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Developing the Marketing Mix: Products are either Goods, Services or Experiences. Chapter 8 Self-check questions 1 & 7. Self-Check Question One.
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Developing the Marketing Mix: Products are either Goods, Services or Experiences Chapter 8 Self-check questions 1 & 7
Self-Check Question One Qantas is researching service quality concerning seat allocation tickets with two (0 – 10) Likert-type scale questions for each stage of the customer’s trip – purchasing, check in, in-flight services, baggage claim – and an overall satisfaction question. For example, the check-in question asked about speed of check-in and the courteousness of staff. Completed tickets/questionnaires could be placed in any of the specially marked receptacles on planes and in terminals for a chance to win 5000 Frequent Flyer points. Comment on the possible research findings and their implications for product design.
What is a product? • Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. • It includes physical objects, services, persons, places organisations and ideas.
Products • Many products are in physical form such as cars, toasters, shoes and eggs; they are goods, in the jargon of the economists. • We define products broadly to include tangibles such as services and experiences as well.
Core Products • The basic level of a product
Product Design “Buyers do not buy quarter-inch drills; they buy quarter-inch holes” - - Theodore Levitt
Product Design The next step: • build an actual product (a product’s parts, styling, features, brand name, packaging and other attributes that combine to deliver core product benefits) around the core product.
Product Design Final step: • build an augmented product (additional customer services and benefits built around the core and actual products) around the core and actual products by offering additional consumer services and benefits.
Likert-Type Scale Apsychometric scale commonly involved in research that employs questionnaires. It is the most widely used approach to scaling responses in survey research. For Example…
Possible Research Findings • Some consumers expect higher service levels than others – they may desire more interaction from their frequent flyer program and like to be seated in an aisle seat, and require vegetarian meals in-flight. • Some may expect extra services before their flight in one of the 250 Qantas Club lounges across the world, and so they join the Qantas Club.
Possible Research Findings • Some expect augmentation by way of packaged tours to holiday destinations. • Some like the idea of receiving a bonus in points from flying with Qantas, so they join the airline’s frequent flyer scheme.
Possible Research Findings • For some consumers however, these augmentation elements may not be necessary in meeting their product demands. • Companies may strip away augmentation elements, thus enabling the firm to meet the requirements of market segments seeking value but at lower prices
Self-Check Question 7 Provide an example of a company that has stretched its product line both upwards and downwards.
Stretching the product line • Stretching the product line both up and down is considered as two way stretching. • Two-way stretching means that the company is extending their product lines upwards and downwards to address different segments of the market. • The two way stretch strategy may be adopted by a company that sits in the middle range of a particular product. • Examples of companies that have stretched their product lines are Sony, General Motors-Holden, and Apple.
Sony • Sony introduced its first Walkman in the middle of the market. • As lower-market products moved in, so did Sony by stretching their product line down-ward with cheaper models of the original Walkman. • At the same time, Sony generated a more upmarket version of the Walkman by adding more features such as play-back only, recording options and high-quality playback,thus filling all potential gaps in themarket The original Sony Walkman
General Motors-Holden General Motors-Holden has stretched its product line by introducing a line of cars that suit every income and every budget. Holden currently offers customers: The Barina- Low priced car The Commodore- Family car The Statesman- Luxury car
Apple Another company that has stretched their product line is apple. Apple currently offer customers: