, and line extensions are important to create brand personality associations and to to support and reinforce a brands basic personality

    . The challenge for a brand manager is to deeply anchor the brand identity

    . CDI of 100 or less suggests that the category potential is low . BDI of greater than 100 suggests that the brand potential is good relative to other brands . One can determine what media weight (quantity of ad) to apply to the product category and the brand in terms of the advertising budget to gain additional market share

    . CDI of 100 or less suggests that the category potential is low . BDI of greater than 100 suggests that the brand potential is good relative to other brands . One can determine what media weight (quantity of ad) to apply to the product category and the brand in terms of the advertising budget to gain additional market share

    . Emotional Bonding. How consumers think about brands in respect to product benefits, through a rational learning process, can be measured, consumers are not very loyal and brand switching is common. A brand may be thought of as self-assured, aggressive, adventurous, as opposed to compliant and timid, the consumer’s judgment of the brand has moved beyond its attributes or delivery of product/service benefits, consumer judges the personality of a brand on the basis of an assessment of overt or covert cues found in its advertising . Master Card – priceless, L’Oreal – I am worth it . Reminder Advertising can be in any type – rational, emotional, rational and emotional

    . Difficult to find a major selling idea . Image advertising – major selling idea – soft drinks, beer, cars, airlines, financial services, perfumes/colognes, clothing

    . There is reduced risk associated with a familiar brand for the customer . Overall quality, specific product attributes, user characteristics – young, hip – impact the reaction to a brand . Inclusion in the consideration set is a critical part of brand equity – willingness to consider buying the brand, similar to being on an approved supplier list in B2B marketing . Is the strongest type of brand equity and the most beneficial for sellers; may pass from one generation to the next . Advocacy the strongest fans of a brand become advocates, word of mouth, encouraging channels to stock the brand

    . If sales are constant with increase in price - is generally of greater value than one for which demand slumps . Difficult to track compared to directly spoken and written comments

    .New-products – indicate that the total gap between customer value and company costs is sufficiently large to allow for profits even when more companies divide the market

    . 2008 – source Interbrand Corp., $ figures rounded . 1994 – Coca-Cola brand value was 35 $B, doubled in 10 years, reason the brand equity is high is its efficient worldwide distribution, the company says that it wants to be an ‘within an arm’s reach of desire’

    . Rank 21, Samsung, $18B. Rank 25, Sony, $13B . Rank 26, Pepsi, $13B . Rank 57, Colgate, $6B . Rank 100 Visa, $3B

    . Coke brands in India

    . David A Aaker, Managing Brand Equity, a brand can have high equity or value as a tradable asset for many reasons: high awareness, many loyal customers, a high reputation for perceived quality, proprietary brand assets such as access to scarce distribution channels or to patents, or brand association such as personality associations . The equity is captured in the name and symbol of the brand

    . Positioning by:. Using product characteristics or customer benefits – Colgate – cavity fighter . Price and quality – Hipercity is a value store . Use or application - DeCold is for cough and fever . Product user – Maruti is for the common man . Product class – 7-Up is a soft drink like the colas, but not a cola or a mixer . Cultural symbols – IPL cricket league . Competitor - Pepsi positions itself against Coke . Identifying the competitor – not as simple as it might seem . Pepsi might define its competitors as follows: 1) other cola drinks 2) non- diet soft drinks 3) all soft drinks 4) non-alcoholic beverages 5) all beverages except water, may be even including water

    . Other pain relievers – Balms for headaches, Tiger . Postal Services, other couriers . Dettol – antiseptic but stings, children (major customers) don’t like it . Mercedes – offering mostly luxury in 1974, BMW has sold bullet proof sedans for the Indian Govt.

    . Two Dimensional Map . Any two attributes or dimensions can be looked at. For example – brands of cars – a map may be created based on quality and performance . Another two attributes may be – safety and performance . A – market leader . F – firms product, car, it may have high quality and high performance but may be less than the market leader A, or the quality may be better but not performance, or performance may be better but not the quality, the firm must objectively determine this before positioning the product . One can have low performance and high quality if the product is launched but not ready for the market . One can have low quality and low performance if the product is not formulate or designed well and the materials or components and finish are not of high quality . One can have low quality and high performance if the components are substandard but the technology is new, innovative, and leading-edge

    . The basic tools of the marketing-mix are the same in rural and urban markets, but the rural challenges are unique . HL – the first multinational to enter the rural market – Lifebuoy 50g, Rs 2 . Coca-Cola – returnable 200ml glass bottle, Rs 5, 80% of new customers from rural; Sunfill – powdered soft-drink concentrate, instant ready-to-mix single-serve sachet 25g, Rs 2 . Videocon – washing machine, Rs 3,000 . Godrej – Cinthol, Fair Glow and Godrej soap, 50g, Rs 5

    . Mkt. mix – 4Ps and 4Cs. IMC promotional mix – broader perspective. Advertising means paid and non-personal (mass media). Sales promo. – consumer-oriented includes couponing, sampling, rebates, contests, sweepstakes, point-of-sale materials – trade-oriented targets intermediaries such as wholesalers, distributors, and retailer and includes promotional and merchandising allowances, price deals, sales contests, and trade shows to encourage trade to stock and promote company’s products. Publicity refers to non-personal communications regarding an organization, product, service, or ides not directly paid for or run under identified sponsorship and includes new story, editorial, or announcement about company, products, services. Attempts media to cover or run a favorable story to affect awareness, knowledge, opinions, and/or behavior. Techniques used to gain publicity include news releases, press conferences, feature articles, photographs, films, and videos. Pub. Relations is defined as the management function which evaluates public attitudes, identifies the policies and procedures of an individual or organization with the public interest, and executes a program of action to earn public understanding and acceptance, tools include special publications, participation in community activities, fund-raising, sponsorship fo special events, and various public affairs activities, als advertising as a PR tool. A form of person-to-person communication in which a seller attempts to assist and/or persuade prospective buyers to purchase the company’s product or service or to act on an idea Direct contact between buyer and seller, face-to-face or telecommunications. DM not traditionally considered part of the mix But had become important and involves separate objectives, budgets, and strategies Direct mail and mail-order catalogs, database management, direst selling, telemarketing, direct response ads through direct mail, the Internet, various broadcast and print media – Amway, Tupperware, L.L. Bean, Dell. Internet – is interactive, real time exchange – other than www interactive includes CD-ROMs, kiosks, interactive TV

    . The advertising manager is responsible for all promotions activities except sales . In some companies the ad manager has the title of Marketing Communications Manager

    Brand managers may choose different ad agencies.Ad Dept. would be involved in sales promo, package design, and merchandizing.Brand managers will work directly with the Ad Dept.P&G, Gillette Co., Nestle assign each product ot brand to a brand manager.

    . Different brand managers many have their own ad agency . Tide and ERA, P&G, compete with each other for a share of the laundry detergent market – why? . The ad dept. is part of marketing services and supports the brand manager . P&G – decentralized system, generally referred to as a Category Management System, includes category managers, brand managers, and ad managers . Category manager oversees the entire product category . The ad manager many, advise and consult with the brand manager, and may have the authority to override the brand managers decision on advertising . Advantage – each brand receives concentrated managerial attention, resulting in faster response to both threats and opportunities, flexible system – easier to adjust various aspects of the ad and promotional program, such as creative platforms and media and sales promotion schedules . GM uses the brand manager system – 40-plus models or cars, trucks, minivans, and sports utility vehicles, brand manager is responsible for marketing the brand, identifying the target market, developing integrated communications programs that will differentiate the brand . Disadvantages – brand managers lack training and experience, may develop short-term programs, may not understand the advertising aspect or sales promotion, competing for top management attention and resources, potential rivalry and misallocation of funds . For this reason P&G switched to category management system – ad and sales promotion decision making involves the ad and/or sales promotion manager, the brand manager, and the marketing director

    . Tools used by Foster’s included billboards, videos, point-of-sale promotions, TV spots. DAGMAR objectives must be measurable like Midwest Airline asked passengers if their airfares were higher than those of compet

    . Any of these can spark a major selling idea . Pennzoil and Quaker State merger – the company now creates separate ads, Pennzoil positioned for protection – we’re driving protection; Quaker State for performance – stay tuned . The USP, brand image, inherent-drama, and positioning approaches are often used as the basis of the creative strategy for ad campaigns . Today’s creative kings don’t write books, rarely give interviews, or lay out their theories on advertising, they’ve endorsed no set of rules, professed no simple maxims, what’s replaced them is a conscious desire to lift the intelligence level of advertising, today’s leaders see advertising as an uplifting social force, as a way to inspire and entertain. Advertising works best when it speaks into people’s lives, when it doesn’t look or feel like advertising, treating people best, not common denominator to make money, that at the same time has a sales pitch, understand the sociocultural realities of people and how they interact with the media, messages that connect with people or that people can connect with . If the major selling idea is some other approach – use it as a guide in developing an effective creative strategy

    . Selected by Advertising Age. Ad campaign plans are short-term, like IMC is annual. Campaign themes – usually intention of being used for a longer time, unfortunately last for a short time ineffective or market conditions and/or competitive developments in the marketplace change . Some marketers change theme often, a successful theme may last for years . Philip Morris – Marlboro country – 40 years. General Mills – Breakfast of Champions – decades. BMW – Ultimate driving machine – since 1774, changed agencies several times in the past 3 decades, the classic tag line has been retained

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    Product & Brand Management - Presentation Transcript

    1. Product & Brand Management(50)
      Dr. A. Kaul
    2. Syllabus
      Introduction to Product Management
      Role and Operation of Product Management in Marketing
      Product Analysis: Category/Competition/Customer/Demand
      New Product Development – Process and Role of Product Manager
      Brand vs. Product, Brand Elements
      Dr. A. Kaul
      Take Notes
    3. Brand Extension/Brand Relationships Spectrum
      Brand Identity
      Brand Equity
      Brand Building Strategies
      Syllabus
      Dr. A. Kaul
      Take Notes
    4. Reference Texts
      Product Management – Lehmann
      Strategic Brand Management – David Aaker
      Strategic Brand Management – Noel Kapferer
      Building Strong Brands - Keller
      Dr. A. Kaul
      Take Notes
    5. Introduction to ProductManagement
      What is a Product?
      A product is anything that can be offered to a market to satisfy a want or a need
      What is Management?
      Management is coordination of the resources of the firm to produce goods and services
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      Dr. A. Kaul
    6. What type of Products are Marketed?
      Physical Goods – Cars, Shampoos
      Services – Financial, Repair
      Persons – Movie Stars, Political Leaders
      Places – Switzerland, Nanital
      Organizations – Girl Scouts, Political Parties
      Ideas – Family Planning, Driving in Single Lanes
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      Dr. A. Kaul
    7. Product Classification
      Products are classified into 3 groups according to their durability and tangibility
      Non-Durable – Few uses – soaps, salt
      Durable – Many uses – clothing, cooking range
      Services – Intangibles – banking, brokerage
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      Dr. A. Kaul
    8. Consumer Goods
      Convenience Goods
      Frequently used, purchased with minimum effort – bread, cooking oil
      Shopping Goods
      Purchased less often, comparison on price, quality, and style – TV, Mobile Phone
      1
      Dr. A. Kaul
    9. Specialty Goods
      Purchased as desired, branded products –
      anti-aging cream, shampoos
      Unsought Goods
      Purchased on perceived need, can do without – food processor, water filter
      1
      Consumer Goods
      Dr. A. Kaul
    10. FMCG
      Fast Moving Consumer Goods (FMCG)
      Groceries
      Snacks
      Detergent
      Hair Oil
      1
      Dr. A. Kaul
    11. Industrial Goods
      Capital Goods
      Plant Equipment, Computers
      Materials and Parts
      Plastics, Auto Parts
      Supplies
      Paper, Toner
      Business Services
      Market Research, Patent Services
      1
      Dr. A. Kaul
    12. Product-FocusedOrganization
      1
      Head of
      Company/
      Division
      Manufacturing
      Marketing
      Finance
      Corporate
      Communications
      Product
      Management
      Marketing
      Research
      Support
      Manager
      Product B
      Manager
      Product A
      Manager
      Product C
      Dr. A. Kaul
    13. Characteristics
      Classic brand management structure developed by P&G in 1930s
      Commonly used where different products use the same channels of distribution
      Product Manager acts as a ‘Mini-CEO’
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      Dr. A. Kaul
    14. Product Manager has the ultimate responsibility for the brand
      Associate Product Manager develops brand extensions or manages a small brand
      Assistant Product Manager is responsible for market and share forecasting, budgeting, coordinating with production, executing promotions, and packaging
      1
      Characteristics
      Dr. A. Kaul
    15. Advantages
      Center of responsibility is clear
      Clear who to turn to for information on the product
      Product has an advocate with training, experience, persuasion, and communication skills
      Breeding ground for senior executives
      1
      Dr. A. Kaul
    16. Disadvantages
      Narrow focus on one product
      Induces a centralized structure
      Quest for quarterly or short-term sales and market share goals
      Several salespeople representing different products calling on the same customer
      Inefficient use of marketing funds to build brand name
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      Dr. A. Kaul
    17. Examples
      P&G
      General Foods
      Adobe
      Ford
      Mitsubishi
      GM (adopted – 1995, dropped – 2002)
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      Dr. A. Kaul
    18. Market-FocusedOrganization
      1
      Head of
      Company/
      Division
      Manufacturing
      Marketing
      Finance
      Corporate
      Communications
      Manager
      Market B
      Manager
      Market A
      Manager
      Market C
      Dr. A. Kaul
    19. Characteristics
      Marketing authority by market segment
      Useful when there are significant differences in buyer behavior in the market segments
      Does not give managers full responsibility for the services or products delivered
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      Dr. A. Kaul
    20. Advantages
      Focus on the customer as an asset
      Easier to justify product modification or elimination
      Useful when bundling different products or when consumer purchases many different products form the same company
      Enhances product manager interactions due to specific knowledge in the particular segment
      1
      Dr. A. Kaul
    21. Disadvantages
      Possible conflict with the product management structure that may lie below
      ‘Mini-CEO’ training and experience of traditional product managers may be lost
      Most product management skills need to be
      sustained
      1
      Dr. A. Kaul
    22. Examples
      Levi
      Bell
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      Dr. A. Kaul
    23. Function-FocusedOrganization
      1
      Head of
      Company/
      Division
      Manufacturing
      Marketing
      Finance
      Corporate
      Communications
      Advertising
      Product
      Planning
      Sales
      Promotion
      Marketing
      Research
      Dr. A. Kaul
    24. Characteristics
      Aligned by marketing functions
      Product and market-focused organizations have aspect of this structure embedded in their organizations
      A single manager is not responsible for day-to-day marketing activities of the product
      Marketing strategies are designed and implemented through coordinated efforts
      1
      Dr. A. Kaul
    25. Advantages
      Administratively simple
      Useful if company has few products
      The structure is logical with normal marketing activities
      Functional training is easier to deliver
      Managers become functional experts
      1
      Dr. A. Kaul
    26. Disadvantages
      Product responsibility is shared so no one down the line can be held accountable
      Requires substantial time in cross-functional meetings
      Training is limited to function
      Marketing VP or head needs to do much of the planning
      1
      Dr. A. Kaul
    27. Examples
      Intel
      Apple
      HP
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      Dr. A. Kaul
    28. Dr. A. Kaul
    29. Role and Operation of Product Management in Marketing
      2
      Dr. A. Kaul
    30. Factors InfluencingCompetitive Success
      2
      Environmental Factors
      Rate of Technology Change
      Nature of Competition
      Intensity of Competition
      Organizational Factors
      Size
      Structure
      Culture
      Manufacturing Capability
      Strategic Factors
      Long-term Objectives
      Strategic Time Horizon
      Product-Market Strategy
      Managerial Factors
      Leadership Style
      Communication
      Attitude
      Marketing Factors
      Product Quality
      Customer Service
      Market Research
      Product or
      Business Performance
      Dr. A. Kaul
    31. Changes Affecting Product Management
      The Web
      IS Database Management
      Increased Emphasis on Brands
      Shift in Balance of Channel Power
      Increased Importance of Customer Retention
      Increased Global Competition
      2
      Dr. A. Kaul
    32. Potential Interactions of aProduct Manager
      2
      Advertising
      Agency
      Publicity
      Media
      Legal
      Promotion
      Services
      Fiscal
      Product Manager
      Packaging
      Research
      and
      Dev.
      Purchasing
      Manuf. and
      Distrib.
      Market
      Research
      Sales
      Dr. A. Kaul
    33. Three Levels of a Product
      2
      Augmented
      Product
      Warranty
      Tangible
      Product
      Brand
      Name
      Core
      Product
      Core
      Benefit or Service
      Delivery
      And
      Credit
      After-Sales
      Service
      Features
      Packaging
      Quality
      Styling
      Installation
      Dr. A. Kaul
    34. Dr. A. Kaul
    35. Product Analysis
      Category
      Competitor
      Customer
      Demand
      3
      Dr. A. Kaul
    36. 1. Category AttractivenessAnalysis
      Aggregate Category Factors
      Category Factors
      Environmental Factors
      3
      Dr. A. Kaul
    37. Aggregate Category Factors
      Category Size
      Category Growth
      Stage in the PLC
      Sales Cyclicity
      Seasonality
      Profits
      3
      Dr. A. Kaul
    38. Category Size
      Measured in units and monetary value
      Will revenues support investment?
      Large markets are better
      Large categories offer more opportunities for segmentation
      Large size tends to draw competitors
      3
      Aggregate Category Factors
      Dr. A. Kaul
    39. Category Growth
      Current growth are important
      Growth projections are crucial
      Fast-growing support high margins and sustain future profits
      Attract competitors
      Cause dramatic shift in market share
      survivability of product
      3
      Aggregate Category Factors
      Dr. A. Kaul
    40. Stage in the PLC
      The introduction stage is unattractive for new entrants
      The growth stage is attractive
      The maturity stage may be attractive for
      some categories
      The decline is unattractive to new entrants and low market share holders may exit
      3
      Aggregate Category Factors
      Dr. A. Kaul
    41. Category Attractivenessover the PLC
      Sales
      Stage Intro. Growth Maturity Decline Years
      Size Small Moderate Large Moderate
      Growth Low High Low Negative
      Attract - Low High Low/ Low
      ivenes High
      3
      Aggregate Category Factors
      Dr. A. Kaul
    42. Sales Cyclicity
      Due to inter-year variation in demand
      General Economic conditions introduce peaks and valleys in sales as GDP varies
      Swing in sales, profits, employment, cash available for new product development
      3
      Aggregate Category Factors
      Dr. A. Kaul
    43. Seasonality
      Intra-year cycles in sales
      Clothes, sweets, fire-crackers, and toy sales during festivals
      Generates price wars
      Many products are seasonal like cold remedies, skin creams, ice cream
      3
      Aggregate Category Factors
      Dr. A. Kaul
    44. Profits
      Vary across products or brands in a category, and over time
      Inter-industry differences also exist
      Average profit margins for footwear is about 6%, personal care 20%, and biotechnology 50%
      Chronic low profitability is less attractive
      Variation used as industry risk
      3
      Aggregate Category Factors
      Dr. A. Kaul
    45. Attractiveness of MarketFactors
      Attractiveness
      Factor High Low
      Category Size + -
      Category Growth + -
      Sales Cyclicity - +
      Seasonality - +
      Profit + -
      Profit Variability - +
      3
      Aggregate Category Factors
      Dr. A. Kaul
    46. Category Factors
      Threat of New Entrants
      Bargaining Power of Buyers
      Bargaining Power of Suppliers
      Amount of Intra-category Rivalry
      Threat of Substitute Products or Services
      Category Capacity
      3
      Dr. A. Kaul
    47. Threat of New Entrants
      If high, attractiveness diminishes
      In early stages of market development it can help a market to expand
      Usually it heightens competitiveness and reduces profit margins
      Offset by setting up barriers to entry
      3
      Category Factors
      Dr. A. Kaul
    48. Potential Barriers to Entry
      Economies of Scale
      Product Differentiation
      Capital Requirements
      Switching Costs
      Distribution
      3
      Category Factors
      Dr. A. Kaul
    49. Bargaining Power of Buyers
      Distributors, original equipment manufacturers (OEMs) or end users
      High if – product bought is a large % of buyer’s cost, product is undifferentiated, buyers earn low profits, buyer can backward integrate, buyer has full information, when substitutes exist
      3
      Category Factors
      Dr. A. Kaul
    50. Bargaining Power of Suppliers
      Is a mirror image of buyer power
      High if – suppliers are concentrated, no substitutes, differentiated product, built in switching costs, supply is limited
      3
      Category Factors
      Dr. A. Kaul
    51. Amount of Intra-category Rivalry
      Intense category competition is not attractive
      Escalates marketing expenditures, price,
      employee switch
      High if – many or balanced competitors, slow growth, high fixed costs, lack of differentiation, personal rivalry
      Difficult for a product manager to have an impact on category rivalry
      3
      Category Factors
      Dr. A. Kaul
    52. Threat of Substitute Products or Services
      Large number is less attractive
      Threat from generics
      Threat generally in all categories
      High rates of returns when few
      3
      Category Factors
      Dr. A. Kaul
    53. Category Capacity
      Chronic overcapacity is not a positive sign for long-term profitability
      Operating at capacity – costs stay low, supplier bargaining power high
      Indicates health of category
      Recession may lead to overcapacity
      3
      Category Factors
      Dr. A. Kaul
    54. Porter’s Five Forces Model
      3
      Category Factors
      Bargaining Power of Supplier
      Threat of Substitute Products or Services
      Threat of New Entrants – Barriers to Entry
      Amount of Intra-Category Rivalry
      Bargaining Power of Buyer
      Dr. A. Kaul
    55. Attractiveness of CategoryFactors
      Attractiveness
      Factor High Low
      Threat of New Entrants - +
      Bargaining Power of Buyers - +
      Bargaining Power of Suppliers - +
      Amount of Intra-Category Rivalry - +
      Threat of Substitute Products or - +
      Services
      Unused Capacity - +
      3
      Category Factors
      Dr. A. Kaul
    56. Environmental Factors
      Technological
      Political
      Economic
      Regulatory
      Social
      3
      Dr. A. Kaul
    57. Technology
      If weak – vulnerable to new product and global competition
      If well positioned – firm can take advantage of change
      3
      Environmental Factors
      Dr. A. Kaul
    58. Political
      Affects products with global sales
      Product manager must assess political risk
      Free market – affected by political party in power
      3
      Environmental Factors
      Dr. A. Kaul
    59. Economic
      Interest rate fluctuations – short-term financing
      Currency exchange rates – global markets
      Employment conditions – availability of skilled labor
      Recession – sales, GDP growth declines
      Inflation rates – consumer buying power diminishes
      3
      Environmental Factors
      Dr. A. Kaul
    60. Regulatory
      Restrict industry from specific media use
      Stringent testing requirements
      Air, water, soil pollution
      Intervene in global competition - dumping
      3
      Environmental Factors
      Dr. A. Kaul
    61. Social
      Trends in demographics, lifestyles, attitudes, and personal values
      Trends affect B2B due to derived demand
      Young adults
      Mature consumers
      Children as consumers
      Shift of power from seller to consumer
      3
      Environmental Factors
      Dr. A. Kaul
    62. 2. Competitor Analysis
      To analyze competitors, a commitment to developing a competitive strategy that includes a willingness to expend resources on collecting data is necessary
      3
      Dr. A. Kaul
    63. Determining the CompetitorSet
      From Commercial and Government Data
      Managerial Judgment – experience, internal sources
      Customer-Based Measures – behavioral data
      Customer Judgments - surveys
      3
      Dr. A. Kaul
    64. Using Customer Judgments
      Judged Overall Similarity – for a pair of products
      Similarity within Consideration Set – large set of products divided into groups in which each is a substitute for another
      3
      Dr. A. Kaul
    65. Product Deletion – in a group that are substitutes for each other, if one is deleted or not available, which one would the customer select from the choice set or the rest
      Substitution in Use – judged similarities in usage context, use and substitutes are indicated for the target product
      3
      Using Customer Judgments
      Dr. A. Kaul
    66. Defining Competitive Set with Perceptual Mapping
      3
      Formal Desert
      Moist
      Needs Refrigeration
      Long Time to Prepare
      Tea/Coffee Break
      Between Meal Snack
      Easy to Carry
      At School/Work
      Dr. A. Kaul
    67. Corporate Intelligence
      Rank US Company
      1 Microsoft
      2 Motorola
      3 IBM
      4 P&G
      5 GE, HP
      6 Coca-Cola, Intel
      3
      Dr. A. Kaul
    68. Competitor Analysis Steps
      Data Collection
      Data Analysis
      3
      Dr. A. Kaul
    69. Secondary Sources of Information
      3
      Data Collection
      Internal
      Sources
      Newspapers
      Customer
      Communications
      Annual
      Reports
      Consultants
      Patent
      Filings
      Trade
      Press
      Secondary
      Data
      Financial Audit
      Filings
      Promotional
      Literature
      Business
      Press
      Trade
      Associations
      Government
      Computer
      Databases
      News
      Releases
      Internet
      Dr. A. Kaul
    70. Primary Sources of Information
      3
      Data Collection
      Investment
      Bankers
      Consultants
      Sales
      Force
      Specialized
      Firms
      Primary
      Data
      Suppliers
      Employees
      Customers
      Dr. A. Kaul
    71. Other Sources of Information
      Classified Ads
      Trade Shows
      Plant Tours
      Reverse Engineering
      Monitoring test Markets
      Hiring Senior Employees
      3
      Data Collection
      Dr. A. Kaul
    72. Competitor Analysis Model
      3
      Data Analysis
      Primary Data
      Secondary Data
      Key Questions
      Who are they?
      What are the competing product features?
      What do they want?
      What is their current strategy?
      Differential Competitor Advantage Analysis
      Who has the competitive product advantage?
      Competitor Marketing Plan
      What are they going to do?
      Dr. A. Kaul
    73. Data Analysis Questions
      Who are the major competitors?
      How do the competing products or services stack up against each other?
      What are the objectives of the major competitor products?
      What is the current strategy being employed to achieve the objectives?
      Who has the competitive edge?
      What are they likely to do in the future?
      3
      Data Analysis
      Dr. A. Kaul
    74. Product Features/AttributeMatrix
      Competitor Features/Attributes
      Memory Price Processor
      A
      B
      C
      D
      3
      Dr. A. Kaul
    75. Assessing Competitors’ Current Objectives
      Is a critical first step in a competitor analysis for major competitor products
      Gives valuable information on intended aggressiveness of the competitors in the future
      Helps to assess the capabilities of the competitors
      3
      Dr. A. Kaul
    76. Define the Terms
      Growth Objective – increase unit sales or market share
      Hold Objective – brand losing market share, stop the slide
      Harvest Objective – profit is paramount relative to market share
      3
      Dr. A. Kaul
    77. Determining the Objectives
      Growth Objective
      Improve market share at the expense of short-term profits
      The following will occur:
      A cut in price
      Increase in advertising expenditures
      Increase in promotions to consumers and distributors
      Increase in distribution expenses
      3
      Dr. A. Kaul
    78. Harvest Objective
      Focus on profitability – brand marketed in the opposite way
      The following will occur:
      Increase in price
      Decrease in marketing budgets
