what is the term used to describe product attributes that attract certain

A product is a package of attributes (features, functions, benefits, and uses) that a person receives in an exchange. In essence, the term "product" refers to anything offered by a firm to provide customer satisfaction, tangible or intangible. Thus, a production may be an thought (recycling), a physical good (a pair of sneakers), a service (banking), or whatever combination of the three.^[i]

Broadly speaking, products fall into 1 of two categories: consumer products and business products (also called industrial products and B2B products). Consumer products are purchased by the concluding consumer. Business products are purchased by other industries or firms and can be classified asproduction goods—i.east., raw materials or component parts used in the production of the final production—orsupport appurtenances—such as machinery, fixed equipment, software systems, and tools that aid in the production process.^[2] Some products, like computers, for instance, may exist both consumer products and business concern products, depending on who purchases and uses them.

The product fills an important role in the marketing mix considering it is the core of the substitution. Does the production provide the features, functions, benefits, and uses that the target customer expects and desires? Throughout our word of product we will focus on the target customer. Often companies become excited well-nigh their capabilities, technologies, and ideas and forget the perspective of the customer. This leads to investments in production enhancements or new products that don't provide value to the customer—and, as a event, are unsuccessful.

Consumer products are oft classified into four groups related to different kinds of ownership decisions: convenience, shopping, specialty, and unsought products. These are described below.

A convenience product is an inexpensive product that requires a minimum amount of try on the part of the consumer in order to select and buy it. Examples of convenience products are bread, soft drinks, hurting reliever, and coffee. They also include headphones, power cords, and other items that are hands misplaced.

From the consumer'southward perspective, little time, planning, or effort go into buying convenience products. Often product purchases are fabricated on impulse, and then availability is important. Consumers take come to await a wide variety of products to be conveniently located at their local supermarkets. They as well expect piece of cake online purchase options and depression-cost, quick shipping for those purchases. Convenience items are besides found in vending machines and kiosks.

For convenience products, the primary marketing strategy is all-encompassing distribution. The product must be available in every believable outlet and must be easily accessible in these outlets. These products are normally of depression unit value, and they are highly standardized. Marketers must establish a high level of make awareness and recognition. This is achieved through extensive mass advertising, sales promotion devices such equally coupons and point-of-purchase displays, and effective packaging. Yet, the central is to convince resellers (wholesalers and retailers) to carry the production. If the production is not available when, where, and in a course the consumer desires, the convenience product will neglect.

In dissimilarity, consumers want to exist able to compare products categorized equally shopping products. Shopping products are ordinarily more expensive and are purchased occasionally. The consumer is more than probable to compare a number of options to assess quality, cost, and features.

Although many shopping goods are nationally advertised, in the marketing strategy information technology is ofttimes the ability of the retailer to differentiate itself that generates the sale. If you decide to buy a TV at BestBuy, then you lot are more than likely to evaluate the range of options and prices that BestBuy has to offer. It becomes important for BestBuy to provide a knowledgeable and constructive sales person and take the right pricing discounts to offer y'all a competitive bargain. BestBuy might likewise offer you an extended warranty parcel or in-store service options. While shopping in BestBuy, consumers can easily cheque prices and options for online retailers, which places even greater pressure on BestBuy to provide the best total value to the shopper. If the retailer can't make the sale,  production turnover is slower, and the retailer will have a great deal of their upper-case letter tied upward in inventory.

There is a distinction between heterogeneous and homogeneous shopping products. Heterogeneous shopping products are unique. Think near shopping for clothing or furniture. There are many stylistic differences, and the shopper is trying to find the all-time stylistic match at the right price. The buy decision with heterogeneous shopping products is more likely to be based on finding the right fit than on toll alone.

In contrast, homogeneous shopping products are very similar. Have, for instance, refrigerators. Each model has sure features that are bachelor at different price points, only the basic functions of all of the models are very similar. A typical shopper volition await for the lowest price available for the features that they desire.

Specialty goods stand for the third product classification. From the consumer's perspective, these products are so unique that it'southward worth it to go to corking lengths to find and buy them. Almost without exception, price is non the principle factor affecting the sales of specialty goods. Although these products may exist custom-made or ane-of-a-kind, it is also possible that the marketer has been very successful in differentiating the production in the heed of the consumer.

For example, some consumers experience a strong zipper to their hair stylist or barber. They are more likely to wait for an engagement than schedule time with a different stylist.

Another example is the annual Blizzcon outcome produced by Blizzard Amusement. The $200 tickets sell out minutes after they are released, and they are resold at a premium. At the issue, attendees go the take a chance to larn about new video games and play games that have non yet been released. They can also purchase limited-edition promotional items. From a marketer's perspective, in Blizzcon the company has succeeded in creating a specialty product that has incredibly loftier demand. Moreover, Blizzard's customers are paying for the opportunity to be role of a massive marketing consequence.

It is more often than not desirable for a marketer to elevator her product from the shopping to the specialty class—and go on it there. With the exception of price-cutting, the entire range of marketing activities is needed to reach this.

Unsought products are those the consumer never plans or hopes to buy. These are either products that the customer is unaware of or products the consumer hopes not to need. For example, nigh consumers hope never to buy pest command services and try to avert purchasing funeral plots. Unsought products have a trend to draw aggressive sales techniques, as it is difficult to get the attention of a buyer who is non seeking the product.

As nosotros get-go our exploration of brand and its role in marketing, take a few minutes to watch the following video about Coca-Cola, which isperhaps one of the most iconic brands of all time. Every bit you watch this video, look and heed for the all the different elements that contribute to the matter nosotros call a "brand."

Brands are interesting, powerful concoctions of the marketplace that create tremendous value for organizations and for individuals. Considering brands serve several functions, we tin can ascertain the term "brand" in the following ways:

1. A brand is an identifier: a name, sign, symbol, design, term, or some combination of these things that identifies an offering and helps simplify pick for the consumer.
2. A brand is a promise: the promise of what a visitor or offering will provide to the people who interact with information technology.
3. A brand is an asset: a reputation in the marketplace that can drive price premiums and customer preference for goods from a particular provider.
4. A make is a set of perceptions: the sum total of everything individuals believe, think, see, know, feel, hear, and experience most a production, service, or system.
5. A make is "mind share": the unique position a visitor or offering holds in the customer'southward mind, based on their by experiences and what they await in the future.

A brand consists of all the features that distinguish the goods and services of one seller from some other: proper noun, term, blueprint, style, symbols, customer touch on points, etc. Together, all elements of the brand work as a psychological trigger or stimulus that causes an association to all other thoughts ane has had about this brand.

Brands are a combination of tangible and intangible elements, such as the following:

• Visual design elements (i.due east., logo, color, typography, images, tagline, packaging, etc.)
• Distinctive product features (i.e. quality, blueprint sensibility, personality, etc.)
• Intangible aspects of customers' experience with a product or visitor (i.e. reputation, customer feel, etc.)

Branding–the act of creating or edifice a brand–may take place at multiple levels: visitor brands, individual production brands, or branded product lines. Any entity that works to build consumer loyalty can also exist considered a make, such as celebrities (Lady Gaga, e.1000.), events (Susan One thousand. Komen Race for the Cure, e.g.), and places (Las Vegas, east.chiliad.).

Brands Create Marketplace Perceptions

A successful brand is much more than than simply a proper noun or logo. As suggested in one of the definitions above, brand is the sum of perceptions virtually a company or product in the minds of consumers. Effective brand building can create and sustain a strong, positive, and lasting impression that is difficult to readapt. Brands provide external cues to taste, design, functioning, quality, value, or other desired attributes if they are developed and managed properly. Brands convey positive or negative messages near a company, product, or service. Brand perceptions are a directly event of past advertising, promotion, product reputation, and customer experience.

A brand can convey multiple levels of meaning, including the following:

As an automobile brand, the Mercedes-Benz logo suggests high prestige.

1. Attributes: specific product features. The Mercedes-Benz brand, for example, suggests expensive, well-built, well-engineered, durable vehicles.
2. Benefits: attributes translate into functional and emotional benefits. Mercedes automobiles suggest prestige, luxury, wealth, reliability, cocky-esteem.
3. Values: visitor values and operational principles. The Mercedes brand evokes company values effectually excellence, high performance, power.
4. Culture: cultural elements of the visitor and brand. Mercedes represents German precision, discipline, efficiency, quality.
5. Personality: strong brands oftentimes projection a distinctive personality. The Mercedes brand personality combines luxury and efficiency, precision and prestige.
6. User: brands may advise the types of consumers who buy and utilize the production. Mercedes drivers might exist perceived and classified differently than, for instance, the drivers of Cadillacs, Corvettes, or BMWs.

Brands Create an Experience

Constructive branding encompasses everything that shapes the perception of a company or product in the minds of customers. Names, logos, brand marks, trade characters, and trademarks are usually associated with make, but these are just part of the film. Branding also addresses well-nigh every aspect of a customer's feel with a visitor or product: visual blueprint, quality, distinctiveness, purchasing feel, customer service, and so forth. Branding requires a deep knowledge of customers and how they experience the company or product. Brand-building requires long-term investment in communicating almost and delivering the unique value embodied in a company's "brand," but this effort tin can bring long-term rewards.

