PowerPoint Slides to accompany Rix Marketing: A Practical Approach 7e

1. PowerPoint Slides to accompany Rix Marketing: A Practical Approach 7e

2. What is a Product? • Core product = ability to satisfy wants • Can capture memories • Opportunity for self-expression • Augmented product • = extras • Brand status and retailer reputation • Before and after-sales service • Warranty • Actual product = what it is and does • Well-made • Light and stylish • Attractive packaging Rix Marketing: A Practical Approach 7e Next: Classifying Consumer GoodsChapter Seven: Product Planning and Development Learn more on pages 239 – 241

3. Classifying Consumer Goods Categorising products can help guide product management strategies • Convenience goods • Groceries, snack foods, socks/undies, stationary • Low unit value • Usually frequently purchased • Low involvement in brand or price comparison • Substitute readily accepted All elements of the marketing mix are important, but which of the four Ps is critical for convenience goods? Place (distribution): because if our brand is not on the shelf, the consumer will readily accept a substitute. Rix Marketing: A Practical Approach 7e Next: Classifying Consumer GoodsChapter Seven: Product Planning and Development Learn more on pages 242 - 246

4. Classifying Consumer Goods • Shopping goods • White goods, most cars, furnishings, clothing • Higher unit value • Less frequently purchased • Consumer compares price and other features Which element(s) of the four Ps is critical if we are marketing shopping goods? Price: because consumers shop around for the best deal, and Promotion: especially combined manufacturer and retailer promotions Rix Marketing: A Practical Approach 7e Next: Classifying Consumer GoodsChapter Seven: Product Planning and Development Learn more on pages 242 - 246

5. Classifying Consumer Goods • Specialty goods • Luxury items, specialty stereo, unique cars • Usually high unit value • Very high involvement in purchase • Very high brand or outlet loyalty Which element of the four Ps is critical if we are marketing specialty goods? Product: because the quality, style or brand is what has made the product a sought-after specialty good Rix Marketing: A Practical Approach 7e Next: Classifying Consumer GoodsChapter Seven: Product Planning and Development Learn more on pages 242 - 246

6. Classifying Consumer Goods • Unsought goods • Consumer is not aware of product, or • Consumer has to be shown the need Which element of the four Ps is critical if we are marketing unsought products? Promotion: because consumers are either unaware of the product or don’t actively seek it out. Rix Marketing: A Practical Approach 7e Next: Classifying Business GoodsChapter Seven: Product Planning and Development Learn more on pages 242 - 246

7. Classifying Business Goods • Raw materials • Fabricating materials and parts • Installations • Accessory equipment • Operating supplies Each of these also has some relevance for B2B marketing strategy (See Table 7.1) Rix Marketing: A Practical Approach 7e Next: Classification of ServicesChapter Seven: Product Planning and Development Learn more on pages 246 - 250

8. Classification of Services • B2B v B2C • Extent of physical good involved • Capital investment required • Delivery method • Degree of customer involvement Each of these is relevant for services marketing strategy (See also Chapter 9) Rix Marketing: A Practical Approach 7e Next: Developing New ProductsChapter Seven: Product Planning and Development Learn more on pages 250 - 251

9. Developing New Products 3. Business analysis 4. Product prototype development 5. Test marketing 6. Commercialisation 2. Screening and evaluation of ideas Identify the strategic role of the new products 1. Idea generation CONCEPT TESTING Rix Marketing: A Practical Approach 7e Next: New Product Adoption and DiffusionChapter Seven: Product Planning and Development Learn more on pages 252 - 259

10. New Product Adoption and Diffusion Success with a new line is more likely if three aspects of the adoption process are understood Stages consumers go through in adopting a new line Types of consumers who adopt new products early or late Factors affecting the adoption rate of a new product Rix Marketing: A Practical Approach 7e Next: Stages in the Adoption ProcessChapter Seven: Product Planning and Development Learn more on page 260

11. Stages in the Adoption Process Awareness Consumer is exposed to the new line 2. Interest Consumer looks for information 3. Evaluation Consumer compares the new line to alternatives 4. Trial Consumer buys one or tries a sample 5. Adoption Consumer buys on a regular basis 6. Post-adoption confirmation Consumer looks for re-assurance in ads or others’ opinions Rix Marketing: A Practical Approach 7e Next: Adopter CategoriesChapter Seven: Product Planning and Development Learn more on page 260

12. Adopter Categories Consumers adopt products at different stages of its life cycle. Early majority Early adopters Late majority Innovators (very small group) Laggards Marketers target early groups who ‘educate’ other consumers. Rix Marketing: A Practical Approach 7e Next: Innovations Can Have Different Adoption RatesChapter Seven: Product Planning and Development Learn more on page 261

13. Innovations Can Have Different Adoption Rates Rix Marketing: A Practical Approach 7e Next: Factors Affecting the Adoption RateChapter Seven: Product Planning and Development Learn more on page 261

14. Factors Affecting the Adoption Rate 50% market penetration in 2 years 50% market penetration in 20 years Why the difference in adoption rate? • Relative advantage • Compatibility • Complexity • Ability to trail • Ability to observe Rix Marketing: A Practical Approach 7e Next: Product Life CycleChapter Seven: Product Planning and Development Learn more on pages 260 -263

15. Product Life Cycle • Decline • Consider deletion • Cost control is key task • Introduction • Costs high, sales low • Gaining distribution is key task • High risk of product failure • Growth • Sales increasing • Competition increases • Competitive promotion is key task • Maturity • Sales slow • Margins fall • ‘Extra reason to buy’ product improvement and promotion is key task Rix Marketing: A Practical Approach 7e Next: Planned ObsolescenceChapter Seven: Product Planning and Development Learn more on pages 263 269

16. Planned Obsolescence Planning for a product to ‘die’ is a controversial aspect of product management. Two types of obsolescence: • Technological or function obsolescence • New materials • Miniaturisation • Improved functions • Fashion or style obsolescence • Shapes • Colours • Superficial improvements Rix Marketing: A Practical Approach 7e Next: Five Minute Quiz Chapter Seven: Product Planning and Development Learn more on pages 270-271

17. Five Minute Quiz List three categories each of consumer goods and business goods List the steps for developing a new product List the stages in the new product adoption process List five factors than can affect the adoption rate for a new product 5. Briefly outline the stages in the product life cycle Rix Marketing: A Practical Approach 7e Chapter Seven: Product Planning and Development