      3
      Determining the Objectives
      Dr. A. Kaul
    79. Examples of Objectives
      Global Competitor
      May be interested in establishing market position even with short-term losses
      Private Firm on Stock Exchange – long-term profits
      Private Family Owned – short-term profits
      Public Firm– foreign exchange, employment, providing services
      3
      Dr. A. Kaul
    80. Mergers, Acquisitions, LBO
      Retain market share
      Firms Operating Philosophy
      Minimize capital investment
      3
      Dr. A. Kaul
    81. Assessing the Competitors’Current Strategies
      The important second step in competitor analysis is to determine how competitors are attempting to achieve their objectives
      Marketing Strategy
      Differential Advantage Analysis
      Competitor’s Will
      3
      Dr. A. Kaul
    82. Marketing Strategy
      Three Major Components:
      Target Market Selection
      Core Strategy
      Positioning, Differentiating
      Implementation
      Supporting Marketing Mix
      3
      Dr. A. Kaul
    83. Marketing Mix
      The mix provides insight into the basic strategy of the competitor and special tactical decisions
      4P’s
      3
      Dr. A. Kaul
    84. Product
      Physical product or service and how it is sold
      Price
      Highly visible
      Promotion
      Which type and how often
      Place
      Which channels are being emphasized?
      3
      Marketing Mix
      Dr. A. Kaul
    85. Tracking Competitors’Strategies
      Industrial Products
      Product sales literature
      The company’s own sales force
      Trade advertising
      Consumer Products
      Tracking Ads
      3
      Dr. A. Kaul
    86. Comparing Value Chains
      3
      Firms Infrastructure
      Support
      Activities
      M
      A
      R
      G
      I
      N
      Human Resources Management
      Technology Development
      Procurement
      Inbound
      Logistics
      Operations
      Outbound
      Logistics
      Marketing
      And Sales
      Service
      Primary
      Activities
      Dr. A. Kaul
    87. Technology Strategy
      Framework of Six Criteria
      Technology Specialization
      Level of Competence
      Sources of Capability – Internal/External
      R&D Investment Level
      Competitive Timing – Initiate/Respond
      R&D Organization and Policies
      3
      Dr. A. Kaul
    88. Product Entry Decisions
      Decision R&D Marketing Timing
      First State-of-the- Stimulating Early-entry
      To Market art Primary Demand in the PLC
      Second Advanced, Differentiating Entry Early in
      To Market Responsive the Product PLC Growth
      Next Ability in Market Entry During
      to Market Applications Segmentation PLC Growth
      Late Skill in Process Minimizing Selling Entry Late in
      To Market Development and Distribution PLC Growth
      Cost
      3
      Dr. A. Kaul
    89. Competitive Product AnalysisMatrix
      Marketing Competitor A Competitor B
      Mix Brand A Brand B
      Product 1 Product 2
      1. Product
      Targeted Segment
      2. Price
      3. Promotion
      Advertising
      4. Place
      5. Technology Strategy
      3
      Dr. A. Kaul
    90. Differential Advantage Analysis– Capabilities Matrix
      Ability To Firm/Product Own
      A B C Product
      Conceive/Design
      Produce
      Market
      Finance
      Manage
      3
      Dr. A. Kaul
    91. Differential Advantage Analysis– Success Matrix
      Critical Success Firm/Product Own
      Factors A B C Product
      1
      2
      3
      4
      5
      Overall Rating
      3
      Dr. A. Kaul
    92. Assessing A Competitor’sWill
      A strong competitor can be overcome
      A weak competitor can cause damage
      Assess:
      How crucial is this product to the firm?
      How visible is the commitment to the market?
      How aggressive are the managers?
      3
      Dr. A. Kaul
    93. Predicting Future Strategies
      Competitor signals with an announcement
      Use historical information to forecast:
      Competitor’s Strategy – dependent variable
      Capabilities and Resource – independent variable
      Extrapolate that the trend may continue
      Link Capabilities/Resources with Strategy
      Simulate by Role-Play
      3
      Dr. A. Kaul
    94. 3. Customer Analysis
      What we need to know about current and potential customers:
      1. Who – buys and uses the product?
      2. What – customers buy and how they use it?
      3. Where – customers buy?
      4. When – customers buy?
      5. How – customers choose?
      6. Why – customers prefer a product?
      7. How – customers respond to marketing programs?
      8. Will – customers buy it (again)?
      3
      Dr. A. Kaul
    95. Segmentation Variables for Consumer Markets
      Demographics
      Age, gender, geographic location
      Socio-graphics
      Income, education, occupation, social class
      Personality
      traits – ambitious, extrovert
      Psychographics and Value
      lifestyle – activities, interests, opinions
      3
      1. Who Buys and Uses?
      Dr. A. Kaul
    96. Lifestyle Topology
      Strivers
      Achievers
      Pressured
      Adapters
      Traditionalists
      3
      1. Who Buys and Uses?
      Dr. A. Kaul
    97. Value Topology
      Self-respect
      Security
      Warm relationship with others
      Sense of accomplishment
      Self-fulfillment
      Sense of belonging
      Respect for others
      Fun and enjoyment
      Excitement
      3
      1. Who Buys and Uses?
      Dr. A. Kaul
    98. Segmentation Variables forBusiness Markets
      Demographics
      Industry, company size, location
      Operating Variables
      Customer technology, use status, service
      Purchasing Approaches
      Structure, power, purchasing criteria
      Situational Factors
      Size of order, just-in-time delivery
      Personal Characteristics
      Attitude to risk, loyalty to supplier
      3
      1. Who Buys and Uses?
      Dr. A. Kaul
    99. Benefits
      The Firm Produces Features
      The Customer Purchases Benefits
      Technology Firms – User friendly
      Drill Manufacturer – Sells holes, not drills
      Product Manager – Understand the benefits customers are seeking in the market segment
      3
      2. What Customers Buy and Use?
      Dr. A. Kaul
    100. Distinction Between Featuresand Benefits - Cadillac
      Features Benefits
      300-HP Engine Ability to pull away safely
      Northstar Engine Smooth-running engine
      Adjustable Seats Stay fit, alert, comfortable
      ABS Brakes Wheels won’t lock and skid
      3
      2. What Customers Buy and Use?
      Dr. A. Kaul
    101. Purchase Pattern
      Database Marketers use three criteria for evaluating and segmenting customers in their databases
      Recency – how recently has the customer bought brand?
      Frequency – How many different products does the customer buy, and what are the time intervals?
      Monetary Value – What is the value of the customer’s purchases in terms of profits?
      3
      2. What Customers Buy and Use?
      Dr. A. Kaul
    102. Potential Customers
      Continuum Relating to the Product
      Unaware
      Aware
      Accepting – Willing to use the product
      Attracted – Positive towards the product
      Active – Buy and/or plan to buy
      Advocates - Encourage others to buy
      3
      2. What Customers Buy and Use?
      Dr. A. Kaul
    103. Product Assortment
      Different Brands Purchased by the Customers for the category in the Segments
      Create Switching Tables
      Different Vendors used by Businesses – Industrial products
      3
      2. What Customers Buy and Use?
      Dr. A. Kaul
    104. Use
      Sweets – Festivals
      Rainwear – Rainy season
      Sunscreen – Summer
      Customer Suggestions – Baking soda to deodorize drains
      – Lime juice to clean cooking range
      3
      2. What Customers Buy and Use?
      Dr. A. Kaul
    105. Channels of Distribution
      Customers Migrate to Other Channels
      Specialty retailer to Discount
      Discount to Department Store
      Neighborhood to Superstore
      Small Retailer to Large-Volume retailer
      Brick-and-Mortar to Internet
      3
      3. Where Customers Buy?
      Dr. A. Kaul
    106. Timing Issue
      Sales or Price Breaks and Rebates
      Fast-Food – Breakfast, lunch, snack, dinner
      Woolens – Winter
      Capital Equipment – Near fiscal year end
      Cold Remedies – Before and during winter
      3
      4. When Customers Buy?
      Dr. A. Kaul
    107. Customers CompareAlternatives
      Information
      Media Advertisements
      In-store personnel
      Word-of-Mouth
      Internet
      Decision Process
      Emotional
      Impulse
      Rational
      3
      5. How Customers Choose?
      Dr. A. Kaul
    108. Multi-attribute Model
      The process of how customers make decisions
      Attributes – used by customer to define the product
      Perceptions – amount of attributes possessed by each brand or product in the category
      Importance Weights – weights given by customer for each attribute
      3
      5. How Customers Choose?
      Dr. A. Kaul
    109. Attributes
      Identifying the relevant set is not easy
      Managerial judgment alone can cause misestimates
      Collect information:
      Focus-Groups
      Survey/Questionnaire – Open-ended or close-ended
      3
      5. How Customers Choose?
      Dr. A. Kaul
    110. Perceptual or PositioningMap – Bank
      Courteous Personnel
      F A
      D
      Inconvenient Convenient
      C B ATM
      Locations
      Un-courteous
      3
      5. How Customers Choose?
      Dr. A. Kaul
    111. Importance Weights
      Direct Questioning
      On a scale of 1-to-7 with 7 being very important and 1 not important, how important is ‘the attribute …..’ in your
      purchase decision
      3
      5. How Customers Choose?
      Dr. A. Kaul
    112. Decision Making by Manager for Each Brand
      Segment 1 Segment 2
      Attribute A Weight x Rating = Score
      Attribute B
      Attribute C
      Attribute D
      Segment Score ∑
      3
      5. How Customers Choose?
      Dr. A. Kaul
    113. Rules Available to the Product Manager
      Compensatory Rule – Multivariate Model
      All attributes are considered and weakness in one can be compensated for by strength in another
      3
      5. How Customers Choose?
      Dr. A. Kaul
    114. Lexicographic Rule