In consumer and concern-to-business organization markets, branding can influence whether consumers will purchase the product and how much they are willing to pay. Branding can also help in new product introduction by creating meaning, market place perceptions, and differentiation where nothing existed previously. When companies introduce a new product using an existing brand name (a brand extension or a branded product line), they tin build on consumers' positive perceptions of the established make to create greater receptivity for the new offering.

The Dunkin' Donuts logo, which includes an image of a DD loving cup of coffee, makes information technology easy to spot anywhere. The coffee is known for beingness a good value at a not bad price.

Brands create value for consumers and organizations in a variety of ways.

Value of Branding for the Consumer

Brands assist simplify consumer choices. Brands help create trust, and so that a person knows what to await from a branded visitor, product, or service. Effective branding enables the consumer to easily place a desirable company or product because the features and benefits have been communicated effectively. Positive, well-established make associations increase the likelihood that consumers volition select, purchase, and swallow the product. Dunkin' Donuts, for example, has an established logo and imagery familiar to many U.S. consumers. The bright colors and image of a DD loving cup are hands recognized and distinguished from competitors, and many associate this brand with tasty donuts, adept coffee, and great prices.

Value of Branding for Product and Service Providers

The Starbucks brand is associated with premium, high-priced java.

For companies and other organizations that produce goods, branding helps create loyalty. It decreases the risk of losing market share to the competition by establishing a competitive advantage customers tin can count on. Stiff brands often command premium pricing from consumers who are willing to pay more than for a product they know, trust, and perceive as offer good value. Branding tin can exist a great vehicle for effectively reaching target audiences and positioning a visitor relative to the competition. Working in conjunction with positioning, brand is the ultimate touchstone to guide choices effectually messaging, visual blueprint, packaging, marketing, communications, and production strategy.

For example, Starbucks' loyal fan base values and pays premium prices for its java. Starbucks' choices about drinkable products, neighborhood shops, the ownership experience, and corporate social responsibility all help build the Starbucks brand and communicate its value to a global customer base.

Value of Branding for the Retailer

Retailers such as Target, Safeway, and Walmart create brands of their ain to create a loyal base of operations of customers. Branding enables these retailers to differentiate themselves from one another and build client loyalty around the unique experiences they provide. Retailer make building may focus effectually the in-shop or online shopping environment, production option, prices, convenience, personal service, client promotions, product display, etc.

Retailers also benefit from carrying the branded products customers want. Brand-marketing support from retailers or manufacturers tin aid concenter more customers (ideally ones who normally don't frequent an establishment). For example, a customer who truly values organic brands might decide to visit a Babies R United states of america to store for organic household cleaners that are safe to utilise around babies. This client might accept learned that a company called BabyGanics, which brands itself every bit making "safe, constructive, natural household solutions," was only bachelor at this item retailer.

Branding Strategies

Managing Brands As Strategic Avails

As organizations institute and build potent brands, they can pursue a number of strategies to continue developing them and extending their value to stakeholders (customers, retailers, supply chain and distribution partners, and of course the organization itself).

Brand Ownership

Steve Jobs, co-founder and CEO of Apple

Who "owns" the brand? The legal owner of a brand is more often than not the individual or entity in whose name the legal registration has been filed. Operationally speaking, brand ownership should be the responsibleness of an organisation's direction and employees. Brand buying is near building and maintaining a brand that reflects your principles and values. Make building is well-nigh finer persuading customers to believe in and purchase your product or service. Iconic brands, such as Apple tree and Disney, oft have a history of visionary leaders who champion the make, evangelize about it, and build information technology into the organizational culture and operations.

Types of Branding Strategies

A branding strategy helps constitute a product inside the market and to build a brand that will grow and mature. Making smart branding decisions upward front end is crucial since a company may have to live with their decisions for a long time. The following are commonly used branding strategies:

"Branded House" Strategy

A "branded firm" strategy (sometimes called a "business firm brand") uses a potent brand—typically the company name—as the identifying brand proper noun for a range of products (for example, Mercedes Benz or Black & Decker) or a range of subsidiary brands (such as Cadbury Dairy Milk or Cadbury Fingers). Considering the primary focus and investment is in a unmarried, dominant "firm" brand, this approach tin be simpler and more than cost effective in the long run when it is well aligned with broader corporate strategy.

