Product and brand management notes
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About This Presentation
This notes is for the students of MBA or BBA, it explains the concepts of product and brand management in detail but with simple presentation
Slide Content
1
Product and Brand Management – MBA-304-DSE -1
Unit - I
Product
1. Philip Kotler:
“Product is anything that can be offered to someone to satisfy a need or a want.”
W. Alderson:
“Product is a bundle of utilities, consisting of various product features and accompanying services.”
Product is a bundle of benefits-physical and psychological- that marketer wants to offer, or a bundle of
expectations that consumers want to fulfill. Marketer can satisfy needs and wants of target consumers by
products.
Types of Product:
A company sells different products (goods and services) to its target market.
They can be classified into two groups, such as:
1. Consumer Product, and
2. Industrial Products
1. Consumer Products:
Consumer products are those items which are used by ultimate consumers or households and they can be
used without further commercial and engineering processes.
Consumer products can be divided into four types as under:
i. Convenient Products: Such products improve or enhance users’ convenience. They are used in a day-
to-day life. They are frequently required and can be easily purchased. For example, soaps, biscuits,
toothpaste, razors and shaving creams, newspapers, etc. They are purchased spontaneously, without
much consideration, from nearby shops or retail malls.
Product and Brand Management – MBA-304-DSE -1
Unit - I
Product
1. Philip Kotler:
“Product is anything that can be offered to someone to satisfy a need or a want.”
W. Alderson:
“Product is a bundle of utilities, consisting of various product features and accompanying services.”
Product is a bundle of benefits-physical and psychological- that marketer wants to offer, or a bundle of
expectations that consumers want to fulfill. Marketer can satisfy needs and wants of target consumers by
products.
Types of Product:
A company sells different products (goods and services) to its target market.
They can be classified into two groups, such as:
1. Consumer Product, and
2. Industrial Products
1. Consumer Products:
Consumer products are those items which are used by ultimate consumers or households and they can be
used without further commercial and engineering processes.
Consumer products can be divided into four types as under:
i. Convenient Products: Such products improve or enhance users’ convenience. They are used in a day-
to-day life. They are frequently required and can be easily purchased. For example, soaps, biscuits,
toothpaste, razors and shaving creams, newspapers, etc. They are purchased spontaneously, without
much consideration, from nearby shops or retail malls.
2
ii. Shopping Products: These products require special time and shopping efforts. They are purchased
purposefully from special shops or markets. Quality, price, brand, fashion, style, getup, colour, etc., are
important criteria to be considered. They are to be chosen among various alternatives or varieties. Gold
and jewelries footwear, clothes, and other durables (including refrigerator, television, wrist washes,
etc.).
iii. Durable Products:
Durable products can last for a longer period and can be repeatedly used by one or more persons.
Television, computer, refrigerator, fans, electric irons, vehicles, etc., are examples of durable products.
Brand, company image, price, qualities (including safety, ease, economy, convenience, durability, etc.),
features (including size, colour, shape, weight, etc.), and after-sales services (including free installation,
home delivery, repairing, guarantee and warrantee, etc.) are important aspects the customers consider
while buying these products.
iv. Non-durable Products:
As against durable products, the non-durable products have short life. They must be consumed within
short time after they are manufactured. Fruits, vegetables, flowers, cheese, milk, and other provisions are
non-durable in nature. They are used for once. They are also known as consumables. Mostly, many of
them are non-branded. They are frequently purchased products and can be easily bought from nearby
outlets. Freshness, packing, purity, and price are important criteria to purchase these products.
v. Services: Services are different than tangible objects. Intangibility, variability, inseparability,
Perishability, etc., are main features of services. Services make our life safe and comfortable. Trust,
reliability, costs, regularity, and timing are important issues.
The police, the post office, the hospital, the banks and insurance companies, the cinema, the utility
services by local body, the transportation facilities, and other helpers (like barber, cobbler, doctor,
mechanic, etc.,) can be included in services. All marketing fundamental are equally applicable to
services. ‘Marketing of services’ is the emerging facet of modern marketing.
2. Industrial Products:
ii. Shopping Products: These products require special time and shopping efforts. They are purchased
purposefully from special shops or markets. Quality, price, brand, fashion, style, getup, colour, etc., are
important criteria to be considered. They are to be chosen among various alternatives or varieties. Gold
and jewelries footwear, clothes, and other durables (including refrigerator, television, wrist washes,
etc.).
iii. Durable Products:
Durable products can last for a longer period and can be repeatedly used by one or more persons.
Television, computer, refrigerator, fans, electric irons, vehicles, etc., are examples of durable products.
Brand, company image, price, qualities (including safety, ease, economy, convenience, durability, etc.),
features (including size, colour, shape, weight, etc.), and after-sales services (including free installation,
home delivery, repairing, guarantee and warrantee, etc.) are important aspects the customers consider
while buying these products.
iv. Non-durable Products:
As against durable products, the non-durable products have short life. They must be consumed within
short time after they are manufactured. Fruits, vegetables, flowers, cheese, milk, and other provisions are
non-durable in nature. They are used for once. They are also known as consumables. Mostly, many of
them are non-branded. They are frequently purchased products and can be easily bought from nearby
outlets. Freshness, packing, purity, and price are important criteria to purchase these products.
v. Services: Services are different than tangible objects. Intangibility, variability, inseparability,
Perishability, etc., are main features of services. Services make our life safe and comfortable. Trust,
reliability, costs, regularity, and timing are important issues.
The police, the post office, the hospital, the banks and insurance companies, the cinema, the utility
services by local body, the transportation facilities, and other helpers (like barber, cobbler, doctor,
mechanic, etc.,) can be included in services. All marketing fundamental are equally applicable to
services. ‘Marketing of services’ is the emerging facet of modern marketing.
2. Industrial Products:
3
Industrial products are used as the inputs by manufacturing firms for further processes on the products,
or manufacturing other products. Some products are both industrial as well as consumer products.
Machinery, components, certain chemicals, supplies and services, etc., are some industrial products.
Again, strict classification in term of industrial consumer and consumer products is also not possible,
For example, electricity, petroleum products, sugar, cloth, wheat, computer, vehicles, etc., are used by
industry as the inputs while the same products are used by consumers for their daily use as well.
Some companies, for example, electricity, cements, petrol and coals, etc., sell their products to industrial
units as well as to consumers. As against consumer products, the marketing of industrial products differs
in many ways.
Industrial products include:
1. Machines and components
2. Raw-materials and supplies
3. Services and consultancies
4. Electricity and Fuels, etc.
The Three Product Levels
Core Benefit. The core benefit is the fundamental need that the customer satisfies when they buy
the product. ...
Actual Product. The actual product is the product features and its design. ...
Augmented Product. The augmented product is any non-physical parts of the product.
Product policy
Product policy is defined as the broad guidelines related to the production and development of a product.
These policies are generally decided by the top management of a company i.e. board of directors. It is
like a long term planning with respect to the product-mix of the company in order to deliver maximum
customer satisfaction.
Industrial products are used as the inputs by manufacturing firms for further processes on the products,
or manufacturing other products. Some products are both industrial as well as consumer products.
Machinery, components, certain chemicals, supplies and services, etc., are some industrial products.
Again, strict classification in term of industrial consumer and consumer products is also not possible,
For example, electricity, petroleum products, sugar, cloth, wheat, computer, vehicles, etc., are used by
industry as the inputs while the same products are used by consumers for their daily use as well.
Some companies, for example, electricity, cements, petrol and coals, etc., sell their products to industrial
units as well as to consumers. As against consumer products, the marketing of industrial products differs
in many ways.
Industrial products include:
1. Machines and components
2. Raw-materials and supplies
3. Services and consultancies
4. Electricity and Fuels, etc.
The Three Product Levels
Core Benefit. The core benefit is the fundamental need that the customer satisfies when they buy
the product. ...
Actual Product. The actual product is the product features and its design. ...
Augmented Product. The augmented product is any non-physical parts of the product.
Product policy
Product policy is defined as the broad guidelines related to the production and development of a product.
These policies are generally decided by the top management of a company i.e. board of directors. It is
like a long term planning with respect to the product-mix of the company in order to deliver maximum
customer satisfaction.
4
Product policy objectives
1. Survival: - The main objective of any company is to stay in the market profitably.
2. Growth: - Based on the long term goals of the company the policies are defined to get a good growth
in the market.
3. Flexibility: - The product policy needs to be flexible to the changing needs of the customers,
government regulations, global trends and economy.
4. Scalability: - The companies should use its resources properly to make the most of its valuable
resources. With time the company needs to develop economies of scale to improve profits
The product mix is the variety of products a company produces or sells to the marketplace. A product
line often evolves, as manufacturers want to take advantage of a brand's value and the success of other
products in the mix. Retailers carry a mixture of products to satisfy various customers. The product mix
includes four common elements: Length, breadth, depth and consistency.
Length
The length element of the product mix refers to the number of products in a given product line. You
could also describe it as the number of stock keeping units or SKU's a company carries in a product line.
For instance, the length of a grocery retailer’s soft drink product line is the number of distinct brands it
carries. A longer product line means consumers have more options and access to greater assortment.
Breadth
Breadth of the product mix refers to the number of product lines that a company offer or the variety a
company offers. Offering a wider array of product lines is common for discount and department that sell
products in a number of different product categories. Manufacturers develop breadth to diversify risks of
a given product becoming obsolete. Retailers with wide variety often attempt to market themselves in a
virtual one-stop shop.
Depth
Depth is closely related to length in the product mix in the sense that it offers the consumer options
when selecting a given product. Depth refers to the different ways that you can buy a particular product
Product policy objectives
1. Survival: - The main objective of any company is to stay in the market profitably.
2. Growth: - Based on the long term goals of the company the policies are defined to get a good growth
in the market.