      Compares the products on the most important attributes alone and eliminates those which are not at the top
      3
      5. How Customers Choose?
      Dr. A. Kaul
    115. Conjunctive Rule
      Assumes the customer sets minimum cutoffs on each dimension and rejects a product if it has any attributes below the cutoff
      3
      5. How Customers Choose?
      Dr. A. Kaul
    116. Conjoint Analysis
      An alternative to weights, conjoint analysis permits the product manager to infer the importance of different product attributes in terms of importance
      3
      5. How Customers Choose?
      Dr. A. Kaul
    117. Conjoint Analysis – Laptops Computers
      Three Attributes
      Weight – 1 kg or 2 kg
      Battery Life – 2 hr or 4 hr
      Brand – HP or LG
      Task:
      Rank in order the following combinations from 1 = most preferred to 8 = least preferred
      3
      5. How Customers Choose?
      Dr. A. Kaul
    118. Customer Response – Laptop Computers
      Combination Rank
      1 kg, 2 hr, HP 4
      1 kg, 2 hr, LG 2
      1 kg, 4 hr, HP 3
      1 kg, 4 hr, LG 1
      2 kg, 2 hr, HP 8
      2 kg, 2 hr, LG 6
      2 kg, 4 hr, HP 7
      2 kg, 4 hr, LG 5
      3
      5. How Customers Choose?
      Dr. A. Kaul
    119. Analysis – Laptop Computers
      Preference
      1 kg, 4 hr, LG with rank 1 – most
      2 kg, 2 hr, HP with rank 8 – least
      Average Ranking:
      1 kg option = 2.5 = (1 + 2 + 3 + 4)/4
      2 kg option = 6.5 = (5 + 6 + 7 + 8)/4
      2 hr option = 5.0
      4 hr option = 4.0
      HP = 5.5
      LG = 3.5
      3
      5. How Customers Choose?
      Dr. A. Kaul
    120. Difference in the Average Ranks:
      Weight = 4.0 (6.5 – 2.5)
      Battery Life = 1.0 (5 – 4)
      Brand = 2.0 = (5.5 – 3.5)
      The most important attributes to this customer is weight, followed by brand, and then battery life
      3
      5. How Customers Choose?
      Dr. A. Kaul
    121. Customer as ProblemSolver
      Extensive Problem Solving – First-time buyers or high-technology products
      Limited Problem Solving – Customer understands functioning and competitors, evaluates on small number of attributes
      Routine Response Behavior – routine purchases with low or high price tag
      3
      5. How Customers Choose?
      Dr. A. Kaul
    122. Customer Value
      Critical Component of Customer Analysis
      Benefit – Customer’s perspective
      Cost – price, maintenance
      Sources of Customer Value
      Economic
      Functional
      Psychological
      3
      6. Why Customers Prefer a Product?
      Dr. A. Kaul
    123. Manifestation of Customer Value
      Price – firm’s assessment of the product’s value
      Price Sensitivity – sales change with price
      Satisfaction – Indicated in surveys used as standard practice
      Complaints and Compliments – Number
      Word-of-Mouth – Difficult to track
      3
      6. Why Customers Prefer a Product?
      Dr. A. Kaul
    124. Margin/Profit Contribution – Higher margins
      Sales – Value assessed by the market
      Competitive Activity – New-product introductions
      Repeat Purchase Rate – High loyalty indicates high brand value
      3
      6. Why Customers Prefer a Product?
      Dr. A. Kaul
    125. Assessing Value of theProduct Category
      Determine the uses of the product
      Estimate the importance of the uses
      List competing products for the uses
      Determine the relative effectiveness of the product category in each usage situation
      3
      6. Why Customers Prefer a Product?
      Dr. A. Kaul
    126. Assessing the Value of he Brand/Product/Service
      Assessing the total value of a brand can be done indirectly
      A high-value brand has:
      High Market Share
      High Repeat Purchase Rate
      Low Elasticity with respect to Price
      Limited Competitive Brand Shopping
      3
      6. Why Customers Prefer a Product?
      Dr. A. Kaul
    127. Using customer responses to estimate the value of a brand directly:
      Ratings for competing products
      Constant sum ratings across brands
      Graded paired comparisons
      Conjoint analysis
      3
      6. Why Customers Prefer a Product?
      Dr. A. Kaul
    128. Customer Response
      Sensitivity and Preference Varies by Customer:
      To Price – and to means of payment
      Distribution and Availability – including the effect of direct marketing
      Advertising
      Promotion
      Service
      3
      7. How Customers Respond to Marketing Programs?
      Dr. A. Kaul
    129. Assessing Sensitivity
      Expert Judgment – using knowledge of managers, sales-force
      Customer Survey – including both direct questioning and more subtle approaches as conjoint analysis
      Experiments – both controlled settings and actual market segments
      Analyses of Past Data – across market segments or individual customer records
      3
      7. How Customers Respond to Marketing Programs?
      Dr. A. Kaul
    130. Decision to Purchase
      Critical Issue – whether new or current customer will purchase the product in the future
      Quality Program – satisfy and retain customers
      Relationship Marketing – long-term, lifetime, value of a customer
      3
      8. Why Customers Buy It (Again?)
      Dr. A. Kaul
    131. Quality - Satisfaction
      Quality is ultimately measure in terms of customer satisfaction
      Satisfaction has a strong relative component to quality
      Are customers of the product category more or less satisfied than those of a different but potentially substitutable one?
      Are customers of the company’s product more or less satisfied than customers of a competitor’s?
      3
      8. Why Customers Buy It (Again?)
      Dr. A. Kaul
    132. Measurement ofSatisfaction
      Three Key Aspects
      Expectations of Performance/Quality
      Perceived Performance/Quality
      The Gap between Expectations and Performance
      3
      8. Why Customers Buy It (Again?)
      Dr. A. Kaul
    133. Indirect Measures
      Word-of-Mouth Comments
      Complaints
      Compliments
      Repeat purchase – or lack thereof
      3
      8. Why Customers Buy It (Again?)
      Dr. A. Kaul
    134. Why Satisfaction?
      Leads to Loyalty
      Customer Retention
      Intention to Purchase
      3
      8. Why Customers Buy It (Again?)
      Dr. A. Kaul
    135. Satisfied but No Repurchase
      Due to Poor Product Supply
      Variety Seeking or Multiple Sourcing
      Large Promotional Deals
      Unsatisfied but Continue to Purchase
      Monopoly
      Convenience
      3
      8. Why Customers Buy It (Again?)
      Dr. A. Kaul
    136. Segmentation
      Each Customer is Unique
      Mass Marketing is Generic
      Each Customer Strategy
      Time-Consuming
      Not Very Profitable
      Group Customers into Segments
      A Compromise
      3
      Dr. A. Kaul
    137. Insights into Different Kinds of Customer Behavior
      Makes Marketing Programs more Efficient
      With IT one-to-one Marketing is Viable
      But Segmentation is the Norm
      3
      Segmentation
      Dr. A. Kaul
    138. Criteria for Segmentation
      Sizeable
      Identifiable
      Reachable
      Respond Differently
      Coherent
      Stable
      3
      Dr. A. Kaul
    139. Methods for MarketSegmentation
      Simple to Apply, Easy-to-Use software, and require Descriptive and Behavioral Data
      Cluster Analysis
      Tabular Analysis
      Regression Analysis
      Latent Class Analysis
      3
      Dr. A. Kaul
    140. Cluster Analysis
      Examines the values of the variables for each respondent , from a sample of customers, and then groups the respondents with similar values
      Purchase
      Quantity
      Age
      3
      Cluster
      Cluster
      A
      C
      Cluster
      B
      Dr. A. Kaul
    141. Phone company employed Cluster Analysis to understand its regional customers
      Six segments based on clustering households
      Low Income/Blue Collar – Fledglings
      Frugal/Retired – Thrifties
      Contended Middle Class – Contenteds
      Aspiring M-C Status Seekers – Climbers
      Technology –Driven Strivers – Techies
      Contended Upper Middle-Class - Executives
      3
      Cluster Analysis
      Dr. A. Kaul
    142. Industrial-products company segmented its national accounts based on trade-offs between price and service to form four segments
      Programmed Buyers – small customer, routine purchases
      Relationship Buyers – small buyers, loyal, pay low prices and obtain high service levels
      Transaction Buyers – large buyers, obtain price discounts, expect high service levels, switch suppliers
      Bargain Hunters – large buyers, lowest prices, highest service levels
      3
      Cluster Analysis
      Dr. A. Kaul
    143. Tabular Analysis
      This analysis uses categorical variables based on customer responses
      Descriptor Variables – related to attitude, independent variables
      Convenience Oriented
      Enthusiastic
      Disinterested
      Behavioral Variables – dependent variables
      Small/Light, Medium, Large/Heavy
      3
      Also Called Cross-Tabular Analysis
      Dr. A. Kaul
    144. Regression Analysis
      Is used when the product manager can specify an explicit relationship between behavioral, dependent variable, and one or more descriptor, independent variable
      However, unlike tabular analysis it assumes a continuously measured dependent variable, quantity rather than category of usage
      3
      Dr. A. Kaul
    145. Usage = f (price, convenience oriented, enthusiastic, disinterested, low, medium, high income)
      Regression performed using regression coefficients to represent the regression model in an equation form
      U = aP + bC + cE + eD + fL + gM + hH
      3
      Regression Analysis
      Dr. A. Kaul
    146. Results may suggest:
      Price sensitivity depends on various service characteristics – quality, support
      Price responsiveness exists across counties and continents – segmentation based n responsiveness rather than country boundaries are useful for global marketing
      3
      Regression Analysis
      Dr. A. Kaul
    147. Latent Class Segmentation
      Begins with the market as a whole and then determines what segmentation pattern best trades off few segments and the ability to explain behavior
      The previous methods begin with individuals and then aggregate them
      Is recent, intriguing, requires sophistication –
      not widely used
