MGMT EXAM 2
Product life cycle stages
1. Market introduction 2. Market growth 3. Market maturity 4. Market decline
Market Potential
- Screen ideas for rough estimate of value - Who is the target segment?
Market introductory stage
- Single new product - Inform customers
Goods
- Tangible - Search - Manufactured and inventoried - Standardized
Innovation Approaches
- Top-down or inside-out innovation - Bottom up, outside in, Co-creation innovation
Branding Strategies
- Umbrella brands - House of Brands
Early Adopters
- influential - sizable group
Innovators
- like to try new ideas - willing to take risks - relatively educated and confident about assessing product on their own.
Laggards or non-adopters
- more risk averse and skeptical of new products - often lower income - has little relevance to them
Digital Sales Funnel
1. Brand Awareness 2. Consideration 3. Free Trial 4. New Customer 5. Customer Loyalty
How do you value brands?
1. Financial Performance 2. Role of Brand in Purchase Decision 3. Brand competitive strength
NPD Process (New Product Development)
1. Idea Generation 2. Market Research 3. Concept testing 4. Design and Development 5. Beta testing 6. Launch
Conjoint analysis
Conjoint procedure allows for different attributes to be compared in order to determine trade-offs.
Image Ads
Conveys can image, more abstract. Often uses a package "beauty shot"
Persona
Fictional character that is created to represent a user type that might use a product, brand or website in a similar way
Crawl
Find every URL that they can that could be a potential answer to the question
Design and Development: Product
Formulas, product design
AIDA Definition
Framework for what you are trying to accomplish with advertising
Design and Development: Packaging
Function, form, graphics
Introductory stage goal (Product life cycle)
Get first time buyers to try (trial)
Cognitive Ads
Gives the consumer a reason to buy the brand that is rational or functional.
Design and Development: Logo
Good simple design, legally available
Emotional Ads
Humor/fear
Top-down/ Inside out approach to NPD
Ideas come from inside the company, Product is developed first, feedback from outside comes later in the NPD process, Role of marketing is in launch planning Common in technology-oriented companies
Frequency
The average number of times a target saw the ad (within set duration)
Brand benefits
Product benefits: "the Job" the attribute does for the customer.
Diffusion of Innovation Model
Theory regarding how new projects spread through the marketplace.
Index
Store and organize content. Once page is in the index, it is in the running to displayed as a result to a search query.
Product attributes
Tangible characteristics of a product that influences its purchase. - Size - Color - Design - Materials
Goods are tangible or intangible?
Tangible- there is something concrete to take home.
Reach
The % share of your target audience that has seen your ad at least once.
Market decline stage
- Reduce number of products - Decreases to stay profitable
Inseparability
Services are simultaneously produced and consumed.
Umbrella brands
- Attaches brand name to all products - Product introductions are easier to understand and accept - Stronger financial outcomes for company - Much cheaper ex. Nike, Honda
Core offerings (Hotel)
- Bed - Safety -Blankets
Beta Testing
- Beta-testing simulates a real-world environment - A beta version of the product is produced - Ads are run and sales are tracked
Companies care about brands because:
- Build customer loyalty - bring higher prices - protect from competitors - encourage channel partner support - lower financing costs - Attract, retain and motivate employees
Customers
- Consistent quality - Align w our values - Can depend on it
Search Engine Optimization (SEO) Ways to improve organic search results
- Content (relevant): providing up to date content - Technical: Quick, goes to the right place - Backlinks: links to other websites that link to other websites helps with authority
External sources
- Customers - Business partner - Competition
Brand Association Network
- Depicts cognitive brand connections - When activated, associations are triggered - Links closet to brand retrieved first - Distinguish product attributes, product benefits, and emotional benefits
Engagement
- Distinctiveness: uniquely own able assets and experiences - Remains authentic to brand narrative (Patagonia) - Encourage involvement and collaboration
Value-Added offerings
- Easy check-in - Fluffy beds - Movies - Spa shower
Late Majority
- Even more cautious - Often older and more conservative - Want to buy proven products
Launch
- Forecast is developed - Product manufactured - Sales and marketing plans are executed
What is a Product?
- Goods - Goods and services - Multiple products (product line) - One of the 4P's - All 4P's
3 Approaches companies typically use to establish a marketing budget.
- How much do we spend? - When do we spend? - Which media do we use?