3. Flexibility: - The product policy needs to be flexible to the changing needs of the customers,
government regulations, global trends and economy.
4. Scalability: - The companies should use its resources properly to make the most of its valuable
resources. With time the company needs to develop economies of scale to improve profits
The product mix is the variety of products a company produces or sells to the marketplace. A product
line often evolves, as manufacturers want to take advantage of a brand's value and the success of other
products in the mix. Retailers carry a mixture of products to satisfy various customers. The product mix
includes four common elements: Length, breadth, depth and consistency.
Length
The length element of the product mix refers to the number of products in a given product line. You
could also describe it as the number of stock keeping units or SKU's a company carries in a product line.
For instance, the length of a grocery retailer’s soft drink product line is the number of distinct brands it
carries. A longer product line means consumers have more options and access to greater assortment.
Breadth
Breadth of the product mix refers to the number of product lines that a company offer or the variety a
company offers. Offering a wider array of product lines is common for discount and department that sell
products in a number of different product categories. Manufacturers develop breadth to diversify risks of
a given product becoming obsolete. Retailers with wide variety often attempt to market themselves in a
virtual one-stop shop.
Depth
Depth is closely related to length in the product mix in the sense that it offers the consumer options
when selecting a given product. Depth refers to the different ways that you can buy a particular product
5
in a product line. For instance, you can buy soft drink in a 2-Liter bottle, a six or 12-pack of cans, a 20-
ounce bottle or other sizes. You can buy dish soap in liquid, powder or gel form. These options further
enhance your flexibility as a buyer.
Consistency
The consistency element of the product mix refers to the connection between products within the
product line and the way they reach the consumer. For manufacturers, consistency refers to how closely
related production processes are for various products. The more consistent production is, the more
efficient and cost-effective. For retailers, consistency in a product mix makes it easier to perform
suggestive selling and recommend close products. Distinct products in the mix typically translate to a
unique selling process for that product
A product line is a group of related products all marketed under a single brand name that is sold by the
same company. Companies sell multiple product lines under their various brand names, seeking to
distinguish them from each other for better usability for consumers.
Packaging : Process of providing a container or a wrapper for providing safety and security for the
product and to enhance it appeal by the customers. In present competitive situation it is so significant
that it is considered as 5th p of marketing mix
Levels of packaging
in a product line. For instance, you can buy soft drink in a 2-Liter bottle, a six or 12-pack of cans, a 20-
ounce bottle or other sizes. You can buy dish soap in liquid, powder or gel form. These options further
enhance your flexibility as a buyer.
Consistency
The consistency element of the product mix refers to the connection between products within the
product line and the way they reach the consumer. For manufacturers, consistency refers to how closely
related production processes are for various products. The more consistent production is, the more
efficient and cost-effective. For retailers, consistency in a product mix makes it easier to perform
suggestive selling and recommend close products. Distinct products in the mix typically translate to a
unique selling process for that product
A product line is a group of related products all marketed under a single brand name that is sold by the
same company. Companies sell multiple product lines under their various brand names, seeking to
distinguish them from each other for better usability for consumers.
Packaging : Process of providing a container or a wrapper for providing safety and security for the
product and to enhance it appeal by the customers. In present competitive situation it is so significant
that it is considered as 5th p of marketing mix
Levels of packaging
6
Product modification and deletion
An adjustment made to an existing product, usually made for greater appeal or functionality. A
modification may include a change to a product's shape, adding a feature or improving its performance.
Often a product modification is accompanied by a change in packaging
There are three major ways of product modification, i.e. quality modifications, functional
modifications, and style modifications. (1) Quality modifications: These are changes that relate to a
product's dependability and durability and usually are executed by alterations in the materials or
production process employed
Product deletion is the process of removing products that perform below market expectations or fail to
meet company objectives. Deletion results in either product replacement or product elimination, in the
following some of the reasons are mentioned which are responsible for prodi=uct deletion from market
or company portfolio
Product modification and deletion
An adjustment made to an existing product, usually made for greater appeal or functionality. A
modification may include a change to a product's shape, adding a feature or improving its performance.
Often a product modification is accompanied by a change in packaging
There are three major ways of product modification, i.e. quality modifications, functional
modifications, and style modifications. (1) Quality modifications: These are changes that relate to a
product's dependability and durability and usually are executed by alterations in the materials or
production process employed
Product deletion is the process of removing products that perform below market expectations or fail to
meet company objectives. Deletion results in either product replacement or product elimination, in the
following some of the reasons are mentioned which are responsible for prodi=uct deletion from market
or company portfolio
7
Brand
A brand is a name, term, design, symbol or any other feature that identifies one seller's good or service
as distinct from those of other sellers.
[2][3][4]
Brands are used in business, marketing, and advertising
Branding is a set of marketing and communication methods that help to distinguish a company or
products from competitors, aiming to create a lasting impression in the minds of customers. The key
components that form a brand's toolbox include a brand's identity, brand communication (such as by
logos and trademarks), brand awareness, brand loyalty, and various branding (brand management)
strategies
Types of Brands and branding strategies
Uni-Brnading, Co branding, Multi branding
Family branding, Private branding, Brand extension, Brand extinction
Brand Loyalty, Brand equity, Brand Image
Brand management practices : These practices are to ensure that the brand continues in the market for
a longer time, in order to increase the brand life time value this following measure can be considered by
the companies
1. Leveraging technologies
Brand
A brand is a name, term, design, symbol or any other feature that identifies one seller's good or service
as distinct from those of other sellers.
[2][3][4]
Brands are used in business, marketing, and advertising
Branding is a set of marketing and communication methods that help to distinguish a company or
products from competitors, aiming to create a lasting impression in the minds of customers. The key
components that form a brand's toolbox include a brand's identity, brand communication (such as by
logos and trademarks), brand awareness, brand loyalty, and various branding (brand management)
strategies
Types of Brands and branding strategies
Uni-Brnading, Co branding, Multi branding
Family branding, Private branding, Brand extension, Brand extinction
Brand Loyalty, Brand equity, Brand Image
Brand management practices : These practices are to ensure that the brand continues in the market for
a longer time, in order to increase the brand life time value this following measure can be considered by
the companies
1. Leveraging technologies
8
2. Enhancing public relations
3. Empowering employees’
4. Improving USP
5. Being proactive and Market and Business analysis etc
Unit-II
New Product Development
Whenever the company decides to develop new product a committee will be formulated
comprising of expert from all departments, this committee is named as new product development
committee. The job of this committee is the process of new product development. The following
stages of new product development was propounded by BAH model (Booz, Allen and
Hamillton-1982). The stages are as follows
\
1. Idea generation – The New Product Development Process
2. Enhancing public relations
3. Empowering employees’
4. Improving USP
5. Being proactive and Market and Business analysis etc
Unit-II
New Product Development
Whenever the company decides to develop new product a committee will be formulated
comprising of expert from all departments, this committee is named as new product development
committee. The job of this committee is the process of new product development. The following
stages of new product development was propounded by BAH model (Booz, Allen and
Hamillton-1982). The stages are as follows
\
1. Idea generation – The New Product Development Process
9
The new product development process starts with idea generation. Idea generation refers to the
systematic search for new-product ideas. Typically, a company generates hundreds of ideas, maybe even
thousands, to find a handful of good ones in the end. Two sources of new ideas can be identified:
Internal idea sources: the company finds new ideas internally. That means R&D, but also
contributions from employees.
External idea sources: the company finds new ideas externally. This refers to all kinds of external
sources, e.g. distributors and suppliers, but also competitors. The most important external source
are customers, because the new product development process should focus on creating customer
value.
2. Idea screening – The New Product Development Process
The next step in the new product development process is idea screening. Idea screening means nothing
else than filtering the ideas to pick out good ones. In other words, all ideas generated are screened to
spot good ones and drop poor ones as soon as possible. While the purpose of idea generation was to
create a large number of ideas, the purpose of the succeeding stages is to reduce that number. The reason
is that product development costs rise greatly in later stages. Therefore, the company would like to go
ahead only with those product ideas that will turn into profitable products. Dropping the poor ideas as
soon as possible is, consequently, of crucial importance
3. Concept development and Testing – The New Product Development Process
To go on in the new product development process, attractive ideas must be developed into a product
concept. A product concept is a detailed version of the new-product idea stated in meaningful consumer
terms. You should distinguish
A product idea à an idea for a possible product
A product concept à a detailed version of the idea stated in meaningful consumer terms
A product image à the way consumers perceive an actual or potential product
Concept development
The new product development process starts with idea generation. Idea generation refers to the
systematic search for new-product ideas. Typically, a company generates hundreds of ideas, maybe even
thousands, to find a handful of good ones in the end. Two sources of new ideas can be identified:
Internal idea sources: the company finds new ideas internally. That means R&D, but also
contributions from employees.
External idea sources: the company finds new ideas externally. This refers to all kinds of external
sources, e.g. distributors and suppliers, but also competitors. The most important external source
are customers, because the new product development process should focus on creating customer
value.
2. Idea screening – The New Product Development Process
The next step in the new product development process is idea screening. Idea screening means nothing
else than filtering the ideas to pick out good ones. In other words, all ideas generated are screened to
spot good ones and drop poor ones as soon as possible. While the purpose of idea generation was to
create a large number of ideas, the purpose of the succeeding stages is to reduce that number. The reason
is that product development costs rise greatly in later stages. Therefore, the company would like to go
ahead only with those product ideas that will turn into profitable products. Dropping the poor ideas as
soon as possible is, consequently, of crucial importance
3. Concept development and Testing – The New Product Development Process
To go on in the new product development process, attractive ideas must be developed into a product
concept. A product concept is a detailed version of the new-product idea stated in meaningful consumer
terms. You should distinguish
A product idea à an idea for a possible product
A product concept à a detailed version of the idea stated in meaningful consumer terms
A product image à the way consumers perceive an actual or potential product
Concept development
10
Imagine a car manufacturer that has developed an all-electric car. The idea has passed the idea screening
and must now be developed into a concept. The marketer’s task is to develop this new product into
alternative product concepts. Then, the company can find out how attractive each concept is to
customers and choose the best one. Possible product concepts for this electric car could be:
Concept 1: an affordably priced mid-size car designed as a second family car to be used around
town for visiting friends and doing shopping.
Concept 2: a mid-priced sporty compact car appealing to young singles and couples.
Concept 3: a high-end midsize utility vehicle appealing to those who like the space SUVs
provide but also want an economical car.
As you can see, these concepts need to be quite precise in order to be meaningful. In the next sub-stage,
each concept is tested.
Concept testing
New product concepts, such as those given above, need to be tested with groups of target consumers.
The concepts can be presented to consumers either symbolically or physically. The question is always:
does the particular concept have strong consumer appeal? For some concept tests, a word or picture
description might be sufficient. However, to increase the reliability of the test, a more concrete and
physical presentation of the product concept may be needed. After exposing the concept to the group of
target consumers, they will be asked to answer questions in order to find out the consumer appeal and
customer value of each concept
4. Marketing strategy development – The New Product Development Process
The next step in the new product development process is the marketing strategy development. When a
promising concept has been developed and tested, it is time to design an initial marketing strategy for
the new product based on the product concept for introducing this new product to the market. The
marketing strategy statement consists of three parts and should be formulated carefully:
A description of the target market, the planned value proposition, and the sales, market share and
profit goals for the first few years
An outline of the product’s planned price, distribution and marketing budget for the first year
Imagine a car manufacturer that has developed an all-electric car. The idea has passed the idea screening
and must now be developed into a concept. The marketer’s task is to develop this new product into
alternative product concepts. Then, the company can find out how attractive each concept is to
customers and choose the best one. Possible product concepts for this electric car could be:
Concept 1: an affordably priced mid-size car designed as a second family car to be used around
town for visiting friends and doing shopping.
Concept 2: a mid-priced sporty compact car appealing to young singles and couples.
Concept 3: a high-end midsize utility vehicle appealing to those who like the space SUVs
provide but also want an economical car.
As you can see, these concepts need to be quite precise in order to be meaningful. In the next sub-stage,
each concept is tested.
Concept testing
New product concepts, such as those given above, need to be tested with groups of target consumers.
The concepts can be presented to consumers either symbolically or physically. The question is always:
does the particular concept have strong consumer appeal? For some concept tests, a word or picture
description might be sufficient. However, to increase the reliability of the test, a more concrete and
physical presentation of the product concept may be needed. After exposing the concept to the group of
target consumers, they will be asked to answer questions in order to find out the consumer appeal and
customer value of each concept
4. Marketing strategy development – The New Product Development Process
The next step in the new product development process is the marketing strategy development. When a
promising concept has been developed and tested, it is time to design an initial marketing strategy for
the new product based on the product concept for introducing this new product to the market. The
marketing strategy statement consists of three parts and should be formulated carefully:
A description of the target market, the planned value proposition, and the sales, market share and
profit goals for the first few years
An outline of the product’s planned price, distribution and marketing budget for the first year
11
The planned long-term sales, profit goals and the marketing mix strategy.
5. Business analysis – The New Product Development Process
Once decided upon a product concept and marketing strategy, management can evaluate the business
attractiveness of the proposed new product. The fifth step in the new product development process
involves a review of the sales, costs and profit projections for the new product to find out whether these
factors satisfy the company’s objectives. If they do, the product can be moved on to the product
development stage. In order to estimate sales, the company could look at the sales history of similar
products and conduct market surveys. Then, it should be able to estimate minimum and maximum sales
to assess the range of risk. When the sales forecast is prepared, the firm can estimate the expected costs
and profits for a product, including marketing, R&D, operations etc. All the sales and costs figures
together can eventually be used to analyse the new product’s financial attractiveness
6. Product development – The New Product Development Process
The new product development process goes on with the actual product development. Up to this point,
for many new product concepts, there may exist only a word description, a drawing or perhaps a rough
prototype. But if the product concept passes the business test, it must be developed into a physical
product to ensure that the product idea can be turned into a workable market offering. The problem is,
though, that at this stage, R&D and engineering costs cause a huge jump in investment. The R&D
department will develop and test one or more physical versions of the product concept. Developing a
successful prototype, however, can take days, weeks, months or even years, depending on the product
and prototype methods.
7. Test marketing – The New Product Development Process
The last stage before commercialisation in the new product development process is test marketing. In
this stage of the new product development process, the product and its proposed marketing programme
are tested in realistic market settings. Therefore, test marketing gives the marketer experience with
marketing the product before going to the great expense of full introduction. In fact, it allows the
company to test the product and its entire marketing programme, including targeting and positioning
strategy, advertising, distributions, packaging etc. before the full investment is made.
The planned long-term sales, profit goals and the marketing mix strategy.
5. Business analysis – The New Product Development Process
Once decided upon a product concept and marketing strategy, management can evaluate the business
attractiveness of the proposed new product. The fifth step in the new product development process
involves a review of the sales, costs and profit projections for the new product to find out whether these
factors satisfy the company’s objectives. If they do, the product can be moved on to the product
development stage. In order to estimate sales, the company could look at the sales history of similar
products and conduct market surveys. Then, it should be able to estimate minimum and maximum sales
to assess the range of risk. When the sales forecast is prepared, the firm can estimate the expected costs
and profits for a product, including marketing, R&D, operations etc. All the sales and costs figures
together can eventually be used to analyse the new product’s financial attractiveness
6. Product development – The New Product Development Process
The new product development process goes on with the actual product development. Up to this point,
for many new product concepts, there may exist only a word description, a drawing or perhaps a rough
prototype. But if the product concept passes the business test, it must be developed into a physical
product to ensure that the product idea can be turned into a workable market offering. The problem is,
though, that at this stage, R&D and engineering costs cause a huge jump in investment. The R&D
department will develop and test one or more physical versions of the product concept. Developing a
successful prototype, however, can take days, weeks, months or even years, depending on the product
and prototype methods.
7. Test marketing – The New Product Development Process
The last stage before commercialisation in the new product development process is test marketing. In
this stage of the new product development process, the product and its proposed marketing programme
are tested in realistic market settings. Therefore, test marketing gives the marketer experience with
marketing the product before going to the great expense of full introduction. In fact, it allows the
company to test the product and its entire marketing programme, including targeting and positioning
strategy, advertising, distributions, packaging etc. before the full investment is made.
12
The amount of test marketing necessary varies with each new product. Especially when introducing a
new product requiring a large investment, when the risks are high, or when the firm is not sure of the
product or its marketing programme, a lot of test marketing may be carried out.
8. Commercialisation
Test marketing has given management the information needed to make the final decision: launch or do
not launch the new product. The final stage in the new product development process is
commercialisation. Commercialisation means nothing else than introducing a new product into the
market. At this point, the highest costs are incurred: the company may need to build or rent a
manufacturing facility. Large amounts may be spent on advertising, sales promotion and other
marketing efforts in the first year.
Generic Product (core product or formula of product)
A generic product is something that is sold on the name of the product i.e. what it actually is, rather than
having a brand name. Such products generally have the name of the local shop which is selling the
product or a lesser known name, but sometimes they don't have any brand name on them. Generic
Competition
Generic Brand
A generic brand is a type of consumer product that lacks a widely recognized name or logo because it
typically isn't advertised. Generic brands are usually less expensive than brand-name products due to
their lack of promotion, which can inflate the cost of a good or service. Generic brands are designed to
be substitutes for more expensive brand-name goods. Generic brands are especially common in
supermarket goods and pharmaceuticals and tend to be more popular during a recession.
Growth strategy
Strategy aimed at winning larger market share, even at the expense of short-term earnings. Four broad
growth strategies are diversification, product development, market penetration, and market development,
there are various types of growth strategies some of them are as follows
The amount of test marketing necessary varies with each new product. Especially when introducing a
new product requiring a large investment, when the risks are high, or when the firm is not sure of the
product or its marketing programme, a lot of test marketing may be carried out.
8. Commercialisation
Test marketing has given management the information needed to make the final decision: launch or do
not launch the new product. The final stage in the new product development process is
commercialisation. Commercialisation means nothing else than introducing a new product into the
market. At this point, the highest costs are incurred: the company may need to build or rent a
manufacturing facility. Large amounts may be spent on advertising, sales promotion and other
marketing efforts in the first year.
Generic Product (core product or formula of product)
A generic product is something that is sold on the name of the product i.e. what it actually is, rather than
having a brand name. Such products generally have the name of the local shop which is selling the
product or a lesser known name, but sometimes they don't have any brand name on them. Generic
Competition
Generic Brand
A generic brand is a type of consumer product that lacks a widely recognized name or logo because it
typically isn't advertised. Generic brands are usually less expensive than brand-name products due to
their lack of promotion, which can inflate the cost of a good or service. Generic brands are designed to
be substitutes for more expensive brand-name goods. Generic brands are especially common in
supermarket goods and pharmaceuticals and tend to be more popular during a recession.
Growth strategy
Strategy aimed at winning larger market share, even at the expense of short-term earnings. Four broad
growth strategies are diversification, product development, market penetration, and market development,
there are various types of growth strategies some of them are as follows
13
Intensive growth strategy : Intensive growth strategies are business plans designed to improve the
business performance of a company, bringing the highest gains with the least amount of effort and risk.
They include strategies for market penetration, product development and market development.
