Module_3 (1).pdf

MISSION
CHRIST is a nurturing ground for an individual’s holistic development to
make effective contribution to the society in a dynamic environment
VISION
Excellence and Service
CORE VALUES
Faith in God | Moral Uprightness
Love of Fellow Beings
Social Responsibility | Pursuit of Excellence
Module 3
Product

CHRIST
Deemed to be University
Product Characteristics
and Classifications
● Product
○ Anything that can be offered
to a market to satisfy a want
or need, including physical
goods, services, experiences,
events, persons, places,
properties, organizations,
information, and ideas
○ A Product is anything that
can be offered in a market for
attention, acquisition, use, or
consumption that might
satisfy a need or want

CHRIST
Product Levels: The Customer-Value
Hierarchy
Five Product Levels

CHRIST
Product Classifications
Durability
Tangibility
Use

CHRIST
Durability and Tangibility
Nondurable goods
Durable goods
Services

CHRIST
Consumer-Goods Classification
Convenience
Shopping
Specialty
Unsought

CHRIST
Industrial-Goods Classification
Materials and parts
Capital items
Supplies and
business services

CHRIST
Product Differentiation
• Form
• Features
• Performance quality
• Conformance quality
• Durability
• Reliability
• Reparability
• Style
• Customization

CHRIST
Services Differentiation
Ordering ease
Delivery
Installation
Customer training
Customer consulting
Maintenance and repair
Returns

CHRIST
Design
● Design
○ The totality of features that affect the
way a product looks, feels, and
functions to a consumer

CHRIST
Design
Is emotionally powerful
Transmits brand meaning/positioning
Is important with durable goods
Makes brand experiences rewarding
Can transform an entire enterprise
Facilitates manufacturing/distribution
Can take on various approaches

CHRIST
Luxury brands
● Quality
● Uniqueness
● Craftsmanship
● Heritage
● Authenticity
● History

CHRIST
Environmental Issues
● Environmental issues are also playing an
increasingly important role in product design and
manufacturing

CHRIST
The Product Hierarchy
1. Need
family
2. Product
family
3. Product
class
4. Product
line
5. Product
type
6. Item

CHRIST
Product Systems
and Mixes
● Product system
● Product mix/assortment
○ Width
○ Length
○ Depth
○ Consistency

CHRIST
Product line length
● Line stretching
○ Down-market stretch
○ Up-market stretch
○ Two-way stretch
● Line filling
● Line modernization
● Line featuring
● Line pruning

CHRIST
Product Mix Pricing
● The firm searches for a set of prices that maximizes profits on the total mix
Product line
pricing
Optional-
feature
pricing
Captive-
product
pricing
Two-part
pricing
By-product
pricing
Product-
bundling
pricing

CHRIST
Co-Branding
● Two or more well-known brands are combined into a joint product or marketed together in some
fashion
Same-company
Joint-venture
Multiple-sponsor
Retail

CHRIST
Ingredient Branding
● Co-branding that creates brand equity for parts that are necessarily contained within other
branded products

CHRIST
Packaging
● All the activities of designing and producing the container for a product

CHRIST
Packaging
Used as a marketing tool
• Self-service
• Consumer affluence
• Company and brand
image
• Innovation opportunity
Packaging objectives
• Identify the brand
• Convey descriptive and
persuasive information
• Facilitate product
transportation and
protection
• Assist at-home storage
• Aid product consumption

CHRIST
Labeling, Warranties, and Guarantees
● Labeling
○ Identifies, grades, describes, and promotes the product
● Warranties
○ Formal statements of expected product performance by the manufacturer
● Guarantees
○ Promise of general or complete satisfaction

CHRIST
The Nature of Services
● Service
○ Any act or performance one party can offer to another that is essentially intangible and
does not result in the ownership of anything

CHRIST
Characteristics
of Services
Intangibility
Inseparability
Variability
Perishability

CHRIST
Intangibility
● Services cannot be seen, tasted, felt, heard, or smelled
Physical evidence and presentation tools:
Place
People
Equipment
Communication material
Symbols
Price

CHRIST
Inseparability
● Services are typically produced and consumed simultaneously

CHRIST
Variability
● The quality of services depends on who
provides them, when and where, and to
whom
○ As such, services are highly variable

CHRIST
Perishability
● Services cannot be stored
● Strategies to match demand & supply
On demand side
• Differential pricing
• Nonpeak demand
• Complementary services
• Reservation services
On supply side
• Part-time employees
• Peak-time efficiency routines
• Increased consumer
participation
• Shared services
• Facilities for future expansion

CHRIST
Blueprint for Overnight Hotel Stay

CHRIST
Differentiating Services
● Primary and secondary service options
● Innovation with services

CHRIST
Managing Service Quality
● Customer switching behavior factors
Pricing
Inconvenience
Core service failure
Service encounter failures
Response to service failure
Competition
Ethical problems
Involuntary switching

CHRIST
service-quality model

CHRIST
Improving
Service Quality
• Listening
• Reliability
• Basic service
• Service design
• Recovery
• Surprising
customers
• Fair play
• Teamwork
• Employee research
• Servant leadership

CHRIST
Extending the Service-Quality Model
● Dynamic process model of improved service quality perceptions
○ Increasing customer expectations of what the firm will deliver
○ Decreasing customer expectations of what the firm should deliver

CHRIST
Managing Product-Support Services
● Three types of customer worries
Failure frequency
Downtime
Out-of-pocket costs

CHRIST
Postsale Service Strategy
● Customer-service evolution
● The customer-service imperative

CHRIST
New-Product Options
● Buy other companies
● Buy patents from other
companies
● Buy a license or franchise from
another company
● New-to-the-world items
● Improvine existing products

CHRIST
Challenges in New-Product Development
● The innovation imperative
○ Continuous innovation is a necessity
● New-product success
○ Incremental innovation vs. disruptive
technologies

CHRIST
New-Product Failure
• Fragmented
markets
• Social, economic,
and government
constraints
• Development costs
• Capital shortages
• Shorter
development time
• Poor launch timing
• Shorter PLCs
• Lack of
organizational
support

CHRIST
Organizing New-Product Development
● New-product development concepts
New-
product
department
Venture
teams
Skunkworks
Communities
of practice
Crowdsourcing
Stage-gate
systems

CHRIST
New-Product Development Process

CHRIST
Generating Ideas
● Interacting with employees
● Interacting with outsiders
● Studying competitors
● Adopting creativity techniques

CHRIST
Ways to Find New-Product Ideas
• Informal customer
sessions
• Time off for technical
people to putter
• Customer
brainstorming
• Survey your
customers
• “Fly on the wall”
research
• Iterative rounds with
customers
• Keyword search to
scan trade
publications
• Treat trade shows as
intelligence missions
• Have employees visit
supplier labs
• Set up an idea vault

CHRIST
Ways to draw new ideas from customers
Observe customers using product
Ask customers about product
problems
Ask customers about dream products
Use customer advisory board
Use Web sites
Form brand community of enthusiasts
Challenge customers to improve
product

CHRIST
Adopting creativity techniques
Attribute
listing
Forced
relationships
Morphological
analysis
Reverse-
assumption
analysis
New contexts
Mind
mapping

CHRIST
Forces Fighting New Ideas

CHRIST
Using Idea Screening
● The company can monitor and revise its estimate of the
product’s overall probability of success, using the following
formula:

CHRIST
Concept to Strategy
● Concept development
○ product-positioning map
○ brand-positioning map

CHRIST
Concept to Strategy
● Concept testing responses
Communicability &
believability
Need level
Gap level
Perceived value
Purchase intention
User targets, purchase
occasions & frequency

CHRIST
Development to Commercialization
● Product development
○ Physical prototypes
○ Customer tests: alpha & beta testing

CHRIST
● Market testing
○ Consumer-goods market testing
○ Business-goods market testing

CHRIST
Methods of Consumer-Goods Market Testing
Sales-wave research
Simulated test marketing
Controlled test marketing
Test markets

CHRIST
● Commercialization: When (Timing)
First entry
Parallel entry
Late entry

CHRIST
● Commercialization
○ Where (Geographic Strategy)
○ To Whom (Target-Market Prospects)
○ How (Introductory Market Strategy)

CHRIST
The Consumer-Adoption Process
● Adoption
○ An individual’s decision to become a regular user of a product

CHRIST
Stages in the
Adoption Process
Awareness
Interest
Evaluation
Trial
Adoption

CHRIST
Factors Influencing the Adoption Process
● Readiness to try new products and personal influence

CHRIST
● Characteristics of the innovation
Relative advantage
Compatibility
Complexity
Divisibility
Communicability

CHRIST
● Organizations’ readiness to adopt innovations

Module_3 (1).pdf

Recommended

Recommended

More Related Content

Similar to Module_3 (1).pdf

Similar to Module_3 (1).pdf (20)

Recently uploaded

Recently uploaded (20)

Module_3 (1).pdf