"House of Brands" Strategy

Kool-Aid Human

With the "house of brands" strategy, a company invests in building out a variety of individual, product-level brands. Each of these brands has a separate proper noun and may not be associated with the parent company name at all. These brands may fifty-fifty be in de facto contest with other brands from the same company. For instance, Kool-Assistance and Tang are 2 powdered beverage products, both endemic past Kraft Foods. The "house of brands" strategy is well suited to companies that operate across many product categories at the aforementioned time. It allows greater flexibility to introduce a diversity of different products, of differing quality, to be sold without confusing the consumer's perception of what concern the company is in or diluting brand perceptions virtually products that target unlike tiers or types of consumers inside the same product category.

Private-Label or Store Branding

Too called shop branding, private-label branding has get increasingly popular. In cases where the retailer has a especially potent identity, the private characterization may be able to compete confronting fifty-fifty the strongest brand leaders and may outperform those products that are not otherwise strongly branded. The northeastern U.Due south. grocery chain Wegman's offers many grocery products that carry the Wegman's brand name. Meanwhile national grocery concatenation Safeway offers several unlike private characterization "shop" brands: Safeway Select, Organics, Signature Buffet, and Primo Taglio, amid others.^[3]

"No-Brand" Branding

A number of companies successfully pursue "no-brand" strategies past creating packaging that imitates generic-brand simplicity. "No make" branding can be considered a type of branding since the product is fabricated conspicuous by the absence of a make name. "Tapa Amarilla" or "Yellow Cap" in Venezuela during the 1980s is a prime example of no-make strategy. Information technology was recognized only by the colour of the cap of this cleaning products visitor.

Personal and Organizational Brands

Personal and organizational branding are strategies for developing a make image and marketing engine around individual people or groups. Personal branding treats persons and their careers as products to be branded and sold to target audiences. Organizational branding promotes the mission, goals, and/or piece of work of the group being branded. The music and entertainment industries provide many examples of personal and organizational branding. From Justin Bieber to George Clooney to Kim Kardashian, virtually whatever celebrity today is a personal brand. Likewise, bands, orchestras, and other artistic groups typically cultivate an organizational (or group) brand. Faith branding is a variant of this brand strategy, which treats religious figures and organizations equally brands seeking to increment their following. Mission-driven organizations such the Girl Scouts of America, the Sierra Club, the National Rifle Association (among millions of others) pursue organizational branding to expand their membership, resources, and touch.

Place Branding

The developing fields of place branding and nation branding piece of work on the assumption that places compete with other places to win over people, investment, tourism, economic development, and other resource. With this in listen, public administrators, borough leaders, and business groups may team up to "brand" and promote their city, region, or nation among target audiences. Depending on the goals they are trying to achieve, targets for these marketing initiatives may be real-estate developers, employers and business investors, tourists and tour/travel operators, and and then along. While place branding may focus on any given geographic area or destination, nation branding aims to measure, build, and manage the reputation of countries.

The city-country Singapore is an early, successful example of nation branding. The edgy Las Vegas "What Happens Here, Stays Here" campaign, shown in in the post-obit video, is a well-known example of place branding.

Co-Branding

Co-branding is an arrangement in which 2 established brands interact to offering a single product or service that carries both brand names. In these relationships, mostly both parties contribute something of value to the new offering that neither would accept been able to achieve independently. Effective co-branding builds on the complementary strengths of the existing brands. It tin also allow each brand an entry signal into markets in which they would not otherwise be credible players.

The following are some examples of co-branded offerings:

• Delta Airlines and American Express offer an entire family unit of co-branded credit cards; other airlines offer similar co-branded cards that offer customer rewards in terms of frequent flyer points and special offers.

  

  Fiat 500 "Barbie"

• Habitation furnishings visitor Pottery Befouled and the pigment manufacturer Benjamin Moore co-make seasonal color palettes for home interior paints
• Fashion designer Liz Lange designs a ready-to-habiliment clothing line co-branded with and sold exclusively at Target stores
• Motorcar maker Fiat and toy maker Mattel teamed upwards to celebrate Barbie'due south fiftieth anniversary with the boom-smooth-pink Fiat 500 Barbie car.

Co-branding is a common brand-edifice strategy, but it tin present difficulties. There is ever take chances effectually how well the marketplace will receive new offerings, and sometimes, despite the best-laid plans, co-branded offerings fall flat. Also, these arrangements often involve complex legal agreements that are difficult to implement. Co-branding relationships may be unevenly matched, with the partners having unlike visions for their collaboration, placing different priority on the importance of the co-branded venture, or one partner holding significantly more power than the other in determining how they work together. Considering co-branding impacts the existing brands, the partners may struggle with how to protect their current brands while introducing something new and possibly risky.

Brand Licensing

Campbell's "Star Wars" Soup. Source: http://www.campbells.com/star-wars/

Brand licensing is the process of leasing or renting the right to use a brand in association with a product or set of products for a divers period and inside a defined market, geography, or territory. Through a licensing agreement, a firm (licensor) provides some tangible or intangible nugget to some other firm (licensee) and grants that house the right to use the licensor's brand proper name and related brand assets in return for some payment. The licensee obtains a competitive advantage in this arrangement, while the licensor obtains inexpensive admission to the market in question.

Licensing tin can be extremely lucrative for the owner of the brand, equally other organizations pay for permission to produce products carrying a licensed name. The Walt Disney Company was an early pioneer in make licensing, and it remains a leader in this expanse with its wildly popular entertainment and toy brands: Star Wars, Disney Princesses, Toy Story, Mickey Mouse, and so on. Toy manufacturers, for example, pay millions of dollars and vie for the rights to produce and sell products affiliated with these "super-brands."

Line Extensions and Make Extensions

Organizations use line extensions and brand extensions to leverage and increase brand equity.

Nutrition Coke is a line extension of the Coke brand.

A visitor creates a line extension when it introduces a new variety of offer within the same production category. To illustrate with the food industry, a visitor might add new flavors, package sizes, nutritional content, or products containing special additives in line extensions. Line extensions aim to provide more variety and hopefully capture more of the marketplace within a given category. More than half of all new products introduced each year are line extensions. For example, G&Yard candy varieties such as peanut, pretzel, peanut butter, and dark chocolate are all line extensions of the Thousand&Yard brand. Diet Coke™ is a line extension of the parent make Coke ™. While the products have distinct differences, they are in the aforementioned production category.

A brand extensionmoves an existing brand proper noun into a new product category, with a new or somehow modified product. In this scenario, a company uses the strength of an established product to launch a product in a different category, hoping the popularity of the original brand volition increase receptivity of the new production. An example of a brand extension is the offering of Jell-O pudding pops in addition to the original product, Jell-O gelatin. This strategy increases awareness of the brand proper noun and increases profitability from offerings in more than i product category.

Line extensions and make extensions are important tools for companies because they reduce fiscal risk associated with new-production development by leveraging the equity in the parent brand name to enhance consumers' perceptions and receptivity towards new products. Due to the established success of the parent brand, consumers volition have instant recognition of the product proper name and be more probable to try the new line extension.

Stages of the Production Life Bike

A company has to exist proficient at both developing new products and managing them in the face up of changing tastes, technologies, and competition. Products generally go through a life bike with anticipated sales and profits. Marketers use the product life cycle to follow this progression and identify strategies to influence information technology. The product life bicycle (PLC) starts with the product's development and introduction, and then moves toward withdrawal or eventual demise. This progression is shown in the graph, below.

The five stages of the PLC are:

1. Product evolution
2. Market introduction
3. Growth
4. Maturity
5. Turn down

The tabular array below shows common characteristics of each stage.

	Common Characteristics
0. Product development  stage	investment is made sales have not begun new production ideas are generated, operationalized, and tested
1. Market introduction stage	costs are very loftier boring sales volumes to offset picayune or no contest demand has to be created customers have to be prompted to try the product makes niggling money at this stage
2. Growth stage	costs reduced due to economies of scale sales book increases significantly profitability begins to rise public awareness increases contest begins to increase with a few new players in establishing market increased competition leads to price decreases
three. Maturity phase	costs are lowered as a result of increasing product volumes and experience curve effects sales volume peaks and marketplace saturation is reached new competitors enter the market prices tend to drib due to the proliferation of competing products brand differentiation and characteristic diversification is emphasized to maintain or increment market share profits turn down
4. Refuse stage	costs increment due to some loss of economies of scale sales volume declines prices and profitability diminish profit becomes more a challenge of production/distribution efficiency than increased sales

Using the Product Life Bike

The production life bike can be a useful tool in planning for the life of the product, but information technology has a number of limitations.

Not all products follow a smooth and predictable growth path. Some products are tied to specific business cycles or have seasonal factors that touch growth. For example, enrollment in higher didactics tracks closely with economic trends. When there is an economical downturn, more people lose jobs and enroll in higher to meliorate their job prospects. When the economy improves and more than people are fully employed, college enrollments drop. This does not necessarily mean that education is in refuse, just that it is in a down bike.

