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Module 1: Introduction to IBM
Module 1: Introduction to IBM
• Concept of category and product
• Concept of Brand & Evolution of Brand
• Category attractiveness and competitor analysis
• Product strategy over life cycle
• New product development
A Product Manager’s Potential Interactions
Sales
Designers Researchers
Premium suppliers Premium screening Store testing Sampling Couponing
Media
Advertis-ing
agency
Packaging
Promotion services
Purchasing
Publicity
Legal
Fiscal
Market research
Manufactur-ing and
distribution
Research and
development
ProductProduct managermanager
Suppliers
Trade
Suppliers
TradeResearch suppliers
Suppliers
Agency media department Company media department Media sales reps
Product-Focused StructureHead of
company/division
Corporate communications
FinanceMarketingManufacturing
Manager of product A
Manager of product C
Manager of product B
Marketing Research
SupportProduct
management
Brand: The beginning
• Searing of flesh with a hot iron to produce a scar or mark with an easily recognizable pattern for identification purpose
• Livestock were branded by the Egyptians as early as 2000BCE.
• The practice was brought to North America in the sixteenth century by the Spanish conqueror Hernan Cortes (1485-1547)
Brand: The evolution
• 1882: Harley Procter named his generically named ‘white soap’ as ‘Ivory Soap’: an idea that apparently came to him while reading a psalm in church
• In December of that year, ‘Ivory’ got a slogan ‘’99 and 44/100% pure’
• 1888, in Janesville, Wisconsin, George Safford Parker named each pen produced by his company a ‘Parker Pen’
• In Europe, food industry provided the first brand names such as Nestle, Cadbury, Kellogg
Best Global Brands 2009
Summary of INTERBRAND top 100 Global Brands 2008
Country of ORIGIN No. of Brands
US 52
Finland 1
Japan 7
Germany 10
France 8
South Korea 2
Sweden 2
UK 3
Switzerland 5
Netherlands 3
Canada 2
Italy 4
Spain 1
http://www.superbrandsindia.com/sb07_brands.htm
:: Superbrands India ::
What is a brand?
A brand is a name, term, sign, symbol, or design,A brand is a name, term, sign, symbol, or design,
or a combination of them,or a combination of them,
intended to identity the goods or servicesintended to identity the goods or services
of one seller or group of sellersof one seller or group of sellers
andand toto differentiate them from those of competitorsdifferentiate them from those of competitors
- American Marketing Association- American Marketing Association
“A product is an object or service that’s available.
A brand is a complex set of satisfactions delivered.”
Jeremy Bullmore, WPP
“Branding is a natural, instinctive human creation. A way of making a complicated world simpler. With a
brand, you get a symbol, a cue - you know what you’re getting, you know what to expect.”
Niall Fitzgerald, Unilever
How others define a brand
Or put another way
Personality
User imagery
Symbols
Brand/customer relationships
Emotional benefits
Self-expressive benefits
Corporate associations
Country of origin and history
Functional benefits
Attributes
Uses
Quality
Value
Brand/flesh
Product/stone
Brands can reduce risk in product decisions. There are many different types of risks that consumers may perceive in buying and consuming a product:
1. Functional Risk
2. Physical Risk
3. Financial Risk
4. Social Risk
5. Psychological Risk
6. Time Risk
SO,
Defining the Competitive Set
Bases of CompetitionI. Customer-oriented
Who they are – competition for same budgetWhen they use itWhy they use it- benefits sought
II. Marketing-oriented: advertising and promotion
Theme/copy strategyMediaDistributionPrice
Bases of Competition cont.
III. Resource-orientedRaw materialsEmployeesFinancial resources
IV. Geographic
Levels of Competition
Diet lemon limes
Baseball cards
Fruit flavored colas
Coffee
DietCoke
DietPepsi
Diet-Rite cola
Bottled water
Lemon limes
Regularcolas
Beers
Juices
Wine
Fast food
Tea
Video rentals
Icecream
Product form competition: Diet colas
Product category competition: Soft drinks
Generic competition: Beverages
Budget competition: Food and entertainment
Levels of Competition: Implications for Product Strategy
Budget
Generic
Product Category
Product Form
Competitive Level
Convince Customers that the Brand is Better than Others
Convince Customers that the Product Form is Best in the
Category
Convince Customers that the Product Category is the Best
Way to Satisfy Needs
Convince Customers that the Generic Benefits are the Most
Appropriate Way to Spend their Money
Product Management Task
Category Attractiveness Analysis
Aggregate Category Factors
• Category size
• Category growth
• Stage in product life cycle
• Sales cyclicity
• Seasonality
• Profits
Category Attractiveness over the Product Life Cycle
Stage of product life cycle
Category size
Category growth
Category attractiveness
Introduction
Small
Low
Low
Growth
Moderate
High
High
Maturity
Large
Low
Low/high
Decline
Moderate
Negative
Low
Sales
Time
Category Factors
• Threat of new entrants
• Bargaining power of buyers
• Bargaining power of suppliers
• Current category rivalry
• Pressure from substitutes
• Category capacity
Customer Analysis: What We Need to Know about Current and Potential Customers
• Who buys and uses the product• What customers buy and how they use it• Where customers buy• When customers buy• How customers choose• Why they prefer a product• How they respond to marketing programs• Will they buy it (again)?
