Product Marketing Mix, Levels of Product, Types of Product, Product Mix, Product Line, Product Width, Product Life Cycle, Strategies in PLC, Product Diffusion, Brand, Brnad Equity, Repositioning, Branding, Packaging, LAbeling, New Product Development, Product Life Cycle Management

1. Product
Unit III

2. Product
• A product can be anything that can be
offered to the market to satisfy a want or
a need.
• A bundle of attributes, offering for
use/consumption by the final customer.

3. Levels of Product
5 basic levels. Each level adds more customer value
• CORE BENEFIT
• BASIC PRODUCT
• EXPECTED PRODUCT
• AUGUMENTED PRODUCT
• POTENTIAL PRODUCT
POTENTIAL
AUGUMENTED
EXPECTED
BASIC
CORE

4. Core product
• - Indicate core benefit or service
• - Explains what the buyer really buys
• - Basic step in designing products
• - Defines problem solving benefits/ services that
consumers seek
• - Standardization of technology does not lead to
much of difference from competing firms

5. Basic Product
• At this level, the core benefit is turned into
a basic product.
• Basic step in designing products
• Unbranded
• plainly packaged
• less expensive

6. Expected product
• Represents basic requirements, a customer finds
essential to buy a product
• - Attributes & conditiones required by the customers –
identified-built into products
• - Includes brand name, features, design, packaging,
quality level, styling, styling, attributes, instructions
manual

7. Augmented product
• Marketer prepares an augmented product that exceeds customer
expectations.
• Intangible component of the product along with formal & core
components
• Product built by adding consumer services & benefits

8. Potential Product
• The potential product includes all augmentations and
transformations the product might undergo in the future. In
simple language, this means that to continue to surprise and
delight customers the product must be augmented.

9. Five Product Levels Example:
1. Core Benefit: The core benefit of Coca-Cola is to quench a thirst.
2. Generic Product: The generic product is a burnt vanilla smelling, black,
carbonated, and sweetened fizzy drink.
3. Expected Product: The expected product is that the customer’s Coca-Cola is
cold. If this isn’t the case then expectations won’t be met and the drink will not
taste its best in the mind of the customer.
4. Augmented Product: Coca-Cola’s augmented product is that it offers Diet-
Coke. How does Coca-Cola exceed customers expectations with this product? By
offering all the great taste of Coca-Cola, but with zero calories.
5. Potential Product: One way in which Coca-Cola delights customers is by
running competitions. The prizes in these competitions are often things that,
“money can’t buy”, such as celebrity experiences. To continue to delight
customers over time the competition prizes change frequently.

10. Types of Products
1.Consumer Products:
• - Bought by final consumers for personal consumption
• - Categorized as…
• a. Convenience products ;
• - Bought frequently, immediately with minimum
comparison and buying effort.
• - Are low priced
• - Available in many locations
• e.g. Soap, candy, newspapers, fast food

11. Types of product
•b. Shopping Product;
• - Characteristically compared on the basis
of suitability, quality, price and style
while selection and purchase.
• - Distributed through fewer outlets
• e.g. Furniture, clothing, used cars, major
appliances, hotel and airline services.

12. Types of product
•c. Specialty Product;
• - Has unique characteristics or brand identification
for which a significant group of buyer is willing to
make a special purchase effort
• - People travel even long distances to buy them
(Lamborghini)
• - No comparison is involved in buying.
• e.g. Specific brands, types of cars, high priced
photographic equipments, designer clothes, services
of medical/ legal specialists

13. Types of product
•d. Unsought Product;
• - Consumer either does not know about/ knows
about but does not normally think of buying it.
• - Require a lot of advertising, personal selling and
marketing efforts.
• e.g. Life insurance, pre planned funeral services
and blood donations.