Interactive strategy
interactive strategy is an integral aspect of the overall marketing strategy that involves addressing issues
such as channel choice, design aspects that suit various channels, technology and outreach constraints
within the overall plan, usability aspects including UI and UX design, among other issues
Diversification strategy
Diversification is a corporate strategy to enter into a new market or industry in which the business
doesn't currently operate, while also creating a new product for that new market.
Types of Diversification
The three types of diversification strategies include the concentric, horizontal and conglomerate.
Diversification is a method of risk management that involves the change and implementation of different
investments stated in a specific portfolio
1. concentric diversifications
The concentric diversifications specify that there exists similarities between the industries in terms of the
technological standpoint. It is through this that the firm may compare and apply its technological
knowhow to an advantage. This is through a careful change or alteration in the marketing strategy
performed by the business. This strategy aims to increase the market value of a particular product and
therefore gain a higher profit.
2. horizontal diversification
The horizontal diversification tackles products or services that are in a sense, not related technologically
to certain products but still pique the interest of current customers. This strategy is more effective is the
current clientele is loyal to the existing products or services, and if the new additions are well priced and
Intensive growth strategy : Intensive growth strategies are business plans designed to improve the
business performance of a company, bringing the highest gains with the least amount of effort and risk.
They include strategies for market penetration, product development and market development.
Interactive strategy
interactive strategy is an integral aspect of the overall marketing strategy that involves addressing issues
such as channel choice, design aspects that suit various channels, technology and outreach constraints
within the overall plan, usability aspects including UI and UX design, among other issues
Diversification strategy
Diversification is a corporate strategy to enter into a new market or industry in which the business
doesn't currently operate, while also creating a new product for that new market.
Types of Diversification
The three types of diversification strategies include the concentric, horizontal and conglomerate.
Diversification is a method of risk management that involves the change and implementation of different
investments stated in a specific portfolio
1. concentric diversifications
The concentric diversifications specify that there exists similarities between the industries in terms of the
technological standpoint. It is through this that the firm may compare and apply its technological
knowhow to an advantage. This is through a careful change or alteration in the marketing strategy
performed by the business. This strategy aims to increase the market value of a particular product and
therefore gain a higher profit.
2. horizontal diversification
The horizontal diversification tackles products or services that are in a sense, not related technologically
to certain products but still pique the interest of current customers. This strategy is more effective is the
current clientele is loyal to the existing products or services, and if the new additions are well priced and
14
adequately promoted. The newest additions are marketed in the same way that the previous ones were
which may cause instability. This is because the strategy increases the new products’ dependence on an
existing one. This integration normally occurs when a new business is introduced, however unrelated to
the existing.
3. Conglomerate or lateral diversification
Conglomerate or lateral diversification is where the company or business promotes products or services
with no relation commercially or technologically to the existing products or services, however still
interest a number of customers. This type of diversification is unique to the current business and may
prove quite risky. However, it may also prove very successful since it independently aims to improve on
the profit the company accumulates with regards to the new product or service
Product portfolio
Product portfolio is the collection of all the products or services offered by a company. Product portfolio
analysis can provide nuanced views on stock type, company growth prospects, profit margin drivers,
income contributions, market leadership, and operational risk. This is essential for investors conducting
equity research by investors or analysts supporting internal corporate financial planning
Portfolio Analysis is the process of reviewing or assessing the elements of the entire portfolio of
securities or products in a business. The review is done for careful analysis of risk and return. The
analysis also helps in proper resource/asset allocation to different elements in the portfolio
Advantages of portfolio analysis for any company are:
• Evaluation of the firm’s business by the top management
• It helps to assess the company’s attractiveness
• Raises issues related to cash flow availability
• It helps to assess the competitive strength of the company with respect to market share,
contribution margin, product fit etc.
• Communication is facilitated
adequately promoted. The newest additions are marketed in the same way that the previous ones were
which may cause instability. This is because the strategy increases the new products’ dependence on an
existing one. This integration normally occurs when a new business is introduced, however unrelated to
the existing.
3. Conglomerate or lateral diversification
Conglomerate or lateral diversification is where the company or business promotes products or services
with no relation commercially or technologically to the existing products or services, however still
interest a number of customers. This type of diversification is unique to the current business and may
prove quite risky. However, it may also prove very successful since it independently aims to improve on
the profit the company accumulates with regards to the new product or service
Product portfolio
Product portfolio is the collection of all the products or services offered by a company. Product portfolio
analysis can provide nuanced views on stock type, company growth prospects, profit margin drivers,
income contributions, market leadership, and operational risk. This is essential for investors conducting
equity research by investors or analysts supporting internal corporate financial planning
Portfolio Analysis is the process of reviewing or assessing the elements of the entire portfolio of
securities or products in a business. The review is done for careful analysis of risk and return. The
analysis also helps in proper resource/asset allocation to different elements in the portfolio
Advantages of portfolio analysis for any company are:
• Evaluation of the firm’s business by the top management
• It helps to assess the company’s attractiveness
• Raises issues related to cash flow availability
• It helps to assess the competitive strength of the company with respect to market share,
contribution margin, product fit etc.
• Communication is facilitated
15
For portfolio analysis, the company can make use of various models like BCG matrix, GE –nine cell
matrix, Ad Little Model and Shell International Model and also risk return analysis
BCG-Matrix
BCG-matrix, Boston matrix, Boston Consulting Group analysis, portfolio diagram) is a chart that
was created by Bruce D. Henderson for the Boston Consulting Group in 1970 to help corporations to
analyze their business units, that is, their product lines. This helps the company allocate resources and is
used as an analytical tool in brand marketing, product management, strategic management, and portfolio
analysis. Some analysis of market performance by firms using its principles has called its usefulness into
question
Cash cows is where a company has high market share in a slow-growing industry. These units
typically generate cash in excess of the amount of cash needed to maintain the business.
Dogs, more charitably called pets, are units with low market share in a mature, slow-growing
industry. These units typically "break even", generates barely enough cash Question marks (also
known as adopted children or Wild dogs) are businesses operating with a low market share in a
high-growth market. They are a starting point for most businesses. Question marks have a
potential to gain market share and become stars
For portfolio analysis, the company can make use of various models like BCG matrix, GE –nine cell
matrix, Ad Little Model and Shell International Model and also risk return analysis
BCG-Matrix
BCG-matrix, Boston matrix, Boston Consulting Group analysis, portfolio diagram) is a chart that
was created by Bruce D. Henderson for the Boston Consulting Group in 1970 to help corporations to
analyze their business units, that is, their product lines. This helps the company allocate resources and is
used as an analytical tool in brand marketing, product management, strategic management, and portfolio
analysis. Some analysis of market performance by firms using its principles has called its usefulness into
question
Cash cows is where a company has high market share in a slow-growing industry. These units
typically generate cash in excess of the amount of cash needed to maintain the business.
Dogs, more charitably called pets, are units with low market share in a mature, slow-growing
industry. These units typically "break even", generates barely enough cash Question marks (also
known as adopted children or Wild dogs) are businesses operating with a low market share in a
high-growth market. They are a starting point for most businesses. Question marks have a
potential to gain market share and become stars
16
Stars are units with a high market share in a fast-growing industry. The hope is that stars become
next cash cows
GE-Matrix or GE-Meckincy Model or nine cell matrix
The GE McKinsey Matrix, also known as the McKinsey Nine Box Matrix is a strategic tool used for
business portfolio planning. A business portfolio is a group of businesses that collectively make up a
company GE-matrix or multifactor analysis is a technique used in brand marketing and product
management to help a company decide what product(s) to add to its product portfolio and which
opportunities in the market they should continue to invest in. The GE matrix helps a strategic business
unit evaluate its overall strength.
Harvesting strategy : Harvesting strategy is a business plan for either cancelling or reducing marketing
spending on a product. ... Marketing executives choose a harvesting strategy when a product has reached
the end of its life cycle. They aim to extract maximum profit from any remaining sales3
Divestment strategy or retrenchment strategy
Divestment usually involves eliminating a portion of a business. Firms may elect to sell, close, or spin-
off a strategic business unit, major operating division, or product line. This move often is the final
decision to eliminate unrelated, unprofitable, or unmanageable operations.
Stars are units with a high market share in a fast-growing industry. The hope is that stars become
next cash cows
GE-Matrix or GE-Meckincy Model or nine cell matrix
The GE McKinsey Matrix, also known as the McKinsey Nine Box Matrix is a strategic tool used for
business portfolio planning. A business portfolio is a group of businesses that collectively make up a
company GE-matrix or multifactor analysis is a technique used in brand marketing and product
management to help a company decide what product(s) to add to its product portfolio and which
opportunities in the market they should continue to invest in. The GE matrix helps a strategic business
unit evaluate its overall strength.
Harvesting strategy : Harvesting strategy is a business plan for either cancelling or reducing marketing
spending on a product. ... Marketing executives choose a harvesting strategy when a product has reached
the end of its life cycle. They aim to extract maximum profit from any remaining sales3
Divestment strategy or retrenchment strategy
Divestment usually involves eliminating a portion of a business. Firms may elect to sell, close, or spin-
off a strategic business unit, major operating division, or product line. This move often is the final
decision to eliminate unrelated, unprofitable, or unmanageable operations.
17
Ad Little matrix –model
Arthur D. Little matrix is a portfolio management matrix which helps managers discern their SBUs
strategic position depending upon 2 dimensions-
1. SBU’s life cycle and
2. Competitive position
Each of these dimensions can be further split up into the following categories to better analyze a firm
and accordingly determine the future strategic actions-
Life cycle stages can be
1. Embryonic
2. Growth
3. Maturity
4. Ageing
Competitive position can also be either of the following
1. Dominant : The position of a company falls into this category if it is a clear market leader or has a
monopoly position. Example , Intel in microprocessors.