Furthermore, evidence suggests that the PLC framework holds true for manufacture segments just non necessarily for individual brands or projects, which are likely to experience greater variability.^[4]

Of course, changes in other elements of the marketing mix can also affect the performance of the product during its life bicycle. Modify in the competitive situation during each of these stages may have a much greater impact on the marketing arroyo than the PLC itself. An effective promotional programme or a dramatic lowering of price may improve the sales moving-picture show in the decline menstruum, at to the lowest degree temporarily. Usually the improvements brought about by not-product tactics are relatively short-lived, and bones alterations to product offerings provide longer benefits.

Whether one accepts the Southward-shaped bend as a valid sales pattern or as a design that holds only for some products (only not for others), the PLC concept tin can nevertheless be very useful. Information technology offers a framework for dealing systematically with product marketing issues and activities. The marketer needs to be enlightened of the generalizations that apply to a given product equally it moves through the diverse stages.

Marketing through the Product Cycle

There are some common marketing considerations associated with each stage of the PLC. How marketers think about the marketing mix and the blend of promotional activities–besides known every bit the promotion mix–should reflect a product'due south life-cycle stage and progress toward market adoption. These considerations cannot be used equally a formula to guarantee success, just they can function as guidelines for thinking about budget, objectives, strategies, tactics, and potential opportunities and threats.

Proceed in mind that we will discuss the new-product evolution procedure next, so it is not covered hither.

Market Introduction Stage

Call back of the marketplace introduction stage as the product launch. This phase of the PLC requires a significant marketing budget. The market is non still aware of the product or its benefits. Introducing a product involves convincing consumers that they take a problem or demand which the new offering can uniquely address. At its core, messaging should convey, "This product is a great idea! You want this!"  Usually a promotional budget is needed to create broad awareness and educate the market almost the new product. To achieve these goals, frequently a product launch includes promotional elements such as a new Spider web site (or significant update to the existing site), a press release and printing campaign, and a social media entrada.

There is also a need to invest in the development of the distribution channels and related marketing support. For a B2B product, this often requires training the sales force and developing sales tools and materials for direct and personal selling. In a B2C market, it might include training and incentivizing retail partners to stock and promote the product.

Pricing strategies in the introduction phase are generally set up fairly high, equally at that place are fewer competitors in the market. This is often offset by early discounts and promotional pricing.

Google Drinking glass

It is worth noting that the launch will wait different depending on how new the product is. If the production is a completely new innovation that the market has not seen before, then there is a need to both educate the market about the new offering and build awareness of it. In 2013 when Google launched Google Glass—an optical caput-mounted computer display—it had non just to become the word out about the product but also help prospective buyers sympathise what information technology was and how it might exist used. Google initially targeted tech-savvy audiences near interested in novelty and innovation (more virtually them later when we hash out diffusion of innovation). By offer the new product with a lot of media fanfare and express availability, Google'south promotional strategy ignited demand among these segments. Tech bloggers and insiders blogged and tweeted about their Google Glass adventures, and give-and-take-of-mouth sharing about the new product spread rapidly. You lot can imagine that this was very different from the launch of Wheat Thins Spicy Buffalo crackers, an extension of an existing product line, targeting a different audiences (retailers, consumers) with promotional activities that fit the production's marketing and distribution channels. The Google Glass situation was also different from the launch of Tesla's dwelling house battery. In that case Tesla offered a new line of home products from a company that had previously only offered automobiles. Breaking into new product categories and markets is challenging even for a well-regarded company like Tesla. As you might wait, the greater the difference in new products from a company's existing offerings, the greater the complexity and expense of the introduction stage.

Ane other consideration is the maturity of the product. Sometimes marketers volition cull to exist conservative during the marketing introduction phase when the product is not yet fully developed or proven, or when the distribution channels are not well established. This might mean initially introducing the production to merely one segment of the market, doing less promotion, or limiting distribution (as with Google Glass). This arroyo allows for early customer feedback but reduces the take chances of product bug during the launch.

While we oft remember of an introduction or launch as a single event, this stage can last several years. Generally a product moves out of the introduction stage when it begins to run across rapid growth, though what counts every bit "rapid growth" varies significantly based on the production and the market.

Growth Stage

In one case rapid growth begins, the product or manufacture has entered the growth stage. When a product category begins to demonstrate significant growth, the market normally responds: new competitors enter the market, and larger companies acquire high-growth companies and products.

These emerging competitive threats drive new marketing tactics. Marketers who have been seeking to build wide market awareness through the introduction stage must now differentiate their products from competitors, emphasizing unique features that entreatment to target customers. The primal thrust of market messaging and promotion during this stage is "This brand is the best!" Pricing also becomes more competitive and must exist adjusted to align with the differentiation strategy.

Often in the growth phase the marketer must pay significant attention to distribution. With a growing number of customers seeking the product, more distribution channels are needed. Mass marketing and other promotional strategies to reach more customers and segments start to brand sense for consumer-focused markets during the growth stage. In business organisation-to-business markets, personal selling and sales promotions often help open doors to broader growth. Marketers often must develop and support new distribution channels to meet demand. Through the growth phase, distribution partners will become more experienced selling the production and may require less back up over fourth dimension.

The master challenges during the growth phase are to identify a differentiated position in the market place that allows the production to capture a meaning portion of the demand and to manage distribution to meet the demand.

Maturity Stage

When growth begins to plateau, the product has reached the maturity phase. In order to attain strong concern results through the maturity stage, the company must have reward of economies of scale. This is usually a menses in which marketers manage upkeep carefully, often redirecting resource toward products that are earlier in their life bike and have higher revenue potential.

At this phase, organizations are trying to extract as much value from an established product as they tin can, typically in a very competitive field. Marketing messages and promotions seek to remind customers about a great product, differentiate from competitors, and reinforce brand loyalty: "Remember why this brand is the best." As mentioned in the previous section, this late in the life cycle, promotional tactics and pricing discounts are likely to provide only short-term benefits. Changes to production have a amend chance of yielding more sustained results.

In the maturity stage, marketers oft focus on niche markets, using promotional strategies, messaging, and tactics designed to capture new share in these markets. Since in that location is no new growth, the accent shifts from drawing new customers to the market to winning more than of the existing market. The visitor may extend a product line, adding new models that have greater entreatment to a smaller segment of the market.

Often, distribution partners will reduce their accent on mature products. A sales forcefulness volition shift its focus to new products with more growth potential. A retailer will reallocate shelf space. When this happens the manufacturer may need to accept on a stronger role in driving demand.

We have repeatedly seen this tactic in the soft drink industry. As the market has matured, the number of different flavors of big brands like Coke and Pepsi has grown significantly. We will look at other product tactics to extend the growth phase and manage the maturity phase in the side by side department.

Pass up Stage

Once a product or industry has entered decline, the focus shifts almost entirely to eliminating costs. Fiddling if any marketing spending goes into products in this life stage, because the marketing investment is better spent on other priorities. For goods, distributors volition seek to eliminate inventory by cut prices. For services, companies will reallocate staff to ensure that commitment costs are in check. Where possible, companies may initiate a planned obsolescence process. Usually engineering companies volition announce to customers that they will not go on to back up a production after a gear up obsolescence engagement.

Oftentimes a primary focus for marketers during this stage is to transition customers to newer products that are earlier in the production life cycle and take more favorable economics. Promotional activities and marketing communications, if whatever, typically focus on making this transition successful among make-loyal segments who still desire the old product. A typical theme of marketing activity is "This familiar brand is still here, but at present at that place'south something even better."

Overview of the New-Product Evolution Process

Introduction

There are probably as many varieties of new-product development systems equally there are types of companies, but about of them share the same basic steps or stages—they are just executed in different means. Beneath, nosotros have divided the process into eight stages, grouped into three phases.  Many of the activities are performed repeatedly throughout the procedure, but they become more concrete as the product thought is refined and additional data are gathered. For example, at each stage of the process, the product squad is asking, "Is this a viable production concept?" but the answers change as the product is refined and more marketplace perspectives tin exist added to the evaluation.

Phase I: Generating and Screening Ideas	Stage Two: Developing New Products	Phase III: Commercializing New Products
Stage i: Generating New Product Ideas	Stage 4: Business concern Instance Analysis	Stage 6: Test Marketing
Stage 2: Screening Product Ideas	Stage 5: Technical and Marketing Development	Stage 7: Launch
Stage 3: Concept Evolution and Testing

Stage i: Generating New Product Ideas

Generating new production ideas is a creative chore that requires a particular way of thinking. Coming up with ideas is easy, just generating proficient ideas is some other story. Companies utilize a range of internal and external sources to place new product ideas. A SWOT assay might suggest strengths in existing products that could exist the ground for new products or marketplace opportunities. Research might identify market and customer trends. A competitive analysis might expose a pigsty in the company's product portfolio. Customer focus groups or the sales team might place unmet customer needs. Many amazing products are also the upshot of lucky mistakes—product experiments that don't meet the intended goal but have an unintended and interesting application. For example, 3M scientist Dr. Spencer Silver invented Post-Information technology Notes in a failed experiment to create a super-strong adhesive.^[5]

The fundamental to the idea generation phase is to explore possibilities, knowing that nearly will not issue in products that go to market.