      3
      Dr. A. Kaul
    148. Judgment-BasedSegmentation
      Useful because segments are readily identifiable and reachable
      Heavy, Light, Non-Users
      Can be used as a basis for comparison with results of computer-based analysis
      Segments based on intuition may exist only in the mind of a manager and not in the market
      3
      Dr. A. Kaul
    149. Environmental Influences On Consumer Behavior
      3
      Dr. A. Kaul
    150. Consumer Motivation - Maslow’sHierarchy of Needs
      3
      Dr. A. Kaul
    151. Consumer Decision-MakingProcess
      3
      Problem Recognition
      Information Search
      Alternative Evaluation
      Purchase Decision
      Post-Purchase Evaluation
      Dr. A. Kaul
    152. Consumer’s InternalPsychological Processes
      3
      Motivation
      Perception
      Attitude Formation
      Integration
      Learning
      Dr. A. Kaul
    153. Percentage of Users Loyal toOne Brand in the Category
      Product %
      Toothpaste 61
      Automobile 47
      Perfume/After Shave 46
      Shampoo 44
      Soft Drink 44
      Athletic Shoes 27
      3
      Dr. A. Kaul
    154. Consumer Attitude
      Important to Marketers
      Summarize a Consumer’s Evaluation of a Brand or Company
      Represent Positive or Negative Feelings
      Are Related to Consumer’s Purchase Behavior
      3
      Dr. A. Kaul
    155. Demand Analysis
      Three Broad Categories of Demand
      Effective – demand backed by purchasing power
      Potential – customer possesses purchasing power but is not currently buying
      Latent – one which the customer is unable to satisfy, usually for lack of purchasing power, or availability
      3
      Dr. A. Kaul
    156. Classic Demand Curve
      Price
      Quantity
      3
      Dr. A. Kaul
    157. Economic Assumptions of Consumer Demand
      The Consumer wants remain unchanged
      Has a fixed amount of money available
      Is one of many buyers
      Knows the price of all good, which are homogeneous
      If wishes, spends money in very small amounts
      Acts rationally
      3
      Dr. A. Kaul
    158. General DemandInfluencers
      Three broad Factors
      Demographics – effective demand is related population
      Buyer Behavior – demand reflects the aggregate needs and wants of individuals in the population
      Availability – supply and channels of distribution
      Price
      3
      Dr. A. Kaul
    159. Decline in Demand
      The reduction in promotional support will often lead to contraction in overall demand as the product loses the front-of-mind awareness, stimulated by advertising, so that usage will gradually decline
      3
      Dr. A. Kaul
    160. Dr. A. Kaul
    161. New Product Development
      Slightly New Products - Modification
      Change of Ingredients
      Adding Features
      Resembling Competitor Products
      New Products
      Offensive – gain sales or share
      Defensive – match or block competitors
      Really New Products
      Create/Expand a New Category
      4
      Dr. A. Kaul
    162. Development Stages
      Idea Generation
      Concept Development
      Feasibility Screening
      Concept Testing
      Product Development
      Product Testing
      Market Testing
      Go-No Go Decision
      4
      Dr. A. Kaul
    163. Model for New ProductDevelopment
      4
      Company Objective
      Exploration
      1,2
      Screening
      Business Analysis
      3,4
      Development
      Testing
      5
      Commercialization
      6,7
      8
      Product Success
      The Booz, Allen and Hamilton Model
      Dr. A. Kaul
    164. Business Analysis
      First Major Decision Stage
      Is venture potentially worthwhile, since expenditures will increase dramatically after this stage?
      Market Analysis
      Explicit Statement
      Explanation
      4
      Model for New Product Development
      Dr. A. Kaul
    165. Market Analysis
      Detailing potential total market
      Estimated market share with specific time horizon
      Competing products if any
      Likely price, break-even volume
      Identification of early adopters, specific market segments
      4
      Business Analysis
      Dr. A. Kaul
    166. Explicit Statement
      Technical Aspects
      Costs
      Production Implications
      Supplier Management
      Further R&D
      4
      Business Analysis
      Dr. A. Kaul
    167. Explanation
      How the Project Fits with Corporate Objectives?
      4
      Business Analysis
      Dr. A. Kaul
    168. Commercialization
      The Second Major Decision Stage is the Commercialization Stage – Launch Stage
      Last Stage in the Development Cycle
      Decisions to be made:
      When to launch the product?
      Where to launch it?
      How and to whom to launch it?
      4
      Dr. A. Kaul
    169. ImportantConsiderations
      Seasonality of the product
      Whether the launch should fit any trade or commercialization event
      Whether the new product is a replacement for the old one
      Whether it is advantageous to be first to market
      Launch location
      Launch strategy
      4
      Commercialization
      Dr. A. Kaul
    170. Line Extension
      Line Extension
      Product variant in the same category using the existing brand name
      4
      Dr. A. Kaul
    171. Line Extension
      Allow Full Line of Products
      Appeal to Multiple Segments
      Increase Potential Sales – customer base
      Allow Price Discrimination – among users with different needs and preferences
      Can Confuse Customers
      Can Dilute/Weaken Brand Equity
      4
      Line Extension
      Dr. A. Kaul
    172. Brand Extension
      Brand Extension
      Product in a different category using the existing brand name
      4
      Dr. A. Kaul
    173. Brand Extension
      Riskier than Line Extensions
      Brand must Fit in the New Category
      Image Match
      4
      Brand Extension
      Dr. A. Kaul
    174. Brand Risk/Fit/Image
      Pepsi Tofu – artificial drink doesn’t go with natural food
      IBM Pens – why would they bother?; what do know about making pens?
      Minute Maid Cranberry Juice – don’t they make this already?
      4
      Brand Extension
      Dr. A. Kaul
    175. Tide Facial Cleanser – makes me think of sandpaper rubbing on my skin
      McDonald’s Film Processing – I see chemicals in my food
      4
      Brand Extension
      Dr. A. Kaul
    176. Really New Products
      Create or Expand a New Category
      Are New to Customers
      Raise Issues of Channels of Distribution and Organizational Responsibility
      May Create a Need for Infrastructure
      4
      Dr. A. Kaul
    177. Examples of ReallyNew Products
      Consumer Goods
      Packaged Goods – bottled tea, frozen vegetables
      Durable Goods – microwave ovens, rooms air conditioners
      Industrial Products – microprocessor chips, mobile phones
      Services – ATM’s, credit cards, Internet
      4
      Dr. A. Kaul
    178. Getting Ideas for NewProducts
      Customer Analysis – surveys of attitudes and attribute importance – unstructured (focus groups) – structured (conjoint analysis)
      Competitor Analysis – most new products are copies of competitors’ products
      4
      Dr. A. Kaul
    179. Active Search – new products and processes in other areas
      Category Analysis –examining social trends, technologies
      Brainstorming – generating ideas for new products can be difficult
      4
      Getting Ideas for New Products
      Dr. A. Kaul
    180. Brainstorming
      New Market/Customer Acquisition – who else can we sell it to?
      Customer Expansion – what else can we sell them?
      4
      Getting Ideas for New Products
      Dr. A. Kaul
    181. Product Variants/Line extensions – what different features can we add or replace
      Value Chain Changes – how else can we get it to the customer?
      4
      Brainstorming
      Dr. A. Kaul
    182. Getting Ideas for Really New Products
      Similar to New Products but with a certain radical quality
      Asking or listening to dissatisfied customers
      Asking non-representative customers
      Open-ended qualitative surveys
      Involving customers as co-developers
      Listening to newcomers and non-experts
      Scanning the literature
      4
      Dr. A. Kaul
    183. Testing New Products
      Concept Testing
      Surveys – useful for forecasting
      Focus Groups – detailed diagnosis
      Demonstrations – present the concept
      Product Testing
      Market Testing
      4
      Dr. A. Kaul
    184. Product Testing
      1. Product Tests
      Uncover product shortcomings
      Evaluate commercial prospects
      Evaluate alternative formulations
      Uncover the appeal
      Gain ideas for marketing-mix
      4
      Testing New Products
      Dr. A. Kaul
    185. Types of Product Tests
      Small Samples – employees
      Limited-Time Horizon – forced-trial
      Placement of Product in Homes - elaborate
      4
      Product Testing
      Dr. A. Kaul
    186. 2. Discrimination and Preference Testing
      Discrimination is the ability to correctly identify differences from the product alone, without cues such as brand name and ingredients
      Preference can be the result of true discrimination or of random guessing
      4
      Dr. A. Kaul
    187. 3. Market Testing
      The purpose of such tests is to predict sales and profits from a major product launch
      4
      Dr. A. Kaul
    188. ‘Practice’ so that marketing, distribution, and production skills are developed before entering full-scale operations
      Projections are made for both share and actual sales
      4
      Market Testing
      Dr. A. Kaul
    189. Test Design Requirements
      Action Standards
      Where to Test
      What to Do
      How Long
      Cost
      Information Gathering
      4
      Market Testing
      Dr. A. Kaul
    190. 4. Quasi-Market Tests
      Market tests tend to be expensive
      They take time and tip off competitors
      Simulated Test Methods
      ASSESOR
      BASES
      LITMUS
      4
      Dr. A. Kaul
    191. Evaluation Criteria for ReallyNew Products
      Customer Level
      Do customers like it?
      Is it unique?
      Will they buy it?
      How soon/fast will they buy it?
      4
      Dr. A. Kaul
    192. Firm Level
      1. Does it add to our customer base through
      Acquisition?
      Expansion
      Loyalty/retention?
      Enhanced brand equity?
      4