2. Strong : In this case, the company might not be a monopoly but definitely has a strong presence and
loyal customers.
3. Favourable: Companies with favourable competitive position usually operate in fragmented markets
and no single one controls all market share.
4. Tenable: Here each company caters to a niche segment defined by a product variety or segmented
demographically.
5. Weak : In this scenario, the company financials are too weak to gain a strong hold in the market and
is expected to die out within a short span of time.
Ad Little matrix –model
Arthur D. Little matrix is a portfolio management matrix which helps managers discern their SBUs
strategic position depending upon 2 dimensions-
1. SBU’s life cycle and
2. Competitive position
Each of these dimensions can be further split up into the following categories to better analyze a firm
and accordingly determine the future strategic actions-
Life cycle stages can be
1. Embryonic
2. Growth
3. Maturity
4. Ageing
Competitive position can also be either of the following
1. Dominant : The position of a company falls into this category if it is a clear market leader or has a
monopoly position. Example , Intel in microprocessors.
2. Strong : In this case, the company might not be a monopoly but definitely has a strong presence and
loyal customers.
3. Favourable: Companies with favourable competitive position usually operate in fragmented markets
and no single one controls all market share.
4. Tenable: Here each company caters to a niche segment defined by a product variety or segmented
demographically.
5. Weak : In this scenario, the company financials are too weak to gain a strong hold in the market and
is expected to die out within a short span of time.
18
Shell International-Business Portfolio Model : A somewhat similar approach to the GE business
screen is the Shell directional policy matrix. This approach also has two dimensions: company’s
competitive capabilities (vertical axis) and prospects for sector profitability (horizontal axis). The firm’s
SBUs or products are plotted into one of the nine cells and subsequently there is a suggested strategy for
each of the nine cells. The cells represent, starting at the bottom right hand corner:
Leader where major resources are focused on the SBU.
Try harder might be vulnerable over longer periods of time, but OK now.
Double or quit gamble on potential SBUs for the future.
Growth grow the market by focusing some resources here.
Custodial like a cash cow, milk it and do not commit more resources.
Cash generation milk for expansion elsewhere.
Phased withdrawal move cash to SBUs with greater potential.
Divest liquidate or move these assets on as fast as possible.
Risk return analysis
Shell International-Business Portfolio Model : A somewhat similar approach to the GE business
screen is the Shell directional policy matrix. This approach also has two dimensions: company’s
competitive capabilities (vertical axis) and prospects for sector profitability (horizontal axis). The firm’s
SBUs or products are plotted into one of the nine cells and subsequently there is a suggested strategy for
each of the nine cells. The cells represent, starting at the bottom right hand corner:
Leader where major resources are focused on the SBU.
Try harder might be vulnerable over longer periods of time, but OK now.
Double or quit gamble on potential SBUs for the future.
Growth grow the market by focusing some resources here.
Custodial like a cash cow, milk it and do not commit more resources.
Cash generation milk for expansion elsewhere.
Phased withdrawal move cash to SBUs with greater potential.
Divest liquidate or move these assets on as fast as possible.
Risk return analysis
19
Risk–return analysis seeks “efficient portfolios”, i.e., those which provide maximum return on
average for a given level of portfolio risk. It examines investment opportunities in terms familiar to the
financial practitioner: the risk and return of the investment portfolio.
The Main Types of Business Risk
Strategic Risk.
Compliance Risk.
Operational Risk.
Financial Risk.
Reputational Risk.
Unit – III
Product Maps, Market Maps and Joint Space Maps
A product map is a graphic representation of the ways people perceive products, in terms of
underlying attributes, as well as an aid in understanding their preferences. ... It shows how the products
are perceived by respondents. Each product occupies a specific point in the space.
A market map is a diagram that identifies all the products in the market using two key features. A
market map showing a gap in the market. The diagram above shows how four local cafés are
competing in terms of price and quality.
The market map illustrates the range of "positions" that a product can take in a market based on two
dimensions that are important to customers.
Examples of those dimensions might be:
High price v low price
Basic quality v High quality
Low volume v high volume
Risk–return analysis seeks “efficient portfolios”, i.e., those which provide maximum return on
average for a given level of portfolio risk. It examines investment opportunities in terms familiar to the
financial practitioner: the risk and return of the investment portfolio.
The Main Types of Business Risk
Strategic Risk.
Compliance Risk.
Operational Risk.
Financial Risk.
Reputational Risk.
Unit – III
Product Maps, Market Maps and Joint Space Maps
A product map is a graphic representation of the ways people perceive products, in terms of
underlying attributes, as well as an aid in understanding their preferences. ... It shows how the products
are perceived by respondents. Each product occupies a specific point in the space.
A market map is a diagram that identifies all the products in the market using two key features. A
market map showing a gap in the market. The diagram above shows how four local cafés are
competing in terms of price and quality.
The market map illustrates the range of "positions" that a product can take in a market based on two
dimensions that are important to customers.
Examples of those dimensions might be:
High price v low price
Basic quality v High quality
Low volume v high volume
20
Necessity v luxury
Joint Space Maps. A common approach to perceptual mapping is to integrate both the consumer's
perceptions of the various competing brands along with the preferred/ideal needs for the different
consumer segments in the market. This style of perceptual mapping is usually referred to as a joint
space map. A typical perceptual map is a two-dimensional graph with a vertical axis (Y) and a
horizontal axis (X). Each axis consists of a pair of opposite attributes at each end
Idea screening
Idea screening is a process that evaluates and contrasts new product ideas to get the most promising
ones for your business. Not every idea is relevant to your company. ... Through a successful idea
screening process, it helps in focusing the whole product development process with a higher possibility
of achieving success. The screening step is a critical part of the new product development process.
Product ideas that do not meet the organization's objectives should be rejected. Two problems that may
arise during the screening stage are the acceptance of a poor product idea, and the rejection of a viable
product idea
Concept Generation
Success of any product based company is governed by New Product Development which is driven by
generation of pool of Innovative Ideas which take the form of concepts.Concept Generation involves
collection of available New Product Concepts that fit the selected high potential opportunity and
generate new ones as well.
Concept selection
Concept selection is one of early stages in product development in which proposed concept are
evaluated to select the best concept that best fulfil the decision making criteria. Concept development
refers to the basic understanding that is necessary to make sense of one's world. This includes ideas
about the self and others, objects, and the environment. This foundational understanding is crucial to
communication, travel, and independence
Concept testing
Necessity v luxury
Joint Space Maps. A common approach to perceptual mapping is to integrate both the consumer's
perceptions of the various competing brands along with the preferred/ideal needs for the different
consumer segments in the market. This style of perceptual mapping is usually referred to as a joint
space map. A typical perceptual map is a two-dimensional graph with a vertical axis (Y) and a
horizontal axis (X). Each axis consists of a pair of opposite attributes at each end
Idea screening
Idea screening is a process that evaluates and contrasts new product ideas to get the most promising
ones for your business. Not every idea is relevant to your company. ... Through a successful idea
screening process, it helps in focusing the whole product development process with a higher possibility
of achieving success. The screening step is a critical part of the new product development process.
Product ideas that do not meet the organization's objectives should be rejected. Two problems that may
arise during the screening stage are the acceptance of a poor product idea, and the rejection of a viable
product idea
Concept Generation
Success of any product based company is governed by New Product Development which is driven by
generation of pool of Innovative Ideas which take the form of concepts.Concept Generation involves
collection of available New Product Concepts that fit the selected high potential opportunity and
generate new ones as well.
Concept selection
Concept selection is one of early stages in product development in which proposed concept are
evaluated to select the best concept that best fulfil the decision making criteria. Concept development
refers to the basic understanding that is necessary to make sense of one's world. This includes ideas
about the self and others, objects, and the environment. This foundational understanding is crucial to
communication, travel, and independence
Concept testing
21
Concept testing is done both with surveys as well as qualitative research (such as focus groups or in-
person interviews). Base your concept test methodology on both who you need to include in the research
as well as whether your concept lends itself to being presented graphically or verbally, without rational
explanation or discussion. In either case, the research investment conducted at the concept testing phase
is minimal compared to launching a new product that does not meet sales goals or one that needs
extensive re-tooling or re-marketing post-launch.
1. To develop the original idea further..
2. To estimate the concept’s market potential.
3. To eliminate lower-potential concepts..
4. To determine the value of concept features and benefits
5. To identify the highest potential customer segments..
6. To estimate of sales or trial rate. To identify optimal messaging and inform marketing plans for
launch.
Product Architecture. • Product architecture is the scheme by which the. functional elements of the
product are arranged. into physical chunks and by which the chunks. Product Architecture is concerned
with how the function of any product is organized into physical parts, such as assemblies and
components. As mentioned earlier, the overall function of the product is reviewed and a number of sub-
functions are identified, which need to take place in order to achieve the overall function. Likewise,
assemblies and parts must be assigned to carry out these sub-functions and in-turn the whole function.
There are principally two types of product development architecture – integral design and modular
design.
Unit – IV
Market structure is best defined as the organisational and other characteristics of a market. We focus
on those characteristics which affect the nature of competition and pricing – but it is important not to
place too much emphasis simply on the market share of the existing firms in an industry.
Preference segmentation
Concept testing is done both with surveys as well as qualitative research (such as focus groups or in-
person interviews). Base your concept test methodology on both who you need to include in the research
as well as whether your concept lends itself to being presented graphically or verbally, without rational
explanation or discussion. In either case, the research investment conducted at the concept testing phase
is minimal compared to launching a new product that does not meet sales goals or one that needs
extensive re-tooling or re-marketing post-launch.
1. To develop the original idea further..
2. To estimate the concept’s market potential.
3. To eliminate lower-potential concepts..
4. To determine the value of concept features and benefits
5. To identify the highest potential customer segments..
6. To estimate of sales or trial rate. To identify optimal messaging and inform marketing plans for
launch.