Basic Customer Strategies
1. Customer acquisition
2. Customer retention
3. Customer expansion
4. Customer deletion
New-Product Development
Categories of New Products
New-To-The-WorldNew-To-The-World
New Product LinesNew Product Lines
Product Line AdditionsProduct Line Additions
Improvements/RevisionsImprovements/Revisions
Repositioned ProductsRepositioned Products
Lower-Priced ProductsLower-Priced Products
SixCategories
ofNew
Products
SixCategories
ofNew
Products
New-Product Development ProcessNew-Product Development Process
IdeaGeneration
IdeaScreening
ConceptDevelopmentand Testing
MarketingStrategy
BusinessAnalysis
ProductDevelopment
TestMarketing
Commercialization
Idea Generation
CustomersCustomers
EmployeesEmployees
DistributorsDistributors
CompetitorsCompetitors
R & DR & D
ConsultantsConsultants
Creative ThinkingCreative Thinking
Sources ofSources ofNew-ProductNew-Product
IdeasIdeas
Sources ofSources ofNew-ProductNew-Product
IdeasIdeas
“you could not help but notice that there were three or four family members on a scooter, the kid standing in the front, the guy driving the scooter and the wife sitting side saddle holding a little kid. And when you're driving a car, you certainly say, Oh my god, be careful, they may slip. Add to that slippery roads and night time too.”
Idea ScreeningThe first filter in the product development process, which
eliminates ideas that are inconsistent with the organization’s new-
product strategy or are inappropriate for some other reason.•Many companies have systems for rating and screening ideas which estimate:
– Market Size– Product Price– Development Time & Costs– Manufacturing Costs– Rate of Return– Strange New Products
1. Develop New Product Ideas into Alternative Detailed
Product Concepts
1. Develop New Product Ideas into Alternative Detailed
Product Concepts
2. Concept Testing - Test theNew Product Concepts with Groups of Target Customers
2. Concept Testing - Test theNew Product Concepts with Groups of Target Customers
3. Choose the One That Has theStrongest Appeal to Target
Customers
3. Choose the One That Has theStrongest Appeal to Target
Customers
New Product Development ProcessStep 3. Concept Development & Testing
New Product Development ProcessStep 3. Concept Development & Testing
Part Two Describes Short-Term:Product’s Planned Price
DistributionMarketing Budget
Part Two Describes Short-Term:Product’s Planned Price
DistributionMarketing Budget
Part Three Describes Long-Term:Sales & Profit Goals
Marketing Mix Strategy
Part Three Describes Long-Term:Sales & Profit Goals
Marketing Mix Strategy
Marketing Strategy Statement Formulation
Part One Describes Overall:Target Market
Planned Product PositioningSales & Profit Goals
Market Share
Part One Describes Overall:Target Market
Planned Product PositioningSales & Profit Goals
Market Share
New Product Development ProcessStep 4. Marketing Strategy Development
New Product Development ProcessStep 4. Marketing Strategy Development
Step 5. Business Analysis
Considerations Considerations in in
Business Business Analysis StageAnalysis Stage
Considerations Considerations in in
Business Business Analysis StageAnalysis Stage
Demand
Cost
Sales
Profitability
apple-history.com :: iPod
Step 6. Development
Creation of prototype
Marketing strategy
Packaging, branding, labeling
Manufacturing feasibility
Final government approvals if needed
New Product Development ProcessStep 7. Test Marketing
New Product Development ProcessStep 7. Test Marketing
AdvertisingAdvertising
PackagingPackaging
ProductProductBudget LevelsBudget Levels
Positioning Strategy
Positioning Strategy
DistributionDistributionPricingPricing
BrandingBranding
Elements that May be Test
Marketed by a Company
Test Marketing is the Stage Where the Product and Marketing Program are Introduced into More Realistic
Market Settings.
When?When? Where?Where?
Commercialization is the Introduction of the New Product into the Marketplace.
New Product Development ProcessStep 8. Commercialization
New Product Development ProcessStep 8. Commercialization
Whom?Whom?How?How?
Why New Products Fail
• No discernible benefits
• Poor match between features and customer desires
• Overestimation of market size
• Incorrect positioning
• Price too high or too low
• Inadequate distribution
• Poor promotion
• Inferior product
From Product to Brand
Why do Brands matter?
For Consumers
• Identification of Product Source
• Risk reducer• Reduces search costs• Symbolic of self
image• Signal of Quality• Assignment of
responsibility
For Manufacturers
• Identification to simplify handling or tracing
• Legal Protection• Signal of Quality
Level• Competitive
Advantage• Financial Returns
Contracting with a Brand
• A Brand is a contract, carved in stone and long (ever ?) lasting contrat
with the final consumer
with her own environment
• This is a two ways contract (return contract ?)
Historical / Memory Future / Project
Battle Field
Utility(Functions/Values)
Existence(Identity)
Target Acceptance
The Moral Contract of a Brand
MENTAL MAPS
• Portrays salient brand associations and responses for a particular target market
• Reflect how brand is perceived by consumers– Beliefs– Attitudes– Opinion– Feelings– Images – Experiences
THANK YOU