| Question |
Answer |
| The Core Product |
all the benefits the product will provide for consumers or business customers Ex- Car provides transportation, carries cargo, enhances image, etc |
| The Actual Product |
the physical good or the delivered service that supplies the desired benefit Ex-Car's engine size, color, interior, body size, model, name, options, etc |
| The Augmented Product |
The actual product plus other supporting features such as a warranty, credit, deliver, installation, and repair service after the sale Ex-Car-free oil changes, 100,000 mile warranty, 2.9% interest auto loan, etc |
| classifications of business products |
Equipment, Maintenance Repair & Operating (MRO) products, Raw Materials, Processed Materials, Specialized Services, Component Parts |
| classifications of consumer products |
Durable, Non-durable, Convenience Products, Shopping Products, Specialty Products, Unsought Products |
| Differences in classifying business and consumer products |
business products are classified by how organizational customers use them, consumer products are classified by how long they last |
| Unsought Products |
goods or services for which a consumer has little awareness or interest until a need arises (retirement plans) |
| Specialty Products |
a good or service that has unique characteristics and is important to the buyer and for which she will devote significant effort to acquire (rolex watch) |
| Shopping Products |
a good or service for which consumers spend considerable time and effort gathering information and comparing alternatives before making a purchase (laptop) |
| Convenience Products |
A consumer good or service that is usually low-priced, widely available, and purchase frequently with a minimum of comparison and effort *staple items, impulse products, emergency products* |
| durable vs non-durable goods |
provide benefits over long period of time (cars, furniture) : provide benefits for a short time because they are consumed or are no longer useful (newspapers, food) |
| Continuous Innovations |
a modification to an existing product that sets one brand apart from its competitors - consumers don't have to learn anything new |
| dynamically continuous innovations |
a pronounced modification to an existing product that requires a modest amount of learning or change in behavior to use it - records to 8 tracks to cassettes to CDs to Mp3 |
| discontinuous innovations |
a totally new product that creates major changes in the way we live - inventions of cars, planes, PC, TV, etc - tough to plan, usually only visible in hindsight |
| 3 types of innovations |
continuous, dynamically continuous, discontinuous |
| product development phases |
1. idea generation 2.product concept development and screening 3.marketing strategy development 4.business analysis 5.technical development 6.test marketing 7.commercialization |
| idea generation |
product development phase 1 in which marketers brainstorm for products that provide customer benefits and are compatible with the company mission |
| product concept development & screening |
2nd phase in the new product development in which marketers test product ideas for technical and commercial success |
| marketing strategy development |
3rd phase of the new product development in which marketers develop a marketing strategy to introduce the product to the marketplace |
| business analysis |
the 4th step in the new product development process in which marketers assess a product's commercial viability |
| commercialization |
the final stage in the product development process in which a new product is launched into the market - launching, distribution, advertising, sales promotion, etc |
| test marketing |
phase 6 in the new product development process involving testing the complete marketing plan in a small geographic area that is similar to the larger market the firm hopes to enter |
| technical development |
phase 5 in the new product development process in which company engineers refine and perfect a new product |
| variability |
the characteristic of a service that means that even the same service performed by the same individual can vary - mktrs respond by offering quality guarantees, institute TQM, gap analysis |
| stages in consumers adoption of a new product |
awareness, interest, evaluation, trial, adoption, confirmation |
| perishability |
*use it or lose it* the characteristic of a service that makes it impossible to store for later sale or consumption - mktrs try to avoid by encouraging demand or matching supply with demand (capacity management) |
| Innovators |
the first segment (2.5%) of a population to adopt a new product |
| late majority vs laggards |
(34%) the adopters who are willing to try new products when there is little or no risk associated w/ the purchase when the purchase becomes an economic necessity or when theres social pressure to purchase : (16%) the last consumers to adopt an innovation |
| early majority |
those whose adoption of a new product signals a general acceptance of the innovation (34%) |
| early adopters |
those who adopt a new product early in the diffusion process, but after the innovators (13.5%) |
| awareness |
1st step in the adoption process - educating consumers about a new product - mktrs may conduct a mediablitz or massive advertising campaign |
| interest |
a prospective adopter begins to see how a new product might satisfy an existing or newly realized need |
| evaluation |
we weigh the costs and benefits of the new product |
| trial |
when potential buyers will actually experience or use the product for the first time |
| adoption |
a prospect actually buys the product |
| confirmation |
a customer weighs expected vs. actual benefits and costs |
| diffusion of innovations - adopter categories |
innovators, early adopters, early majority, late majority, laggards |
| product factors affecting the rate of adoption |
relative advantage, compatibility, complexity, trialability, observability |
| observability |
how visible a new product and its benefits are to others who might adopt it |
| complexity |
the degree to which consumers find a new product or its use difficult to understand |
| trialability |
the ease of sampling a new product and its benefits |
| relative advantage |
the degree to which a consumer perceives that a new product provides superior benefits |
| compatibility |
the extent to which a new product is consistent with existing cultural values, customs, and practices |
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