Product Architecture. • Product architecture is the scheme by which the. functional elements of the
product are arranged. into physical chunks and by which the chunks. Product Architecture is concerned
with how the function of any product is organized into physical parts, such as assemblies and
components. As mentioned earlier, the overall function of the product is reviewed and a number of sub-
functions are identified, which need to take place in order to achieve the overall function. Likewise,
assemblies and parts must be assigned to carry out these sub-functions and in-turn the whole function.
There are principally two types of product development architecture – integral design and modular
design.
Unit – IV
Market structure is best defined as the organisational and other characteristics of a market. We focus
on those characteristics which affect the nature of competition and pricing – but it is important not to
place too much emphasis simply on the market share of the existing firms in an industry.
Preference segmentation
22
The market segmentation can be characterized in different ways, and one of the basic kinds is
through Preference segments, such as: Homogeneous Preferences: When the customers have relatively
the same kind of preferences in terms of their needs and wants, the market shows no natural segments.
The preference segmentation is like that of benefit segmentation
Perceptual Mapping
Perceptual mapping is a diagrammatic technique used by marketers in an attempt to visually display the
perceptions of customers or potential customers. Typically the position of a product, product line, brand,
or company is displayed relative to their competition.
Choice Modelling
It’s a method by which certain conditions can be reproduced to more effectively predict a person’s
choice when confronted with several options. Choice modelling is about much more than trying to find
out which product fares the best against a sea of competitors; it’s a market research tool that gives better
insight into customer behaviour patterns, as well as the trade-off between cost and value. Choice
modelling predicts actual economic decisions that can help you better plan your next move.
'Brand Aid' = Brand + Aid celebrity + Cause
The market segmentation can be characterized in different ways, and one of the basic kinds is
through Preference segments, such as: Homogeneous Preferences: When the customers have relatively
the same kind of preferences in terms of their needs and wants, the market shows no natural segments.
The preference segmentation is like that of benefit segmentation
Perceptual Mapping
Perceptual mapping is a diagrammatic technique used by marketers in an attempt to visually display the
perceptions of customers or potential customers. Typically the position of a product, product line, brand,
or company is displayed relative to their competition.
Choice Modelling
It’s a method by which certain conditions can be reproduced to more effectively predict a person’s
choice when confronted with several options. Choice modelling is about much more than trying to find
out which product fares the best against a sea of competitors; it’s a market research tool that gives better
insight into customer behaviour patterns, as well as the trade-off between cost and value. Choice
modelling predicts actual economic decisions that can help you better plan your next move.
'Brand Aid' = Brand + Aid celebrity + Cause
23
Brand Aid is the combined meaning of “aid to brands” and “brands that provide aid.” It is aid to brands,
a mechanism that helps selling products, profiling a brand in the media, and building brand value. It is
also aid financing that is provided through branding. It is a marketing-mix Model used by the marketing
departments of the organisations. Consumers, partnering with corporations and celebrities, are forming
new alliances in international development through what we call 'Brand Aid' initiatives. It is online
model for assembling marketing decision elements to describe the market and evaluate strategies. The
structure is modular so that individual decision areas can be added or deleted at will. The model is of the
aggregate response type model in which all the responses are considered as a single response
Defender model of market strategy (Hauser and Shagun-1983)
A competitive strategy in which a business concentrates on its existing products or services and attempts
to protect (rather than expand) its market share by offering superior quality, low prices, and strong
customer service. Such a policy requires firm cost control and is usually only successful in an
established, stable market where there is little scope for innovation
Defenders are companies that do not aggressively pursue markets. They look for relatively stable
markets and seek to maintain their positions in these markets.
Such companies usually keep their prices low, and do not incur much expenditure on advertising and
promotion. They offer a limited range of products and focus more on better quality of products and good
customer service. They are slow in decision making and commit themselves to a decision only after
thorough research and analysis. They do not go for early market entry and focus more protecting their
position in the market.
This model is based on the following assumptions
Existing brand can be positioned in a multi attribute space in the market
Consumer ties to maximise the utilities from the brand
Usually the consumer utility is monotonous from the brand
Awareness and distribution are concave functions of advertising (increase in the ad spent may
decrease value some time it is concave )
Brand Aid is the combined meaning of “aid to brands” and “brands that provide aid.” It is aid to brands,
a mechanism that helps selling products, profiling a brand in the media, and building brand value. It is
also aid financing that is provided through branding. It is a marketing-mix Model used by the marketing
departments of the organisations. Consumers, partnering with corporations and celebrities, are forming
new alliances in international development through what we call 'Brand Aid' initiatives. It is online
model for assembling marketing decision elements to describe the market and evaluate strategies. The
structure is modular so that individual decision areas can be added or deleted at will. The model is of the
aggregate response type model in which all the responses are considered as a single response
Defender model of market strategy (Hauser and Shagun-1983)
A competitive strategy in which a business concentrates on its existing products or services and attempts
to protect (rather than expand) its market share by offering superior quality, low prices, and strong
customer service. Such a policy requires firm cost control and is usually only successful in an
established, stable market where there is little scope for innovation
Defenders are companies that do not aggressively pursue markets. They look for relatively stable
markets and seek to maintain their positions in these markets.
Such companies usually keep their prices low, and do not incur much expenditure on advertising and
promotion. They offer a limited range of products and focus more on better quality of products and good
customer service. They are slow in decision making and commit themselves to a decision only after
thorough research and analysis. They do not go for early market entry and focus more protecting their
position in the market.
This model is based on the following assumptions
Existing brand can be positioned in a multi attribute space in the market
Consumer ties to maximise the utilities from the brand
Usually the consumer utility is monotonous from the brand
Awareness and distribution are concave functions of advertising (increase in the ad spent may
decrease value some time it is concave )
24
(PREFMAP) PREFERENCE MAPPING
Preference Mapping is used in market research to gain deep insight into product analysis. It is used by
the company by implementing a software called excel XLSTAT statistical software.
These preference mapping techniques is used to analyse products (the objects) and to answer questions
such as:
How is our product positioned compared with the competitors' products?
Which product is the closest to ours?
Which type of consumer prefers my product?
Why are the competitors' products positioned as such?
How can I reposition my product so that it fits better my target group?
What success can I expect from my product?
Which new products should I encourage the R&D department to create?
Preference mapping provides a powerful approach to optimizing product acceptability.
Flowcharts and concepts
A flowchart describes the steps software takes to process information, from the beginning data inputs,
through processing and logical decisions, to the point where the program ends. Software developers
use flowcharts to plan out how computer applications work before programmers write the code.
The three most commonly used types of flowcharts include:
Process Flowchart.
Data Flowchart.
Business Process Modelling Diagram.
Cost-behaviour learning curve
(PREFMAP) PREFERENCE MAPPING
Preference Mapping is used in market research to gain deep insight into product analysis. It is used by
the company by implementing a software called excel XLSTAT statistical software.
These preference mapping techniques is used to analyse products (the objects) and to answer questions
such as:
How is our product positioned compared with the competitors' products?
Which product is the closest to ours?
Which type of consumer prefers my product?
Why are the competitors' products positioned as such?
How can I reposition my product so that it fits better my target group?
What success can I expect from my product?
Which new products should I encourage the R&D department to create?
Preference mapping provides a powerful approach to optimizing product acceptability.
Flowcharts and concepts
A flowchart describes the steps software takes to process information, from the beginning data inputs,
through processing and logical decisions, to the point where the program ends. Software developers
use flowcharts to plan out how computer applications work before programmers write the code.
The three most commonly used types of flowcharts include:
Process Flowchart.
Data Flowchart.
Business Process Modelling Diagram.
Cost-behaviour learning curve
25
This curve is very important in cost analysis, cost estimation and efficiency studies. This curve is called
the learning curve. The learning curve shows that if a task is performed over and over than less time will
be required at each iteration. Learning curves are also known as experience curve, cost curves,
efficiency curves and productivity curves. These curves help demonstrate the cost per unit of output
decreases over time with the increase in experience of the workforce. Learning curves and experience
curves is extensively used by organization in production planning, cost forecasting and setting delivery
schedule
Learning curve is relevant in taking following decision:
Pricing decision based on estimation of future costs.
Workforce schedule based on future requirements.
Capital requirement projections
Set-up of incentive structure
A learning curve is a concept that graphically depicts the relationship between the cost and output over a
defined period of time, normally to represent the repetitive task of an employee or worker. The learning
curve is used as a way to measure production efficiency and to forecast costs. The learning curve also is
referred to as the experience curve, the cost curve, the efficiency curve, or the productivity curve.
companies know how much an employee earns per hour and can derive the cost of producing a single
unit of output based on the number of hours needed. A well-placed employee who is set up for success
should decrease the company's costs per unit of output over time.
Innovation Diffusion and Adoption process
Diffusion is the process by which an innovation is communicated through certain channels, over time,
among the members of a social system. Diffusion of innovations is a theory that seeks to explain how,
why, and- at what rate new ideas and technology spread. The four main elements that influence the
diffusion of a new idea are the innovation itself, communication channels, time, and a social system.
The categories of adopters are innovators, early adopters, early majority, late majority, and laggards
This curve is very important in cost analysis, cost estimation and efficiency studies. This curve is called
the learning curve. The learning curve shows that if a task is performed over and over than less time will
be required at each iteration. Learning curves are also known as experience curve, cost curves,
efficiency curves and productivity curves. These curves help demonstrate the cost per unit of output
decreases over time with the increase in experience of the workforce. Learning curves and experience
curves is extensively used by organization in production planning, cost forecasting and setting delivery
schedule
Learning curve is relevant in taking following decision:
Pricing decision based on estimation of future costs.
Workforce schedule based on future requirements.
