Chapter 13 Marketing in Today’s World Market Research and Product Development

Market Research Market Research: the gathering and analysis of information on the size, location, and makeup of a market This helps businesses discover consumers’ wants and needs Marketing Concept: involves determining the wants and needs of customers and providing them more efficiently and effectively than competitors Demographics: Facts about the population. Include age, gender, location, and income This information comes from surveys, sales figures for current products, databases, and the census. Target Marketing: helps companies focus on the people most likely to buy their goods or services Market Segmentation: the division of a market for a product into groups of customers who have the same needs and traits

The Seven Steps of Product Development Step 1: Generate Ideas Step 2: Screen Ideas Step 3: Develop a Business Plan Step 4: Develop the Product Step 5: Test-Market the Product Step 6: Introduce the Product Step 7: Evaluate Customer Acceptance

Step 1: Generate Ideas Brainstorming: getting together with others to come up with new ideas for products People from Development dept., market research staff, and even outside researchers may be involved

Step 2: Screen Ideas Evaluation of each idea Do they fit the company’s mission and strategy? Does it compete with an existing product the company already has? Likes and Dislikes from consumer surveys Responses to surveys determine if a company goes through with the proposed product

Step 3: Develop a Business Plan Once it passes the screening, it can be developed into a business plan. This written proposal takes a look at the market, estimated sales, costs, profit potential, market trends, and competing products

Step 4: Develop the Product Develop a prototype Prototype: a model of the actual product. Used to see what the actual product will look like Tests how it can be made Changes can be made

Step 5: Test-Market the Product Test-market: to offer it in a limited market for a limited time The goal is to collect customers’ responses to see if the product is likely to be a success. Must be done in limited time to prevent competitors from developing the same type of product.

Step 6: Introduce the Product Ready for the marketplace Publicity campaign to introduce the product Short time in the market before competitors enter with similar products Especially true after a product becomes successful

Step 7: Evaluate Customer Acceptance Marketers track customers and their responses to the product Information is used in company reports and research/development plans If customers like the new product the company will continue to produce it, if not, then the product may not be on the market long

Homework Review the questions on pg. 227, 1-3 Complete the Ch. 13.2 Reading Activity Homework due Friday Quiz Friday