14. Types of Products
• 2. Industrial Products:
Distinguished from consumer products on the basis of usage e.g.
A lawn mower.
1.Materials & parts
i. Raw materials & parts:
- Farm products, (wheat, cotton, livestock, fruits, vegetables)
- Natural products (fish, lumber, crude oils, iron ore)
ii. Manufactured materials & parts:
- component materials (iron yarn, cement, wires)
- Component parts ( small motors, tires, castings)

15. Types of Products
• b. Capital items
i. Installations:
- Major purchases (factories, offices)
- fixed equipment ( generators, elevators,
computer systems)
ii. Accessory equipments:
- Portable factory equipments and tools
(hand tools, lift trucks)
- Office equipments ( computers, fax machines, desks)

16. Types of Products
• c. Supplies and Services:
i. Supplies
- Operating supplies (Lubricants, coal, paper, pencil)
- Repair and maintenance (paint, nails, brooms)
ii. Services
- Maintenance and repair services (window clearing,
computer repair)
- Business advisory services ( legal, management, consulting,
advertising)

17. Product Mix
• Product mix – Product mix is a combination of total product lines
within a company.
• The complete range of products present within a company is
known as the product mix.
• A company like HUL has numerous product lines like Shampoos,
detergents, Soaps etc. The combination of all these product lines
is the product mix.

19. Product Line
• The product line is a subset of the product mix. The product line
generally refers to a type of product within an organization
• In Nestle, there are milk based products like milkmaid, Food
products like Maggi, chocolate products like Kitkat and other such
product lines. Thus, Nestle’s product mix will be a combination of
the all the product lines within the company.

21. Product Mix Length
• The total number of products against the total number of product lines
forms the length of the product mix. This equation is also known as product
line length.

22. Product Mix Width
• The width of the product mix is equal to the number of product
lines within a company

23. Product Life Cycle (PLC)
Saturation
Point

24. PLC
Saturation
Point

25. PLC and Profit

26. PLC - Maruti 800

27. About Maruti
• MARUTI UDYOG LIMITED was established in 1981
• Largest automobile company in India located at Gurgaon, Manesar.
• Portfolio of 13 brands and 150 variants like,MARUTI
800,ALTO,WAGANOR,SWIFT,GRAND VITARA,SX4 AND SWIFT DZIRE
etc.,
• Listed in BOMBAY STOCK EXCHANGE &NATIONAL STOCK EXCHANGE.
• Honored with “METI” award from Govt. of Japan for promotion of
Japanese brand in India.

28. Introduction Stage 1983-86
• MARUTI UDYOG LIMITED Launched first ‘MARUTI 800’ ,in Indian market
on December 1983.
• It’s a collaboration between INDIAN STATE owned MARUTI and SUZUKI
MOTOR JAPAN.
• Cheapest car in the Indian market.
• Also exported to countries like South Asia and South American market.
• First car was presented to Lord Venkateswara of Tirumala Venkateswara
temple.
• First car was sold to Harpal Singh for Rs.48,000/- as a lucky owner and
received keys from Prime Minister of India INDIRA GANDHI.

29. Growth Stage 1987- 1996
• MARUTI 800 comes up with new features like , AC version and Music System in
the car.
• Sales increased by 852 units to 20,269 units and reached up to 31,314 units.
• First export began in 1987.
• Sales soared from about 63,763 units to about 1,89,061 units in 1996.
Strategies adopted:-
• Customer care has became a key element for Maruti,
• Increased Maruti service stations every 25 kms on a highway,
• For increasing its market share it launched new car models,

30. Maturity Stage 1997-2002
• In 1997,MARUTI introduced a new car with Jelly Bean shape, ZEN .
However it was not so successful in the market.
• Launched revamped version of MARUTI 800 EX, with new engine,
shock absorber, coil spring suspension, but this model lost their
sales gradually .
• Entry of competitors like General Motors , Ford , Tata.
• In 2002, MARUTI launched ‘ALTO’ ,with bigger stylish version of
the Maruti 800.
• Introduced LPG & CNG variables, called Maruti 800 Duo with new
face lifts like newer grille and clear lens head lamps

31. Maturity Stage 1997-2002 Contd…
Strategies adopted at this stage :
• Pricing strategy:– categoring to all segments ,car priced at Rs.
1,87,000/- is the lowest offer on the road
• Developed different revenue streams in the form of Maruti insurance,
Maruti finance.
• Repositioning of Maruti products
• Introduced new facelifts model based on market responses or consumer
feedbacks or the competitors moves
• Customer centric approach:
call centers bring Maruti to closer to its customer.
• Committed to motorizing India:
Partnership with STATE BANK OF INDIA
organized finance to small towns enable people to buy cars in Rs.2599/-
scheme