Capital requirement projections
Set-up of incentive structure
A learning curve is a concept that graphically depicts the relationship between the cost and output over a
defined period of time, normally to represent the repetitive task of an employee or worker. The learning
curve is used as a way to measure production efficiency and to forecast costs. The learning curve also is
referred to as the experience curve, the cost curve, the efficiency curve, or the productivity curve.
companies know how much an employee earns per hour and can derive the cost of producing a single
unit of output based on the number of hours needed. A well-placed employee who is set up for success
should decrease the company's costs per unit of output over time.
Innovation Diffusion and Adoption process
Diffusion is the process by which an innovation is communicated through certain channels, over time,
among the members of a social system. Diffusion of innovations is a theory that seeks to explain how,
why, and- at what rate new ideas and technology spread. The four main elements that influence the
diffusion of a new idea are the innovation itself, communication channels, time, and a social system.
The categories of adopters are innovators, early adopters, early majority, late majority, and laggards
26
Five stages of the adoption process
Stage Definition
Knowledge
The individual is first exposed to an innovation, but lacks information about the
innovation. During this stage the individual has not yet been inspired to find out more
information about the innovation.
Persuasion
The individual is interested in the innovation and actively seeks related
information/details.
Decision
The individual takes the concept of the change and weighs the
advantages/disadvantages of using the innovation and decides whether to adopt or
reject the innovation. Due to the individualistic nature of this stage, Rogers notes that
it is the most difficult stage on which to acquire empirical evidence.
[11]
Implementation
The individual employs the innovation to a varying degree depending on the situation.
During this stage the individual also determines the usefulness of the innovation and
may search for further information about it.
Confirmation
The individual finalizes his/her decision to continue using the innovation. This stage is
both intrapersonal (may cause cognitive dissonance) and interpersonal, confirmation
the group has made the right decision.
Five stages of the adoption process
Stage Definition
Knowledge
The individual is first exposed to an innovation, but lacks information about the
innovation. During this stage the individual has not yet been inspired to find out more
information about the innovation.
Persuasion
The individual is interested in the innovation and actively seeks related
information/details.
Decision
The individual takes the concept of the change and weighs the
advantages/disadvantages of using the innovation and decides whether to adopt or
reject the innovation. Due to the individualistic nature of this stage, Rogers notes that
it is the most difficult stage on which to acquire empirical evidence.
[11]
Implementation
The individual employs the innovation to a varying degree depending on the situation.
During this stage the individual also determines the usefulness of the innovation and
may search for further information about it.
Confirmation
The individual finalizes his/her decision to continue using the innovation. This stage is
both intrapersonal (may cause cognitive dissonance) and interpersonal, confirmation
the group has made the right decision.
27
Adopter
category
Definition
Innovators
Innovators are willing to take risks, have the highest social status, have financial liquidity,
are social and have closest contact to scientific sources and interaction with other
innovators. Their risk tolerance allows them to adopt technologies that may ultimately
fail. Financial resources help absorb these failures.
[41]
Early
adopters
These individuals have the highest degree of opinion leadership among the adopter
categories. Early adopters have a higher social status, financial liquidity, advanced
education and are more socially forward than late adopters. They are more discreet in
adoption choices than innovators. They use judicious choice of adoption to help them
maintain a central communication position.
[42]
Early
Majority
They adopt an innovation after a varying degree of time that is significantly longer than
the innovators and early adopters. Early Majority have above average social status,
contact with early adopters and seldom hold positions of opinion leadership in a system
(Rogers 1962, p. 283)
Late
Majority
They adopt an innovation after the average participant. These individuals approach an
innovation with a high degree of skepticism and after the majority of society has adopted
the innovation. Late Majority are typically skeptical about an innovation, have below
average social status, little financial liquidity, in contact with others in late majority and
early majority and little opinion leadership.
Laggards
They are the last to adopt an innovation. Unlike some of the previous categories,
individuals in this category show little to no opinion leadership. These individuals
typically have an aversion to change-agents. Laggards typically tend to be focused on
"traditions", lowest social status, lowest financial liquidity, oldest among adopters, and in
contact with only family and close friends.
Demand analysis
Adopter
category
Definition
Innovators
Innovators are willing to take risks, have the highest social status, have financial liquidity,
are social and have closest contact to scientific sources and interaction with other
innovators. Their risk tolerance allows them to adopt technologies that may ultimately
fail. Financial resources help absorb these failures.
[41]
Early
adopters
These individuals have the highest degree of opinion leadership among the adopter
categories. Early adopters have a higher social status, financial liquidity, advanced
education and are more socially forward than late adopters. They are more discreet in
adoption choices than innovators. They use judicious choice of adoption to help them
maintain a central communication position.
[42]
Early
Majority
They adopt an innovation after a varying degree of time that is significantly longer than
the innovators and early adopters. Early Majority have above average social status,
contact with early adopters and seldom hold positions of opinion leadership in a system
(Rogers 1962, p. 283)
Late
Majority
They adopt an innovation after the average participant. These individuals approach an
innovation with a high degree of skepticism and after the majority of society has adopted
the innovation. Late Majority are typically skeptical about an innovation, have below
average social status, little financial liquidity, in contact with others in late majority and
early majority and little opinion leadership.
Laggards
They are the last to adopt an innovation. Unlike some of the previous categories,
individuals in this category show little to no opinion leadership. These individuals
typically have an aversion to change-agents. Laggards typically tend to be focused on
"traditions", lowest social status, lowest financial liquidity, oldest among adopters, and in
contact with only family and close friends.
Demand analysis
28
Demand analysis is a research done to estimate or find out the customer demand for a product or service
in a particular market. Demand analysis helps firm forecast the market which is of importance in the
modern business activities. It helps to design the appropriate pricing policy. The Demand Analysis is a
process whereby the management makes decisions with respect to the production, cost allocation,
advertising, inventory holding, pricing, etc. Although, how much a firm produces depends on its
production capacity but how much it must endeavor to produce depends on the potential demand for its
product.
First and repeat purchase
Demand analysis is a research done to estimate or find out the customer demand for a product or service
in a particular market. Demand analysis helps firm forecast the market which is of importance in the
modern business activities. It helps to design the appropriate pricing policy. The Demand Analysis is a
process whereby the management makes decisions with respect to the production, cost allocation,
advertising, inventory holding, pricing, etc. Although, how much a firm produces depends on its
production capacity but how much it must endeavor to produce depends on the potential demand for its
product.
First and repeat purchase
29
A first purchase is an investment made to own something in business, it is for the purchasing of a
product the first time, usually the customer shows this behavior after excellent marketing
communication and clear message by the companies
A repeat purchase is the purchase by a consumer of a same-brand product as bought on a previous
occasion. A repeat purchase is an indicator of a degree of customer loyalty to a brand. In order to
ensure repeat purchase by the customers the company can take up these measure
1. Stay in touch with the customers
2. Assume they won't remember you and keep on reminding
3. Keep the experience fresh and relevant all the times
4. Surprise them with new offers and promotions
5. Collaborate with customers in terms of opinions
6. Have the right people on the front-line, and train the employees
7. Make it easy for customers to reach you improve accessible points
8. Listen to them beyond their needs and wants
Trial and Repeat purchase
Product trial is where a customer samples a product for the first time. Repeat purchase is where
consumers regularly purchase a brand. Trial and repeat purchase are the two metrics we need to closely
monitor to assess a new FMCG product’s market potential. For the product to succeed, it needs to
establish a base of regular consumers who continue to buy it. It must generate appeal so that a
substantial number of consumers try it. Once they experience it, an adequate number of them should be
willing to continue buying it. A repeat purchase is the purchase by a consumer of a same-brand product
as bought on a previous occasion. A repeat purchase is an indicator of a degree of customer loyalty to a
brand. It is also an opportunity for marketers to establish long-term customer relationships. A high
number of repeat purchases indicates a satisfied and “well-retained” customer, which reduces new-
A first purchase is an investment made to own something in business, it is for the purchasing of a
product the first time, usually the customer shows this behavior after excellent marketing
communication and clear message by the companies
A repeat purchase is the purchase by a consumer of a same-brand product as bought on a previous
occasion. A repeat purchase is an indicator of a degree of customer loyalty to a brand. In order to
ensure repeat purchase by the customers the company can take up these measure
1. Stay in touch with the customers
2. Assume they won't remember you and keep on reminding
3. Keep the experience fresh and relevant all the times
4. Surprise them with new offers and promotions
5. Collaborate with customers in terms of opinions
6. Have the right people on the front-line, and train the employees
7. Make it easy for customers to reach you improve accessible points
8. Listen to them beyond their needs and wants
Trial and Repeat purchase
Product trial is where a customer samples a product for the first time. Repeat purchase is where
consumers regularly purchase a brand. Trial and repeat purchase are the two metrics we need to closely
monitor to assess a new FMCG product’s market potential. For the product to succeed, it needs to
establish a base of regular consumers who continue to buy it. It must generate appeal so that a
substantial number of consumers try it. Once they experience it, an adequate number of them should be
willing to continue buying it. A repeat purchase is the purchase by a consumer of a same-brand product
as bought on a previous occasion. A repeat purchase is an indicator of a degree of customer loyalty to a
brand. It is also an opportunity for marketers to establish long-term customer relationships. A high
number of repeat purchases indicates a satisfied and “well-retained” customer, which reduces new-
30
customer acquisition costs and increases overall profitability. The business’ repeat purchase rate may be
increased using web and social media promotions, digital loyalty programs, and exceptional customer
service.
Consumer state
↓ → Mind process
Aware
↓
Trail
↓ →Action by consumer
↓ →
2
nd
repeat
Unaware
1
st
repeat
customer acquisition costs and increases overall profitability. The business’ repeat purchase rate may be
increased using web and social media promotions, digital loyalty programs, and exceptional customer
service.
