Transcript McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.

McGraw-Hill/Irwin
Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.
Part Three
Business Marketing
Programming
Part Three
Business Marketing Programming
• Chapter 8 Developing and Managing Products
• Chapter 9 Business Marketing Channels
• Chapter 10 Creating Customer Dialogue
• Chapter 11 Communicating via Advertising,
•
•
•
Trade Shows, and PR
Chapter 12 The One-to-One Media
Chapter 13 Sales and Sales Management
Chapter 14 Pricing and Negotiating for Value
Chapter 8
Developing and Managing Offerings:
What do Customers Want?
THE OFFERING CONCEPT
BENEFIT:
How the Product or Service Satisfies
a Need
PRODUCT:
A Bundle of Benefits and a Collection
of Solutions to Needs and Wants
COMPETITIVE A Benefit That Satisfies a Customer
ADVANTAGE: Better than a Competitor’s Product
Benefits
8-5
ACTIVITIES IN MANAGING PRODUCTS
• UNDERSTAND THE PRODUCT LIFE
CYCLE (PLC) AND APPLY IT TO PRODUCT
STRATEGY
• UNDERSTAND THE CONCEPT OF
PRODUCT PORTFOLIOS
• KNOW WHEN TO HARVEST A PRODUCT
8-6
PRODUCT LIFE CYCLE DECISION POINTS
Sales
Rapid expansion of distributors
Product line expansion
Niche marketing
Continued heavy promotion
Sales force incentives and
management
Search for new sources for
supply
Need to balance supply and
demand
Stock-out and back-order
damage control
Redirect focus & promotion
Invest in expanding production
Build inventory
Expand distributor network
Train expanded sales force
Institute marketing controls
Invest heavily in advertising
Target on best prospects:
innovators and enthusiasts
Use most loyal distributors
Use free samples
Use public demonstrations
and trade shows
Use publicity and endorsements
Use specialist media & catalogs
Development
Introduction
Strongly defend home-market
niches
Prune product lines
Emphasize gross contribution
rather than market share and
sales volume
Review logistics: prune costs
Reduce pioneering sale force
effort, more telemarketing
More trade than consumer
promotion
Introduce flankers, private
labels, generics
Reinvest in market research
& R&D
Use promotions to increase
heavy-user loyalty
Freeze investment in plant
Productivity review
Special trade promotions to
keep channels happy
Focused attacks on vulnerable
competitors
Long-term price reduction or
at least a short-term price
promotion
Keep plant at maximum
capacity and subcontract
excess
Growth
Maturity
Cut low-gross-margin products
from the line
Withdraw from channels in order
of their unprofitability
Freeze R& D and product
modifications
Freeze advertising and
promotions
Attempt to maintain price to the
end
Buy back remaining stock and
redistribute
Maintain spare parts and service
Consider divesting while it is a
going concern
Decline
Time
Exhibit 8-2
8-7
THE BCG MATRIX: MEASURING MARKET GROWTH
AND MARKET SHARE
BCG Matrix
Market Growth
Rate
Stars
Question
Marks
Cash
Cows
Dogs
Market Share Relative to Nearest Competitor
Exhibit 8-3
8-8
GE MATRIX MEASURING MARKET
ATTRACTIVENESS AND BUSINESS STRENGTH
GE Matrix
Market Attractiveness
• Growth
• Diversity
• Competitive
•
Structure
Change
• Technology Change
• Social Environment
Strong
Attractive
Exhibit 8-3
Unattractive
Weak
Business Strength
• Size of Market &
Share
• Company Growth
Rate
• Profit
• Margins
• Technology Platform
• Image
• People
8-9
PRODUCT DEVELOPMENT PROCESS:
A NEW LOOK
EVALUATION
LAUNCH
BETA TESTING
PRODUCT DEVELOPMENT
SPECIFYING FEATURES
SCREENING AND PRELIMINARY
INVESTIGATION
IDEA GENERATION
Exhibit 8-4
8-10
QUALITY FUNCTION DEPLOYMENT
Customers’
Linked to
Broken down
Process
desired
product
into
Characteristics
benefits
characteristics component
part
characteristics
Production
Controls
Exhibit 8-5
8-11
MAKING A PRODUCT SUCCESSFUL
1.
HAVE CLOSE TIES WITH A WELL DEFINED MARKET TO
ANTICIPATE CUSTOMER NEEDS.
2.
COMPANY IS HIGHLY INTEGRATED AND MARKETORIENTED
3.
COMPANY HAS A COMPETITIVE ADVANTAGE IN
TECHNOLOGY AND PRODUCTION CAPABILITY
4.
COMPANY HAS A STRONG MARKETING PROFICIENCY
5.
STRONG FINANCIAL SUPPORT
Exhibit 8-8
8-12
KEYS TO PRODUCT INNOVATION
AN INNOVATIVE COMPANY MUST HAVE
•
•
•
•
•
A CORPORATE CULTURE THAT SUPPORTS
INNOVATION – a desire for growth, improvement
A FOCUS ON OPPORTUNITY RISK INSTEAD OF
INVESTMENT RISK
A VISION OF WHAT THE NEW PRODUCT IS TO
ACCOMPLISH
A STRUCTURED DEVELOPMENT PROCESS
A LONG-TERM PERSPECTIVE
8-13
KEY PRODUCT
MANAGEMENT DECISIONS
1. WHICH PRODUCT TO INTRODUCE
2. WHICH PRODUCTS TO KEEP
3. WHICH PRODUCTS TO PROMOTE
4. WHAT LEVEL OF PROMOTION TO
PROVIDE (LOW TO HIGH)
5. WHAT PRODUCTS TO CONTINUE OR
DELETE
8-14
WINNING THE NEW PRODUCT CONTEST
•
FOCUS ON CORE COMPETENCY
(WHAT YOU DO BEST FOR A
COMPETITIVE ADVANTAGE)
PLUS
•
PROVIDE GREATEST VALUE TO
CUSTOMER
EQUALS
•
SUCCESSFUL PRODUCT
8-15