32. Decline Stage 2002 to till 2014
• Due to heavy competition from competitors like Hyundai i10 , Maruti
Suzuki Swift, Chevrolet Spark, sales of Maruti 800 was drastically
decreased.
• The sales are went down from 1,51,976 units in the year 2000 to about
69,553 in 2007.
• Buyers are attracted by high end luxuries small cars.
• In 2008-2009 experienced sales of only 1,288 units.
• Major competitor Tata Motors launched Tata Nano smaller car yet offer
more space than the Maruti 800
• Sales are continued in semi urban and rural areas till today .
• In 2012 Maruti introduces ALTO 800 in the place of Maruti 800 .

33. Sales between 2000 - 2004

34. PLC Explained
• A new product progresses through a sequence of stages from
introduction to growth, maturity, and decline. This sequence is
known as the product life cycle and is associated with changes in
the marketing situation, thus impacting the marketing strategy
and the marketing mix.

35. Introduction Stage: Strategies
In the introduction stage, the firm seeks to build product awareness
and develop a market for the product. The impact on the marketing mix
is as follows:
• Product branding and quality level is established, and intellectual
property protection such as patents and trademarks are obtained.
• Pricing may be low penetration pricing to build market share rapidly, or
high skim pricing to recover development costs.
• Place/ Distribution is selective until consumers show acceptance of the
product.
• Promotion is aimed at innovators and early adopters. Marketing
communications seeks to build product awareness and to educate
potential consumers about the product.

36. Challenges of the Introduction Stage
• Small or no market
• High costs
• Losses, Not Profits

37. Growth Stage: Strategies
In the growth stage, the firm seeks to build brand preference and
increase market share.
• Product quality is maintained and additional features and support
services may be added.
• Pricing is maintained as the firm enjoys increasing demand with
little competition.
• Distribution channels are added as demand increases and
customers accept the product.
• Promotion is aimed at a broader audience.

38. Challenges of the Growth Stage
• Increasing Competition
• Lower Prices
• Different Marketing Approach
• Costs are Reduced
• Greater Consumer Awareness
• Increase in Profits

39. Maturity Stage: Strategies
At maturity, the strong growth in sales diminishes. Competition
may appear with similar products. The primary objective at this
point is to defend market share while maximizing profit.
• Product features may be enhanced to differentiate the product
from that of competitors.
• Pricing may be lower because of the new competition.
• Distribution becomes more intensive and incentives may be
offered to encourage preference over competing products.
• Promotion emphasizes product differentiation.

40. Challenges of the Maturity Stage
• Sales Volumes Peak
• Decreasing Market Share
• Profits Start to Decrease
• Continued Reduction in Costs
• Increased Market Share Through Differentiation

41. Decline Stage: Strategies
As sales decline, the firm has several options:
• Maintain the product, possibly rejuvenating it by adding new features and
finding new uses.
• Harvest the product - reduce costs and continue to offer it, possibly to a
loyal niche segment.
• Discontinue the product, liquidating remaining inventory or selling it to
another firm that is willing to continue the product.

42. Challenges of the Decline Stage
• Market in Decline
• Falling Sales and Profits
• Product Withdrawal
• Cheaper Production
• Cheaper Markets

43. Alternative product life cycles
Why the different shapes?

44. PRODUCT DIFFUSION
• The market diffusion process is strongly linked to the adoption
process, which describes the way in which an individual customer
learns about an innovation. During the market diffusion process,
the marketer must recognize that people differ greatly in their
readiness to adopt new products. Based on this idea, five market
segments can be distinguished by the time consumers take to
adopt new products.

45. TYPES OF CUSTOMER IN MARKET DIFFUSION
CUSTOMER
TYPES
INNOVATORS
EARLY ADOPTERS
EARLY MAJORITY
LATE MAJORITY
LAGGARDS

46. TYPES OF CUSTOMER IN MARKET DIFFUSION
Innovators
• Innovators are the “early-bird” customers, that is, the first ones
to adopt the new product. They do normally not represent more
than 2.5% of the population. They are venturesome in nature and
are prepared to run the risk of buying a product that ultimately
proves not to live up to their expectations, rather than missing the
chance to try something new. For the marketer, innovators are
important since they represent the initial target and influence
later adopters. A new product that fails to win the esteem of this
group is not very likely to ever reach and penetrate the mass
market.

47. TYPES OF CUSTOMER IN MARKET DIFFUSION
Early adopters
Early adopters represent the next 13.5% of the population to adopt the new
product. As respected members of the community, they are likely to be opinion
leaders for others who will only buy the product when it has been “approved” by
the early adopters.
Early Majority
The early majority accounts for about 34% of the population. This type of
customer is more cautious of new products than the early adopters. If they are
exposed to sufficient information, they will follow the example of the early
adopters. The early majority is an important target for firms who aim for taking
their products from the introduction to the growth stage of the PLC.

48. TYPES OF CUSTOMER IN MARKET DIFFUSION
Late majority
The late majority are the 34% of the population who are more skeptical
about new products and harder to persuade. They place greater
importance on word of mouth recommendations than the media for to
obtain information about new products.
Laggards
Laggards are the last 16% of the population. They are the most reluctant
to try new products. Often, they adopt new products only when their
favoured items have been discontinued. Members of this group are often
older and/or from lower socio-economic groups.

49. TYPES OF CUSTOMER IN MARKET DIFFUSION

50. What are the five stages of diffusion?
• Knowledge
• The first step in the diffusion of innovation is knowledge. This is
the point at which the would-be adopter is first exposed to the
innovation itself. They do not have enough information to make a
decision to purchase on and have not yet been sufficiently inspired
to find out more.
• At this stage marketers will be looking to increase awareness of
the product and provide enough education that the prospective
adopter moves to the 2nd stage.

51. What are the five stages of diffusion?
• Persuasion
• Persuasion is the point at which the prospective adopter is open to
the idea of purchase. They are actively seeking information which
will inform their eventual decision.
• This is the point at which marketers will be seeking to convey the
benefits of the product in detail. There will be a conscious effort
to sell the product to someone at this stage of the diffusion of
innovation.

52. What are the five stages of diffusion?
•Decision
• Eventually the would-be adopter must make a decision. They will
weigh up the pros and cons of adoption and either accept the
innovation or reject it.
• It is worth noting that this is the most opaque part of the process.
Rogers cites this as the most difficult phase on which to acquire
intelligence. This is, at least in part, due to the fact that people
do not make rational decisions in many instances. They make a
decision based on their underlying perceptions and feelings and
following the decision they attempt to rationalize that decision..

53. What are the five stages of diffusion?
•Implementation
• Once a decision to adopt a product has been
made the product will, in most cases, be used by
the purchaser. This stage is when the adopter
makes a decision as to whether or not the
product is actually useful to them. They may also
seek out further information to either support the
use of the product or to better understand the
product in context.

54. What are the five stages of diffusion?
•Confirmation
• This is the point at which the user evaluates their
decision and decides whether they will keep using the
product or abandon use of the product. This phase can
only be ended by abandonment of a product otherwise it
is continual. (For example, you may buy a new car today
– you are highly likely to keep using the car for a number
of years – eventually, however, you will probably sell the
car and buy a new one).

55. Brand Equity
• With the term brand equity, marketers describe the "value" of a
brand. Brand equity doesn't refer to a brand's financial value. It is
determined, instead, by consumer perception and is driven by
positive (or negative) customer experience.
• The benefits of positive brand equity are many: consumers are
willing to pay more money for the same products; when brands
extend product lines, new products are perceived just as
favourably; ultimately, brand equity directly affects stock price.

56. Components of Brand Equity
• Brand Awareness
• The first step of the brand building process is creating awareness
of the brand name in the mind of consumers. This means that
customers are aware of the brand and able to associate it with a
particular category. Building brand awareness can help marketers
to increase brand visibility to the target audience through
different advertisement campaigns.

57. Components of Brand Equity
• Brand Association
• Brand association is anything that a customer relates to their
preferred brand. Getting in interaction with brands allows such
associations. Having a good brand association is important as it
leads to repetitive sales and provides the business word of mouth
marketing. Such associations are leveraging the brand and give a
tough time to new entrants into the market.