Consumer state
↓ → Mind process
Aware
↓
Trail
↓ →Action by consumer
↓ →
2
nd
repeat
Unaware
1
st
repeat
31
Model of purchase
The repeat purchase is nothing but the customer retention by the company; it can be obtained by means
of the following measures, In business world retention is always challenging and to obtained this the
company needs be very much focused and attentive, by adopting following strategies the company can
ensure certain amount of repeat purchase by the customers.
Model of purchase
The repeat purchase is nothing but the customer retention by the company; it can be obtained by means
of the following measures, In business world retention is always challenging and to obtained this the
company needs be very much focused and attentive, by adopting following strategies the company can
ensure certain amount of repeat purchase by the customers.
32
Unit-V
Product launch and guidelines for launching
A product launch is when a company decides to launch a new product in the market. Product launch can
be of an existing product which is already in the market or it can be a completely new
innovative product which the company has made A successful product launch depends on careful
planning and preparation. It is the final stage in the product development process, which represents a
significant investment in future revenue and profit for your small business. Every product launch needs
to be under certain guidelines and principles, some of the most important guidelines for product launch
are
1. Define Your Target Audience
Defining your target audience gives you direction in for marketing decisions it
2. Know How to Reach Your Audience
Understand the target audience and how to reach them effectively, both with the ad and mentally. Get in
the mind of your target audience and understand where the best place to reach
3. Know the Problem You're Solving
Always stay focused on your "who" and "why." Test it with your personas, talk to them about it, and
know it is something that will fulfil an unmet need first
4. Understand the Buying Journey :The buying process forms the foundation of all marketing and
sales activities. You need to have an intimate understanding the buyer's pain points, where they get their
information and who influences the purchase
5. Validate Your Product
By means of validating the product, the company tries to make the customers understand that the
product is ideal for their needs and satisfaction and tries to create image for the product
Unit-V
Product launch and guidelines for launching
A product launch is when a company decides to launch a new product in the market. Product launch can
be of an existing product which is already in the market or it can be a completely new
innovative product which the company has made A successful product launch depends on careful
planning and preparation. It is the final stage in the product development process, which represents a
significant investment in future revenue and profit for your small business. Every product launch needs
to be under certain guidelines and principles, some of the most important guidelines for product launch
are
1. Define Your Target Audience
Defining your target audience gives you direction in for marketing decisions it
2. Know How to Reach Your Audience
Understand the target audience and how to reach them effectively, both with the ad and mentally. Get in
the mind of your target audience and understand where the best place to reach
3. Know the Problem You're Solving
Always stay focused on your "who" and "why." Test it with your personas, talk to them about it, and
know it is something that will fulfil an unmet need first
4. Understand the Buying Journey :The buying process forms the foundation of all marketing and
sales activities. You need to have an intimate understanding the buyer's pain points, where they get their
information and who influences the purchase
5. Validate Your Product
By means of validating the product, the company tries to make the customers understand that the
product is ideal for their needs and satisfaction and tries to create image for the product
33
6. Know Your Competition and Be Different
7. Create A Free Trial Or Demo
8. Lay Out A Comprehensive Strategic Plan
9. Get Everyone on The Same Page
10. Offer Early Use Incentives
11. Keep Testing It
Pre testing and Test-Marketing
The pre testing and test marketing are the important aspects of product launch strategy, by means of
these two aspects the company decides about the timing and situations under which the product will be
launched
The test marketing is a stage in product development process where the product and its marketing plan
are exposed to a carefully chosen sample of the population for deciding if to reject it before its full scale
launch. Test marketing is an experiment comprising of actual stores and real-life buying situations,
without the buyers knowing they are participating in an evaluation exercise. It simulates the eventual
market-mix to ascertain consumer reaction. Depending on the quality and quantity of sales data required
for the final decision, test marketing may last from few weeks to several months. These steps are useful
for the following points
Determine if, or verify that, the requirements of a specification, regulation, or contract are met
Decide if a new product development program is on track: Demonstrate proof of concept
Provide standard data for other scientific, engineering, and quality assurance functions
Validate suitability for end-use
Provide a basis for technical communication
Provide a technical means of comparison of several options
Provide evidence in legal proceedings: product liability, patents, product claims
6. Know Your Competition and Be Different
7. Create A Free Trial Or Demo
8. Lay Out A Comprehensive Strategic Plan
9. Get Everyone on The Same Page
10. Offer Early Use Incentives
11. Keep Testing It
Pre testing and Test-Marketing
The pre testing and test marketing are the important aspects of product launch strategy, by means of
these two aspects the company decides about the timing and situations under which the product will be
launched
The test marketing is a stage in product development process where the product and its marketing plan
are exposed to a carefully chosen sample of the population for deciding if to reject it before its full scale
launch. Test marketing is an experiment comprising of actual stores and real-life buying situations,
without the buyers knowing they are participating in an evaluation exercise. It simulates the eventual
market-mix to ascertain consumer reaction. Depending on the quality and quantity of sales data required
for the final decision, test marketing may last from few weeks to several months. These steps are useful
for the following points
Determine if, or verify that, the requirements of a specification, regulation, or contract are met
Decide if a new product development program is on track: Demonstrate proof of concept
Provide standard data for other scientific, engineering, and quality assurance functions
Validate suitability for end-use
Provide a basis for technical communication
Provide a technical means of comparison of several options
Provide evidence in legal proceedings: product liability, patents, product claims
34
Marketing Mix Allocations
For effective marketing mix allocation the company uses modelling called marketing mix modelling,
this modelling is an analytical approach and uses historic information, such as syndicated point-of-sale
data and companies’ internal data, to quantify the sales impact of various marketing activities. MMM
(marketing mix modelling) defines the effectiveness of each of the marketing elements in terms of its
contribution to sales-volume, effectiveness. These learnings are then adopted to adjust marketing tactics
and strategies to optimize the marketing plan and also to forecast sales while simulating various
scenarios.
The output can be used to analyse the impact of the marketing elements on various dimensions. The
contribution of each element as a percentage of the total plotted year on year is a good indicator of how
the effectiveness of various elements changes over the years. This analysis tells the marketing manager
the incremental gain in sales that can be obtained by increasing the respective marketing element by one
unit.
The marketing mix modelling not only helps the company in finding out the best fit for the elements of
marketing but also helps in the following
Contribution by marketing activity
ROI by marketing activity
Effectiveness of marketing activity
Optimal distribution of spends
Learnings on how to execute each activity better
Organisation for product management
Product management is an organizational lifecycle function within a company dealing with the planning,
forecasting, and production, or marketing of a product or products at all stages of the product lifecycle.
... Product management also involves elimination decisions. The strategic role of product
management is to be “messenger of the market,” delivering market and product information to
the departments that need facts to make decisions. ... For technology companies, particularly those with
enterprise or B2B products, the product management job is very technical.
Marketing Mix Allocations
For effective marketing mix allocation the company uses modelling called marketing mix modelling,
this modelling is an analytical approach and uses historic information, such as syndicated point-of-sale
data and companies’ internal data, to quantify the sales impact of various marketing activities. MMM
(marketing mix modelling) defines the effectiveness of each of the marketing elements in terms of its
contribution to sales-volume, effectiveness. These learnings are then adopted to adjust marketing tactics
and strategies to optimize the marketing plan and also to forecast sales while simulating various
scenarios.
The output can be used to analyse the impact of the marketing elements on various dimensions. The
contribution of each element as a percentage of the total plotted year on year is a good indicator of how
the effectiveness of various elements changes over the years. This analysis tells the marketing manager
the incremental gain in sales that can be obtained by increasing the respective marketing element by one
unit.
The marketing mix modelling not only helps the company in finding out the best fit for the elements of
marketing but also helps in the following
Contribution by marketing activity
ROI by marketing activity
Effectiveness of marketing activity
Optimal distribution of spends
Learnings on how to execute each activity better
Organisation for product management
Product management is an organizational lifecycle function within a company dealing with the planning,
forecasting, and production, or marketing of a product or products at all stages of the product lifecycle.
... Product management also involves elimination decisions. The strategic role of product
management is to be “messenger of the market,” delivering market and product information to
the departments that need facts to make decisions. ... For technology companies, particularly those with
enterprise or B2B products, the product management job is very technical.
35
Product managers are responsible for guiding the success of a product and leading the cross-
functional team that is responsible for improving it. It is an important organizational role — especially
in technology companies — that sets the strategy, roadmap, and feature definition for
a product or product line
Planopt model
This model is for proper allocation of marketing mix for a particular product category, given the fact that
every product class or category has unique set of marketing mix allocations, It is model which also uses
the the computer assisted model.
The planopt model speaks about planning for optimum allocation of marketing mix elements, this model
is studied in two parts
1. Effect of allocations on product class
2. Effect on sales of a product in terms of market share by the product
This model use an equation to understand the outcomes
UTUS (1) = BU (1) × PQ (1)
UTUS: Unconditional total unit sales
BU: No of buying units
PQ : Purchase quantity
Product managers are responsible for guiding the success of a product and leading the cross-
functional team that is responsible for improving it. It is an important organizational role — especially
in technology companies — that sets the strategy, roadmap, and feature definition for
a product or product line
Planopt model
This model is for proper allocation of marketing mix for a particular product category, given the fact that
every product class or category has unique set of marketing mix allocations, It is model which also uses
the the computer assisted model.
The planopt model speaks about planning for optimum allocation of marketing mix elements, this model
is studied in two parts
1. Effect of allocations on product class
2. Effect on sales of a product in terms of market share by the product
This model use an equation to understand the outcomes
UTUS (1) = BU (1) × PQ (1)
UTUS: Unconditional total unit sales
BU: No of buying units
PQ : Purchase quantity
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