Marketing decision

&P.L.C.

Making Marketing Decisions

Price

Promotion

Place

People

Process

Physical Environment

Stages of the New ProductDevelopment Process

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Stages of the New ProductDevelopment Process

•Stage 1:Idea Generation– Internal idea sources:

•R & D

– External idea sources:•Customers, competitors, distributors, suppliers

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Intuit, a marketer of financial software, asks for new product ideas from customers

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Stages of the New ProductDevelopment Process

•STAGE 2: Idea Screening

– Product development costs increase substantially in later stages so poor ideas must be dropped

– Ideas are evaluated against criteria; most are eliminated

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MIT Virtual ResearchMIT has developed online techniques to gain consumer feedback on new

product ideas

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Stages of the New ProductDevelopment Process• Stage 3: Concept Development and Testing

– Concept development creates a detailed version of the idea stated in meaningful consumer terms.

– Concept testing asks target consumers to evaluate product concepts.

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Stages of the New ProductDevelopment Process• Stage 4: Marketing Strategy Development

• The target market, product positioning, and sales, share, and profit goals for the first few years.

• Product price, distribution, and marketing budget for the first year.

• Long-run sales and profit goals and the marketing mix strategy.

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Stages of the New ProductDevelopment Process

•Stage 5: Business Analysis–Sales, cost, and profit projections

•Stage 6: Product Development–Prototype development and testing

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Stages of the New ProductDevelopment Process

•Stage 7: Test Marketing–Standard test markets

–Controlled test markets

–Simulated test markets

•Stage 8: Commercialization

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Stages of the PLC

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Product Life Cycles and the Boston Matrix

Sales

Time

Effects of Extension Strategies

Product Life Cycles and the BostonMatrix

Sales/Profits

Time

PLC and Profits

LossesBreak Even

PLC

Profits