      Evaluation Criteria for Really New Products
      Dr. A. Kaul
    193. 2. Does it detract from our customer base through
      Cannibalization?
      Customer defections?
      Lowered brand equity?
      4
      Evaluation Criteria for Really New Products
      Dr. A. Kaul
    194. 3. Do we have the capabilities to
      Develop it?
      Produce it?
      Distribute and sell it?
      Buy or partner to do the above?
      4
      Evaluation Criteria for Really New Products
      Dr. A. Kaul
    195. 4. Will it be profitable
      On a stand-alone basis?
      Long-run impact on product line?
      5. Are there other benefits associated with it
      Learning/capability enhancement?
      PR?
      4
      Evaluation Criteria for Really New Products
      Dr. A. Kaul
    196. 6. Are there other costs associated with it?
      Legal liability?
      PR?
      7. Can we control the market in the short and long-run
      Against the new entrants?
      Against the entire competition?
      4
      Evaluation Criteria for Really New Products
      Dr. A. Kaul
    197. Typical Penetration For NewBrand Over Time
      Penetration, %
      Time
      4
      Ultimate Penetration Level – 45%
      Dr. A. Kaul
    198. Typical Repeat Rate For NewBrand Over Time
      Repurchase, %
      Time
      4
      Ultimate Repeat Rate – 15%
      Dr. A. Kaul
    199. Role of Product DevelopmentManager
      Manages the entre process
      Need for interdisciplinary inputs
      Need to develop product advantage
      Need for speed in the process
      Need to manage the information flow
      Need to manage the people
      4
      Dr. A. Kaul
    200. Factors Affecting Success
      4
      Process
      Timing
      Pre-Development Activities
      Development Activities
      Marketing Activities
      Launch Activities
      People
      Multifunctional
      Coordination
      Product Champion
      Communication
      Strategy
      Clear Objectives
      Innovation Culture
      Technology/Marketing
      Synergy/Risk
      Information
      Marketing
      External
      Communication
      Technical
      Successful New Product
      Organizational Structure
      Flexible
      Participative
      Interdisciplinary Teams
      Face-to-Face Communications
      Non-Hierarchical
      Management
      Top Commitment
      Set Cultural Climate
      Technology Support
      Inter-Level Communication
      Dr. A. Kaul
    201. Sony
      Has lost its leading-edge in new product development ,and in bringing new products to market
      What are the reasons?
      Dr. A. Kaul
    202. Apple’s iPod
      Samsung’s flat screen TV’s
      Korean digital cameras
      Chinese pen drives and multimedia players
      These companies and sources continue to push Sony out of its core consumer electronics market
      Sony
      Dr. A. Kaul
    203. This problem is partly due to Sony’s corporate culture,
      where business units are run separately, discouraging
      agility, cross fertilization, and anticipation of consumer needs
      Dr. A. Kaul
    204. Dr. A. Kaul
    205. Brand vs. Product, Brand Elements
      5
      Dr. A. Kaul
    206. What is a Brand?
      A brand is a name, terms, sign, symbol, design, or a combination intended to identify goods or services of a firm and differentiate them from the competitors
      5
      Dr. A. Kaul
    207. What is a Brand?
      Name a: Why?
      Company
      Product
      Service
      5
      Dr. A. Kaul
    208. A Brand Conveys:
      A Promise
      A Warranty
      5
      Dr. A. Kaul
    209. Brands – 6 Levels ofMeaning
      1. Attributes – Expensive, Durable , Well-Engineered
      2. Benefits – Expensive Prestige, Status
      Durability Long Lasting
      Well- Eng. Safety
      Values – Seller’s Matches Buyer’s
      Culture – Firms Culture Quality
      Personality – Motorcycles Swift, Agile Animal
      User – Type of Customers Demographics
      5
      Dr. A. Kaul
    210. Brand Meaning
      Deep
      Positioning On:
      Values
      Culture
      Personality
      Shallow
      Positioning Just On:
      Attributes
      Benefits
      Users
      5
      Dr. A. Kaul
    211. 5
      Using BDI and CDI Indexes
      Dr. A. Kaul
    212. 5
      Using BDI and CDI Indexes
      Dr. A. Kaul
    213. Dr. A. Kaul
    214. Brand Extension/Brand Relationships Spectrum
      6
      Dr. A. Kaul
    215. Brand RelationshipsSpectrum
      6
      Dr. A. Kaul
    216. Levels of Relationshipswith Brands
      6
      Dr. A. Kaul
    217. Dr. A. Kaul
    218. Brand Identity
      7
      Dr. A. Kaul
    219. Creating a Brand Image
      Competing Brands are Similar
      Difficult to Find a Unique Attribute or Benefit
      Differentiation on Functional or Performance Basis not Easy
      7
      Dr. A. Kaul
    220. Creating a Brand Image
      Develop Strong, Memorable Identity for the Brand through Image Advertising
      Image or Personality of the Brand is Particularly Important when the Brands are Similar
      7
      Dr. A. Kaul
    221. Dr. A. Kaul
    222. Brand Equity
      Brand Equity is the value of a product beyond that explainable by economic and functional attributes
      Brand equity represents value to the manufacturer and is represented by the premium a customers would pay for one product over another when economic and functional attributes are identical
      8
      Dr. A. Kaul
    223. Measuring Brand Equity
      At the Customer Level:
      Awareness – Necessary for purchase
      Associations – Reactions to the brand
      Attitude – Favorability, acceptability
      Attachment – Loyalty to the brand
      Activity – Spreading positive word
      8
      Dr. A. Kaul
    224. Manifestation of Customer Value
      Price – firm’s assessment of the product’s value
      Price Sensitivity – sales change with price
      Satisfaction – Indicated in surveys used as standard practice
      Complaints and Compliments – Number
      Word-of-Mouth – Difficult to track
      8
      Dr. A. Kaul
    225. Margin/Profit Contribution – Higher margins
      Sales – Value assessed by the market
      Competitive Activity – New-product introductions
      Repeat Purchase Rate – High loyalty indicates high brand value
      8
      Dr. A. Kaul
    226. India’s Trusted Brands
      Colgate
      Lux
      Dettol
      Pond’s
      Tata Salt
      LIC
      Vicks
      Britannia
      Rin
      Bata
      8
      Dr. A. Kaul
    227. The World’s Most ValuableBrands
      Rank Brand Brand Value, $B
      Coca-Cola 67
      IBM 59
      Microsoft 59
      GE 53
      Nokia 36
      Toyota 34
      Intel 31
      McDonald’s 31
      Disney 29
      Google 26
      8
      Dr. A. Kaul
    228. Top 20 Brands
      Rank Brand Brand Value, $B
      Mercedes Benz 26
      HP 23
      BMW 23
      Gillette 23
      American Express 22
      Louis Vuitton 22
      Cisco 21
      Marlboro 21
      Citi 20
      Honda 19
      8
      Dr. A. Kaul
    229. Coca-Cola Brands
      8
      Dr. A. Kaul
    230. Factors Affecting BrandEquity
      8
      NAME AWARENESS
      BRAND ASSOCIATIONS
      PERCEIVED QUALITY
      BRAND EQUITY
      Name
      Symbol
      BRAND ASSETS
      BRAND LOYALTY
      Value to Firm
      BRAND LOYALTY
      Efficient and Effective Marketing Programs
      Price/Margins
      Brand Extensions
      Trade Leverage
      Competitive Advantage
      VALUE TO CUSTOMER
      Easier to Interpret Benefits
      Feel Confident in the Purchase Decision
      Get more Satisfaction in Use
      Dr. A. Kaul
    231. Dr. A. Kaul
    232. Brand Building Strategies
      10
      Dr. A. Kaul
    233. Brand Positioning
      Is the act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market
      9
      Dr. A. Kaul
    234. Positioning Strategy
      Competitive Frame of Reference
      MOOV, back pain for women
      Points–of–Difference
      FedEx, overnight delivery nationally
      Points–of–Parity
      Savlon, antiseptic no sting
      Redefining Category
      BMW, both luxury and performance
      9
      Dr. A. Kaul
    235. Introductory BrandingStrategy
      9
      Dr. A. Kaul
    236. Perceptual or PositioningMap
      High Quality
      F A
      D
      Low High
      Performance C B Performance
      Low Quality
      9
      Dr. A. Kaul
    237. 4P Marketing Mix – 4A Rural Challenges
      4Ps 4As
      Product Acceptability
      Price Affordability
      Place Availability
      Promotion Awareness
      9
      Dr. A. Kaul
    238. Elements of PromotionalMix
      Advertising
      Sales Promotion
      Publicity and Public Relations
      Personal Selling
      Direct Marketing
      Internet Marketing
      9
      Dr. A. Kaul
    239. Corp. Marketing Dept. –Centralized
      9
      Marketing
      Product
      Planning
      Advertising
      Sales Promotion
      Marketing Research
      Dr. A. Kaul
    240. Corp. Marketing Dept. –Decentralized
      9
      Marketing
      Product Management
      Sales
      Marketing Services
      Marketing Services
      Brand Manager
      Brand Manager
      Advertising
      Department
      Marketing Research
      Dr. A. Kaul
    241. Brand Manager
      Responsible for Ad and Promotions
      Works closely with Outside Ad Agency and other Marketing Communication Specialists
      May have own Ad Agency
      May Compete with other, even in the same Product Category
      9
      Dr. A. Kaul
    242. Concrete Objectives –Foster’s Beer
      Strengthen the Brands Image
      Maximize Brand Presence
      Broaden the Market Base Beyond Traditional Import Beer Drinkers
      Increase Sales
      9
      Dr. A. Kaul
    243. Positioning
      In the Minds of the Consumer
      For Companies as well as Brands
      Distinctive Attribute
      Price/Quality
      Usage/Application
      Product Users/Class
      Creative Strategy for Multiple Brands in the same Market Segment
      9
      Dr. A. Kaul
    244. Top 10 Advertising Slogansof the Century
      Company/Brand Campaign Theme
      DeBeers Diamonds are forever
      Nike Just do it
      Coca-Cola The pause that refreshes
      Miller Lite Tastes great, less filling
      Avis We try harder
      Maxwell House Good to the last drop
      Wheaties Breakfast of champions
      Clairol Does she…..or doesn’t she
      Morton Salt When it rains it pours
      Wendy’s Where’s the beef?
      9
      Dr. A. Kaul
    245. End of Course
      Dr. A. Kaul
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