Stage 2: Screening Product Ideas

The 2d stage of the product development procedure is idea screening. This is the first of many screening points. At this early stage much is non known about the product and its marketplace opportunity. Still, product ideas that do non meet the organization'south objectives should be rejected at this stage. If a poor product idea is allowed to laissez passer the screening stage, it wastes endeavour and money in later stages until it is abandoned. Even more serious is the possibility of screening out a worthwhile thought and missing a pregnant market opportunity. For this reason, this early on screening stage allows many ideas to motion forward that may not eventually go to marketplace.

At this early phase, product ideas may just be screened through some sort of internal rating process. Employees might rate the product ideas according to a set up of criteria, for example; those with depression scores are dropped and only the highest ranked products movement frontwards.

Stage 3: Concept Evolution and Testing

Today, it is increasingly common for companies to run some small concept test in a existent marketing setting. The product concept is a synthesis or a description of a production idea that reflects the core chemical element of the proposed product. Marketing tries to have the most accurate and detailed product concept possible in club to become accurate reactions from target buyers.  Those reactions can then be used to inform the final product, the marketing mix, and the business analysis.

New tools for technology and product development are bachelor that support the rapid evolution of prototypes which can be tested with potential buyers. When concept testing tin can include an bodily product prototype, the early examination results are much more than reliable. Concept testing helps companies avert investing in bad ideas and at the aforementioned fourth dimension helps them take hold of and keep outstanding production ideas.

Phase iv: Business Instance Analysis

Before companies make a significant investment in a product's evolution, they need to be sure that it will bring a sufficient render.

The company seeks to answer such questions every bit the post-obit:

1. What is the market place opportunity for this production?
2. What are the costs to bring the production to market place?
3. What are the costs through the stages of the product life bicycle?
4. Where does the product fit in the product portfolio and how will it affect existing production sales?
5. How does this product impact the brand?
6. How does this product impact other corporate objectives such equally social responsibility?

The marketing upkeep and costs are ane element of the concern assay, but the full telescopic of the analysis includes all revenues, costs, and other business impacts of the product.

Stage 5: Technical and Marketing Development

A production that has passed the screening and business analysis stages is ready for technical and marketing development. Technical development processes vary greatly according to the type of product. For a production with a complex manufacturing process, there is a lab phase to create specifications and an equally circuitous stage to develop the manufacturing procedure. For a service offering, there may exist new processes requiring new employee skills or the commitment of new equipment. These are only two of many possible examples, but in every case the company must ascertain both what the product is and how it will be delivered to many buyers.

While the technical development is under way, the marketing department is testing the early product with target customers to find the all-time possible marketing mix. Ideally, marketing uses product prototypes or early on production models to understand and capture customer responses and to place how best to present the product to the market. Through this process, product marketing must fix a complete marketing plan—one that starts with a statement of objectives and ends with a coherent picture of product distribution, promotion, and pricing integrated into a program of marketing activity.

Stage 6: Exam Marketing and Validation

Test marketing is the final stage before commercialization; the objective is to test all the variables in the marketing plan including elements of the product. Test marketing represents an bodily launching of the total marketing program. All the same, it is done on a express basis.

Initial product testing and exam marketing are non the same. Production testing is totally initiated by the producer: he or she selects the sample of people, provides the consumer with the test product, and offers the consumer some sort of incentive to participate.

Test marketing, on the other mitt, is distinguished by the fact that the test grouprepresents the total market, the consumer must make a buy conclusion and pay for the product, and the test product must compete with the existing products in the actual marketing environment. For these and other reasons, a marketplace exam is an accurate simulation of the broader market and serves as a method for reducing hazard. It should heighten the new product's probability of success and permit for last adjustment in the marketing mix before the product is introduced on a large scale.

Phase 7: Launch

Finally, the product arrives at the commercial launch stage. The marketing mix comes together to introduce the product to the market place. This stage marks the beginning of the production life cycle.

Phase viii: Evaluation

The launch does not in any way signal the end of the marketing role for the production. To the opposite, after launch the marketer finally has real market information near how the production performs in the wild, outside the examination environs. These market place information initiate a new cycle of idea generation about improvements and adjustments that tin can be made to all elements of the marketing mix.

Check Your Agreement

Answer the question(southward) beneath to run into how well yous sympathise the topics covered above. This brusque quiz does not count toward your class in the class, and you can retake it an unlimited number of times.

Use this quiz to check your agreement and decide whether to (1) written report the previous section further or (2) move on to the next section.

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Source: https://courses.lumenlearning.com/wmopen-introbusiness/chapter/product-marketing/

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