58. Components of Brand Equity
• Brand Experience
• This is the aggregation of customer experience with the overall
brand. When customers have the good brand experience they will
consider the brand as superior and will start preferring it over
others.
• For example, how you feel when eating at McDonald’s? How is the
overall inner environment, how the staff behaves and what is the
quality of the food? To provide the same experience, the company
have to maintain uniform standards all over the outlets in the
world.

59. Components of Brand Equity
• Perceived Quality
• Fulfilling brand promise is the key to strong brand equity.
Customer tends to assess brands with other similar brands on the
basis of various quantitative and qualitative parameters. Quality
perception also impacts the pricing decision of a company. If a
company produce quality products, it can avail the luxury of
premium pricing.

60. Components of Brand Equity
• Brand Loyalty
• Brand loyalty is the preference of a brand by the customer over
similar products in the market. This results in repetitive sales and
is the best way to spread word of mouth. If a company has a
higher brand loyalty, it can help to reduce marketing cost. The
company can also introduce new products targeting the same
customer base.

61. Components of Brand Equity
• Brand Preference
• This is another component of brand equity and can charge
additionally for the same product. However, this requires
organizations to assure that customers have good experiences and
associations with the brand.

62. How to Manage Multiple Brands
• Umbrella strategy: Single Brand that sells multiple
products under one brand name
• APPLE: iPhone, Mac, iPad, Watch, etc.
• Proctor & Gamble (P&G): Pampers, Tide, Gillette, Pantene,
etc.
• Unilever: Dove, Axe, Lipton, etc.

63. How to Manage Multiple Brands
• Single brand identity: When a company aims each of its brands to
have and exclusive market segment.
• Ferrero: Rocher, Nutella, Hanuta, etc.
• Adidas: Adidas, Reebok.
• Multiple brand categories: When a company is having a portfolio of
products with different brand names, all owned and managed by
the same company.
• Nestle: Nespresso, KitKat, MilkMaid, Maggi, Etc.
• L’Oreal: Garnier, Maybelline, NYX, Etc.

64. How to Manage Multiple Brands
• Family of Names Strategy: This refers to a marketing strategy
that promotes family of products or services under one single
brand.
• TATA: Tata Safari, Tata Voltas, Tata Salt, etc.
• Britannia: Marie, 50-50, Bread , etc.

65. Examples: Positive Brand Equity
• Apple
• Apple is the best example of brand equity. Although all product of
this brand has similar features, the loyalty, demand and price
premium is higher than other similar brands.
• Facebook
• Many other social networking websites came and gone; however,
Facebook is quite consistent. Facebook has managed to attain
brand loyal customers that most of its users do not even look at
other social media platforms

66. Examples of Negative Brand Equity
• Goldman Sachs an investment bank and financial service company
lost its brand value when people realized its role in the 2008
financial crisis and took 10 years to recover its reputation.
• From 2009 to 2011 Toyota recalled almost 9 million cars due to
unintended acceleration and anti-lock brake software issues.
• Oil and gas brand Shell Oil spilled in the Nigeria delta damaged its
brand equity.

67. Repositioning: The process of changing the way
that people think about a product, service, or
company
IMAGE
REPOSITIONING
PRODUCT
REPOSITIONING
INTANGIBLE
REPOSITIONING
TANGIBLE
REPOSITIONING
PRODUCT
TARGET
MARKET
SAME DIFFERENT
SAME
DIFFERENT

68. REPOSITIONING
• Image repositioning – the first option is to keep both the target
market and the product unchanged, but to change the image of
the brand or product. In this scenario marketers work on
improving the image and perception of the product by its
customers and not on its features.
• Product repositioning – with this strategy, the product is changes
while the target market remains the same. This may be as a result
of technological advancements that make the original product less
desirable.

69. REPOSITIONING
• Intangible repositioning – this strategy requires the company to
target a different market with the same product. When marketers
discover that their product appeals to a wider range of customers
than the original market segment, this strategy will apply.
• Tangible repositioning – the most drastic and risky pivot in an
organisational positioning strategy is when both product and
target market are changed. When a new product no longer appeals
to the existing market, then tangible repositioning allows the
company to appeal to new markets where this new product will be
received better.

