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Chapter 10

Chapter 10 . Product Strategies: Basic Decisions & Product Planning. Chapter Outline . What Is a Product? New Product Development Market Segmentation Product Adoption. Chapter Outline . Theory of International Product Life Cycle - Stages and Characteristics - Validity of the IPLC

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Chapter 10

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  1. Chapter 10 Product Strategies: Basic Decisions & Product Planning

  2. Chapter Outline • What Is a Product? • New Product Development • Market Segmentation • Product Adoption

  3. Chapter Outline • Theory of International Product Life Cycle - Stages and Characteristics - Validity of the IPLC - Marketing Strategies • Product Standardization vs. Product Adaptation - Arguments for Standardization - Arguments for Adaptation

  4. Chapter Outline • A Move Toward World Product: International or National Product? • Marketing of Services - Importance of Services - Types of Services - The Economic and Legal Environment - Marketing Mix and Adaptation - Market Entry Strategies

  5. Product • a bundle of utilities or satisfaction • Bundling vs. unbundling

  6. New Product Development • generation of new product ideas • screening of ideas • business analysis • product development • test marketing • full-scale commercialization

  7. Factors Influencing Product Adoption • Relative advantage (+) • Compatibility (+) • Trialability/divisibility (+) • Observability (+) • Complexity (-) • Price (-)

  8. Theory of International Product Life Cycle (IPLC) • Stage 0--Local Innovation • Stage 1--Overseas Innovation • Stage 2--Maturity • Stage 3--Worldwide Imitation • Stage 4--Reversal

  9. Product Standardization vs. Product Adaptation • Arguments for Standardization - simplicity and cost - consistent company or product image - musical recordings and works of art - industry specifications - cultural universals

  10. Product Standardization vs. Product Adaptation • Arguments for Adaptation - big-car syndrome - left-hand-drive syndrome

  11. Mandatory Product Modification • Government regulations • Electrical current standards • Measurement systems • Operating systems

  12. Optional Product Modification • Physical distribution • Local use conditions • Climatic conditions • Space constraint • Consumer demographics as related to physical appearance

  13. Optional Product Modification • User's habits • Environmental characteristics • Price • Limiting product movement across national borders (gray marketing) • Historical preference or local customs and culture

  14. International Product Strategies • Standardized Product • Domestic product introduced internationally, with minor or no modification • Efficient but not effective • Localized Product - Domestic product adapted for foreign markets • Product designed specifically for foreign markets • Effective but not efficient

  15. International Product Strategies • Global Product - Product designed with international (not national) markets in mind - Product having universal features • Product being adaptation-ready, when necessary • Both efficient and effective

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