Idea Generation
- Ideas come from inside and outside the company - Internal and external sources
Cognition Advertising
- Increasing awareness and knowledge of the brand. Ex. Duck Duck Go
Services
- Intangible - Credence - Perishable - Variable
Brand strength factors
- Leadership - Engagement - Relevance - Customers
Customers/consumers care about brands because:
- Make a purchase decision easier - bring consistent quality - align with their values - reduce risk - convey information - bring a sense of community
Internal sources
- Management - R&D, in houses, brainstorming - Feedback from the front line
4 Ways to drive strategic growth
- Market penetration: Sell more of the same products to current markets. New ways to use the products, better pricing, better reward program, etc. - Market development: Sell existing products to new markets more internationally, appeal to younger segment, etc. May need to modify image, expand channels. - Product development: Sell new or modified products to current markets. Brand and line extensions or new variations of existing products. - Diversification: Pursue new markets with new products. More difficult.
Early Majority
- More risk averse than the first two groups - Waiting to hear that the early adopters had favorable experiences
House of brands
- New brand for every major line of product - One brand won't negatively affect others - Can reach multiple segments Ex. P&G
Market maturity stage
- New features - Reminder advantages
Search Engine Marketing (SEM)
- Paid Ads- when advertisers pay for social media ads ex. billboards, social media
Relevance
- Presence- omnipresent, easily recalled, talked about positively - Trust- delivers on expectations, acts with integrity and with customers' interests in mind - Affinity- feel a positive connection to the brand
Market growth stage
- Product tweaks - Heavy advantages ward off competitors
Design and Development
- Product, product design - Logo, Name - Marketing campaign- advertising tv, digital
Leadership
- Purpose with a plan, values that guide execution - Empathy to customer & stakeholder needs - Speed to market
Brand name
A brand is first and foremost a name - Some names immediately convey information - Some names suggest their benefit - Some names are those of their founder
AIDA (what do letters stand for?)
A= Attention: Do customers know about us? I= Interest: Would customers consider us? D= Desire: Do customers want us and look for us? A= Action: Do customers buy us, talk and post about us?
Endorsements
Ads that feature a spokesperson on behalf of the brand
Marketing campaign/comms
Advertising (tv, radio, print), digital, point of sale, events, PR
"Incrementally new" products
An improvement over a previously launched product. Ex. laptop
Credence qualities
Are difficult to assess even post-consumption, so you have to believe they are good. (trusting your doctor)
Maturity stage goal (Product life cycle)
Attract additional new buyers
Search qualities
Can be evaluated prior to purchase (seeing the merchandise)
Celebrity endorsement
Company wants positive associations to transfer to the brand
Concept testing
Concept is developed and tested with customers. 1. Concept statement 2. Concept board 3. Product prototype
Category extensions
Different product line (breadth)- Nike
Breadth
Different product lines
Growth stage goal (Product life cycle)
Encourage product loyalty
Influencer Endorsements
Endorses brands on social media
Affect Advertising
Enhancing attitudes and positive associations about the brand.
Seasonal media
Infrequent and focused on the preterm season for the product (holiday, back to school)
Services are tangible or intangible?
Intangible- you do not take home a concrete product.
"New to the world" products
Inventions that create a new category of products. Ex. flip phone *Not many "new to the world" innovation*
Brand extensions
Leverage brand's good name to get customers to buy something new
Bottom up (outside-in or co-creation)
New products created "with the customer" Feedback from outside can come throughout the process, common in marketing-oriented companies, Marketing is involved throughout the New Product Development process, typically leading it.
Ingredient branding
One company and product is the primary host and the other adds value to the host - Intel inside
Experience attributes
Ones that need some trial or consumption before evaluation.
Decline stage goal (Product life cycle)
Preserve as much profitability as possible
Depth
Products within the product line
Rank
Provides the pieces of content that will best answer a searcher's query.
Expert endorsements
Purchase is less risky because of advice of a knowledgeable, credible person.Ex. doctor
GRP's
Reach X Frequency
Continuous media
Regularity in ad exposure depending on purchase cycles
Occasional media
Run ads from time to time
Line extensions
Same product line (depth)- Ben and Jerrys
Testimonial Endorsements
Satisfied customer that customers can relate to
Perishability
Services are more perishable than goods.
Product Mix
The companies assortment of products
Focus Groups
The market research technique that brings together a small group from the target market to gain feedback on a new product or marketing program - 8-10 target customers - Gives early feedback on a topic - Qualitative research
User journeys
The pathway a person follows as they discover a product, service, or brand, learn about it, consider spending money on it, and then make a decision.
Retargeting
The process of targeting users who have previously accessed a website, browsed an eCommerce store, or made a purchase online.
Co-Branding
Two companies collaborate in a joint venture to create a good or service. - Cole Haan shoes with Nike Air technology
Behavior Advertising
Ultimately encouraging the desired behaviors. Ex. purchase clicks