Product Management April 5 & 10, 2007

Product Management I. The Product Life Cycle A.Introduction B.Growth C.Maturity D.Decline

Product Management I. Goals at each stage of the Product Life Cycle: A.Introduction: Inform B.Growth: Persuade C.Maturity: Remind D.Decline

Product Management II. The Marketing Mix Variables A.Product B.Promotion C.Price D.Place

Promotion

I.Elements of the Promotion Mix A.Advertising B.Sales Promotion C.Personal Selling D.Public Relations II.When/Why to Use the Elements of the Promotion Mix

Element A: Advertising Advertising Objectives Inform, Persuade, Remind Measures of Media Effectiveness Reach Frequency CPM

Element B: Sales Promotion Sales Promotions Push vs. Pull Tactics: Push: Trade Oriented Allowances and Discounts Cooperative Advertising Training of Distributors Salesforces Pull: Consumer Oriented Coupons Deals (in-store price reductions) Samples Contests/Sweepstakes Loyalty Programs Rebates Product Placement

Element C: Personal Selling Objectives for Personal Selling Introduction Growth Maturity Decline

Element D: Public Relations Objectives for Public Relations Introduction Growth Maturity Decline

Price

Pricing 3 C’s of Pricing Cost Competition Customer (demand)

Quantity Demanded Price The Standard Downward Sloping Demand Curve

Pricing Pricing Strategies Skimming Penetration Prestige Pricing Optional Feature Pricing Complementary Product Pricing “Captive” Product Pricing

Slide FIGURE 14-9 FIGURE 14-9 Five most common deceptive pricing practices

Place

Distribution Channels Direct vs. Indirect Channels

Slide 2 Apple Computer Products Mac mini iPod iMac G5

Slide 3 Apple Computer Marketing Channel Structure: Online Apple Store - Direct Channel CustomersConsumer Producer

Slide 4 Apple Computer Marketing Channel Structure: Apple Retail Store - Direct Channel CustomersConsumer Producer

Slide 5 Apple Computer Marketing Channel Structure: CompUSA - Direct Channel/Strategic Channel Alliance CustomersConsumer Retailer Producer Apple Employees Staff CompUSA Store-Within- A-Store CompUSA

Slide 6 Apple Computer Marketing Channel Structure: Ingram Micro/Best Buy - Indirect Channel CustomersConsumer Wholesaler Retailer Producer Best Buy Ingram Micro

Slide 7 Apple Computer Marketing Channel Structure: MacMall Online/Catalog Sales - Indirect Channel CustomersConsumer Retailer Producer MacMall

Slide Common marketing channels for consumer goods and services

Place Distribution Channels Direct vs. Indirect Channels Why Use Intermediaries?

Slide How intermediaries minimize transactions

Place Distribution Channels Direct vs. Indirect Channels Why Use Intermediaries? Types of Intermediaries Merchandise Wholesalers Agents and Brokers Vertical Marketing Systems Forward Integration Backward Integration Franchising

From Exam 1 to Exam 2

Where we’ve come since then… Concepts become more concrete and specific via Design Branding Prototyping We can test any or all of the above aspects using concept tests (similar to those discussed before) to get better information to use in forecasting the product’s success

Where we left off… Concepts were still rough… Concept Screening Concept Testing

Where we’ve come since then… Or, we can use one of the market testing techniques below to get even more realistic data to use in our forecasts: Pseudo Sales or Simulated Market Tests Controlled or Full Sale Market Tests During these tests, we can better identify the target market and refine the marketing mix variables so that the full launch goes more smoothly.

Where we’ve come since then… If we have all of those elements right: PRODUCT Promotion Price Place, Then hopefully, we need to worry about managing the new product through the first three stages of the PLC!