mm chap 11,product & product lines
TRANSCRIPT
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 1/30
Product & Product Lines
Chapter 11
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 2/30
Product Personality
Core Features
Associated Features
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 3/30
Nature of the Product
Generic Product
– Unbranded, Plainly Packaged
Expected Product – Contains attributes required by the customers
Augmented Product
– Additional attributes for differntiation Potential Product
– All possible improvements.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 4/30
Product Hierarchy
• PH can be defined as an organisationalchart that depicts the array of productsoffered in a given market.
• In automobile sector levels of producthierarchy are product class & productform.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 5/30
Product Classification.
• Durables.
• Tangible. Consumed over relatively longperiod
• Non durables.
• Tangible. Consumed over short period
• Services
• Intangible. Perishable.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 6/30
• Product can also be classified dependingupon who the final purchaser is & how heuses them.
• They are divided into consumer products& industrial product.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 7/30
Consumer Products
Convenience Products
– Inexpensive, Frequently bought
– Staples & Impulse
Shopping Products – Buyer Time & Effort. Longer life. Less frequent
Purchase.
Specialty Products – Unique characteristic features. Brand, Store or personloyal
Unsought Products
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 8/30
Industrial Products
Raw Materials
Component Parts
Process Material
Capital equipment
Accessory equipment
Consumable supplies
Business Services
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 9/30
Product Policy.
• Product mix is set of all the products thatan organisation offers to its customers.
• Product Width is total number of productlines a company carries.
• HLL offers Confectionaries,ColorCosmetics,Hair Care,Skin care,oralcare,Deodrants,Soaps & Detergent,Toiletsoaps,Beverages,Food.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 10/30
• Product length is total number of items inthat mix.
• The average length of a line is obtained by
dividing total length by the number of linesi.e. 46/10=4.6.
• The depth of a product mix is the
assortment of sizes,colors,& variationoffered,for each product in the productline.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 11/30
• For example Lifebuoy comes in differentsizes.
• Consistency refers to the closeness
exhibited by the product lies in productionrequirements,distributions,etc.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 12/30
• Most of the HLL product lines areconsistent as they are consumergoods,distributed by the same channel of
distribution & are produced in similarmanufacturing plant.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 13/30
• Trading Up:Companies offer higherpriced,prestige products to their existingproduct line in an effort to increase sales
of their low priced products & enhance thecompany’s image.
• Trading down:Companies offer low pricedproduct in order to provide a new productto customer who cannot afford the originalproduct.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 14/30
14
Product Life Cycle
Session-14
Time
S a l
e s
Introduction
GrowthMaturity
Decline
S t a g e o f P L C
o
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 15/30
15
Products like people have a life cycle.
PLC refers to the progression or course of aproduct's sales & profit over its life time.
Product may pass through five stages.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 16/30
16
Product development.
Introduction.
Growth. Maturity.
Decline.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 17/30
17
Product may not pass through all the fivestages.
A product may be developed,introduced &then withdrawn from the market.
A relaunched product will have new life cycle.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 18/30
18
Introduction stage.
At this stage sales is low, promotionalexpenditure is high ,profit is negligible orproduct may not earn any profit at all.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 19/30
19
Strategies for Introduction stage.
Rapid Skimming.
Slow Skimming.
Rapid Penetration. Slow Penetration.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 20/30
20
➲Rapid Skimming
Marketer launches the product at higher price& higher promotional level to skim the marketrapidly.
The strategy is more successful when a largepart of potential market is unaware of theproduct.
The firm tries to build brand preferences.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 21/30
21
Slow Skimming
In this product is launched at higher price &at low promotional level.
This strategy is feasible when market isaware of the product,the market size islimited,competition is not intense& customersare ready to pay higher price.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 22/30
22
Rapid Penetration.
In this product is launched at at lower pricewith heavy promotion.
This strategy is applied when market is largein size ,customer are unaware of theproduct,they are more pricesensitive,competition is high.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 23/30
23
Slow Penetration.
In this product is launched at lower price &low level of promotion.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 24/30
24
Growth Stage.
Rapid Growth in sales.
Rise in profits.
Competition may increase. Unit manufacturing cost falls.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 25/30
25
Strategies for growth stage.
Price cut to attract price sensitive customer.
Introduction of more product features andmodels.
Introduce new marketing channels
Enter new markets.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 26/30
26
Maturity.
Stagnation of sales that is sales growth rateslows down.
The reason could be introduction of newproduct/substitutes,increase competition.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 27/30
27
Strategies for Maturity stage.
Product Modification.
Increase advertising and sales promotion
Attractive promotional scheme. Exit from unprofitable market areas.
Invest more in R & D
New packaging and product re-launch
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 28/30
28
Decline Stage.
During decline stage of PLC sales of aproduct falls rapidly.
The reson could be technologicaladvances,increase in competition,shift's inconsumer's taste & preferences.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 29/30
29
Strategy for decline stage.
Reduce unprofitable products from productline
Cut down promotional budgets and prices
Cut down unprofitable distributors
Reinvent the brand to make it more
appealing. Divest the business through disposal of
asset.
8/3/2019 MM Chap 11,Product & Product Lines
http://slidepdf.com/reader/full/mm-chap-11product-product-lines 30/30