70. REPOSITIONING: Examples
• Hero & Honda
• Dabur
• Snapdeal
• Godrej
• Airtel
• Axis Bank
• India Post
• Cadbury India Ltd,

71. BRANDING
• A brand refers to a name, term, symbol, or any other type of
feature that defines or identifies a seller’s product or service.
• A brand consists of any name, term, design, style, words, symbols
or any other feature that distinguishes the goods and services of
one seller from another. A brand also distinguishes one product
from another in the eyes of the customer. All of its elements (i.e.,
logo, color, shape, letters, images) work as a psychological trigger
or stimulus that causes an association to all other thoughts we
have about this brand. Tunes, celebrities, and catchphrases are
also oftentimes considered brands.

72. Branding Attributes
• Brands have intrinsic and extrinsic attributes.
Intrinsic attributes refer to functional characteristics of the brand:
• its shape
• Performance
• physical capacity
(e.g. Gillette razors shave hair and are able to do so more closely
than most products in their product class because of their curved
shape). Should any of these attributes be changed, they will not
function in the same way or be the same product.

73. Branding Attributes
• Examples of extrinsic attributes are features like
• the price of the Gillette razors
• their packaging
• the Gillette brand name
• and mechanisms that enable consumers to form associations that
give meaning to the brand.
• For example, it can appear more desirable because David
Beckham, who is a brand himself, advertizes it.

74. Branding Attributes
Brands have different elements, namely
• brand personality (functional abilities),
• brand skill (its fundamental traits)
• and brand relationships (with buyers) or brand magic.
These elements are what give the brand added value.

75. PACKAGING AND LABELING
• Packaging refers to the physical appearance of a product when a
consumer sees it, and labels are an informative component of
packaging.

76. PACKAGING: USES
• Physical protection: The objects enclosed in the package may require
protection from, among other things, mechanical shock, vibration,
electrostatic discharge, compression, temperature, etc.
• Information transmission: Packages and labels communicate how to use,
transport, recycle, or dispose of the package or product. With
pharmaceuticals, food, medical, and chemical products, some types of
information are required by governments. Some packages and labels also
are used for track and trace purposes.

77. PACKAGING: USES
• Marketing: The packaging and labels can be used by marketers to
encourage potential buyers to purchase the product. Package graphic
design and physical design have been important and constantly evolving
phenomenon for several decades. Marketing communications and graphic
design are applied to the surface of the package and (in many cases)
• Convenience: Packages can have features that add convenience in
distribution, handling, stacking, display, sale, opening, re-closing, use,
dispensing, reuse, recycling, and ease of disposal.

78. PACKAGING: USES
• Barrier protection: A barrier from oxygen, water vapor, dust, etc., is often
required. Permeation is a critical factor in design. Some packages contain
desiccants or oxygen absorbency to help extend shelf life. Modified
atmospheres or controlled atmospheres are also maintained in some food
packages. Keeping the contents clean, fresh, sterile and safe for the intended
shelf life is a primary function.
• Security: Packaging can play an important role in reducing the security risks
of shipment. Packages can be made with improved tamper resistance to
deter tampering and also can have tamper-evident features to help indicate
tampering. Packages can be engineered to help reduce the risks of package
pilferage.

79. Labeling
A label is a carrier of information about the product. The attached label provides
customers with information to aid their purchase decision or help improve the experience
of using the product. Labels can include:
• Care and use of the product
• Recipes or suggestions
• Ingredients or nutritional information
• Product guarantees
• Manufacturer name and address
• Weight statements
• Sell by date and expiration dates
• Warnings

80. Labeling
Symbols Used in Labels
Many types of symbols for package labeling are nationally and internationally
standardized. For consumer packaging, symbols exist for product certifications,
trademarks, and proof of purchase. Some requirements and symbols exist to
communicate aspects of consumer use and safety.
Examples of environmental and recycling symbols include the recycling symbol, the
resin identification code, and the “green dot.”

82. NEW PRODUCT DEVELOPMENT
1. Idea Generation: includes: need/problem analysis, brainstorming, other
techniques from OB
2. Idea Screening: use a variety of product rating devices to limit the chance
of Type I(Go) error and Type II(Drop) errors
3. Concept Development and Testing: develop specific concepts which would
be aimed at specific target markets; start doing test marketing with focus
groups; can use conjoint analysis: a research method for deriving the utility
that consumers attach to varying levels of a products attributes.
4. Marketing Strategy Development: craft a marketing strategy plan which
includes:
I. target market size, structure and behavior, the planned product positioning & sales,
share & profit goals for the first few years.
II. Products planned price, distribution strategy and marketing budget
III. Long -run sales and profit goals and long term marketing mix

83. NEW PRODUCT DEVELOPMENT
5. Business Analysis: Evaluate the marketing plan will special emphasis on sales , cost,
profit estimates. Must pass the business test criteria for further development.
6. Product Development: Develop prototypes. Now using CAD-CAM to help. First have
functional tests then consumer tests.
7. Market Testing: Big time testing with brand name attached and packaging
developed.
I. Simulated Test Marketing is when you find 30 or 40 shoppers at a shopping center,
show them some ads, give them some money , and then see which brand they buy.
II. Controlled Test Marketing relies on a panel of real stores to carry the new
products for a fee. Sales are measured through scanners.
III. Test Markets are the ultimate way to test a new product. Company puts forth a
full scale advertising and marketing plan for selected cities/regions. Can uses diff
strategies in diff cities to compare effectiveness.

84. NEW PRODUCT DEVELOPMENT
8. Commercialization: With commercialization one has to ask three core
strategic questions: WHEN, WHERE, HOW
• When(Timing)–can be first entry, parallel entry, or late entry (late entry
can be good because the second firms can piggy-back on the first firm’s
advertising, can take advantage if there is a problem with the first
entry’s product, and can learn market size.
• Where(Geographical strategy)–start out regionally, or nationally, or
internationally
• How (Introductory market strategy)–marketing mix (ads, big party, dealer
incentives etc.)

85. Product Life cycle Management
• Product Lifecycle Management (PLM) is an integrated, information
driven approach to all aspects of a product’s life from its design
inception, through its manufacture, deployment and maintenance, and
culminating in its removal from service and final disposal.

86. Alter product quality
Enhance performance
Change appearance
• Modifying the Product
• Modifying the Market
 Finding New Users
 Increase use
 Create new use situations
MANAGING THE PRODUCT LIFE CYCLE

87. • Trading : add value raise price
• Trading Down- remove Value & lower price
• Downsizing-reduce contents but maintain price
 Reacting to a Competitor’s Position
 Catching a Rising Trend
 Changing the Value Offered
EXTENDING THE PRODUCT LIFE CYCLE- Repositioning

88. PLM Model
Info
Core
Requirements
Analysis & Planning
Concept Eng &
Prototyping
Product
Engineering
Manufacturing
Engineering
Manufacturing &
Production
Maintenance &
Repair
Disposal &
Recycling
Sales &
Distribution
Requirements
Analysis & Planning
Concept Eng &
Prototyping
Product
Engineering
Manufacturing
Engineering
Manufacturing &
Production
Maintenance &
Repair
Disposal &
Recycling
Sales &
Distribution

89. PLM (Product Lifecycle Management)
• Provide collaborative data environments that manages the
intellectual property associated with the evolving engineering,
construction, and maintenance definition
• Provide an accurate technical knowledge foundation and detailed
history of the configuration throughout the entire lifecycle, from
concept to disposal, while continuously coordinating complex
interdependent changes initiated by various technical and business
stakeholders

90. PLM
• Strong relationships between PLM (Product Lifecycle Management),
MES (Manufacturing Execution System), and ERP (Enterprise Resource
Planning) offers the ability to build a comprehensive closed loop
information system
• PLM is unique from other enterprise software solutions, by providing
the application depth and breadth needed to digitally author, validate
and manage the detailed product and process data, PLM supports
continuous innovation.

91. Main Components of PLM
• Data management: It enables appropriate stage for management. It
provides information about product features, bills of material, data
distribution, project structure.
• Program and project management: It’s about the process of
developing a product. It gives information on planning, management and
checking.
• Cooperation: It supports project management and it relies on WEB
standards which are based on XML(Extensible Markup Language)
• Quality management: It provides an integrated quality management
for each sector.
• Management of corporate assets: It directs equipment and physical
assets