Chapter 7<\/p>\n
\u00a0<\/p>\n
Target marketing:\u00a0Dividing the total market into different segments based on customer characteristics, selecting one or more segments, and developing products to meet those segments\u2019 needs<\/p>\n
\u00a0<\/p>\n
Market segmentation\u00a0is the process that companies use to divide large heterogeneous markets into small markets that can be reached more efficiently and effectively with products and services that match their unique needs.<\/p>\n
\u00a0<\/p>\n
Segmentation: Identify and describe market segments<\/p>\n
Targeting: Evaluate segments and decide which one to pursue<\/p>\n
Positioning: Design a product and marketing mix to meet the segment\u2019s needs<\/p>\n
Differentiation: Differentiate the firm\u2019s market offering to create superior customer value<\/p>\n
Positioning: A market offering occupying a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.<\/p>\n
\u00a0<\/p>\n
Geographic\u00a0segmentation calls for dividing the market into different geographical units such as nations, regions, states, counties, cities, or even neighborhoods.<\/p>\n
Demographic\u00a0segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality.<\/p>\n
\u00a0<\/p>\n
Family Life Cycle<\/p>\n
Because family needs and expenditures change over time, one way to segment consumers is to consider the stage of the family life cycle they occupy.<\/p>\n
Furniture is a product category that varies with the family life cycle.<\/p>\n
\u00a0<\/p>\n
Psychographic\u00a0segmentation divides buyers into different groups based on social class, lifestyle, or personality traits.<\/p>\n
Behavioral\u00a0segmentation divides buyers into groups based on their knowledge, attitudes, uses, or responses to a product.<\/p>\n
Occasion\u00a0segmentation is grouping buyers according to occasions when they get the idea to buy, actually make their purchase, or use the purchased item.<\/p>\n
Benefit\u00a0segmentation is grouping buyers according to the different benefits that they seek from the product.<\/p>\n
User Status\u00a0is segmenting markets into nonusers, ex-users, potential users, first-time users, and regular users of a product.<\/p>\n
Usage Rate\u00a0is grouping markets into light, medium, and heavy product users.<\/p>\n
Loyalty Status\u00a0is dividing buyers into groups according to their degree of loyalty.<\/p>\n
\u00a0<\/p>\n
Consumer and business marketers use many of the same variables to segment their markets.<\/p>\n
Business marketers also use some additional variables, such as customer operating characteristics, purchasing approaches, situational factors, and personal characteristics.<\/p>\n
\u00a0<\/p>\n
Companies can segment\u00a0international\u00a0markets using one or a combination of several variables.<\/p>\n
Geographic\u00a0factors: Nations close to one another will have many common traits and behaviors.<\/p>\n
Economic\u00a0factors: Population income levels and overall level of economic development<\/p>\n
Political and legal\u00a0factors: Type and stability of government, receptivity to foreign firms, monetary regulations, and the amount of bureaucracy<\/p>\n
Cultural\u00a0factors: Common languages, religions, values and attitudes, customs, and behavioral patterns<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
Substantial: The market segments are large or profitable enough to serve.<\/p>\n
Is the market large enough to make a profit?\u00a0 Marketers need to be careful because there is often heavy competition for the larger segments.<\/p>\n
Accessible: The market segments can be effectively reached and served.<\/p>\n
Is the segment accessible with media in an efficient manner.\u00a0<\/p>\n
Actionable: Effective programs can be designed for attracting and serving the segments.<\/p>\n
Differentiable: The segments are conceptually distinguishable and respond differently to different marketing mix elements and programs.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
In evaluating different market segments, a firm must look at three factors:<\/p>\n
Segment size and growth<\/p>\n
Segment structural attractiveness, and<\/p>\n
Company objectives and resources.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
The largest, fastest-growing segments are not always the most attractive ones for every company. The company also needs to examine major structural factors that affect long-run segment attractiveness.<\/p>\n
A segment is less attractive if it already contains many strong and aggressive competitors. The existence of many actual or potential substitute products may limit prices and the profits.<\/p>\n
The relative power of buyers also affects segment attractiveness. A segment may be less attractive if it contains powerful suppliers who can control prices.<\/p>\n
\u00a0<\/p>\n
A\u00a0target market\u00a0consists of a set of buyers who share common needs or characteristics that the company decides to serve.<\/p>\n
An\u00a0undifferentiated\u00a0strategy is one that essentially avoids segmentation, appealing to a wide-spectrum of people. Products such as anti-freeze or candy bars use this type of approach.<\/p>\n
\u00a0<\/p>\n
A company that chooses a\u00a0differentiated\u00a0strategy develops separate marketing programs for several segments of the market.\u00a0 This is a costly approach that is usually reserved for larger firms such as Nike, Toyota, or GE.<\/p>\n
Differentiated marketing targets several different market segments and designs separate offers for each.<\/p>\n
\u00a0<\/p>\n
Micromarketing\u00a0is the practice of tailoring products and marketing programs to suit the tastes of specific individuals and locations. It includes local marketing and individual marketing.<\/p>\n
Local marketing involves tailoring brands and promotions to the needs and wants of local customer groups\u2014cities, neighborhoods, and even specific stores.<\/p>\n
Individual marketing has also been labeled one-to-one marketing, mass customization, and markets-of-one marketing.<\/p>\n
\u00a0<\/p>\n
Product\u00a0position\u00a0is the way the product is defined by consumers on important attributes\u2014the place the product occupies in consumers\u2019 minds relative to competing products.<\/p>\n
\u00a0<\/p>\n
Positioning\u00a0maps\u00a0show consumer perceptions of their brands versus competing products on important buying dimensions<\/p>\n
\u00a0<\/p>\n
The differentiation and positioning task consists of three steps:<\/p>\n
Identifying a set of differentiating competitive advantages upon which to build a position,<\/p>\n
Choosing the right competitive advantages, and<\/p>\n
Selecting an overall positioning strategy.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
To the extent that a company can differentiate and position itself as providing superior customer value, it gains\u00a0competitive advantage.<\/p>\n
\u00a0<\/p>\n
Important: The difference delivers a highly valued benefit to target buyers.<\/p>\n
Distinctive: Competitors do not offer the difference, or the company can offer it in a more distinctive way.<\/p>\n
Superior: The difference is superior to other ways that customers might obtain the same benefit.<\/p>\n
Communicable: The difference is communicable and visible to buyers.<\/p>\n
Preemptive: Competitors cannot easily copy the difference.<\/p>\n
Affordable: Buyers can afford to pay for the difference.<\/p>\n
Profitable: The company can introduce the difference profitably.<\/p>\n
\u00a0<\/p>\n
Value proposition\u00a0is the full mix of benefits upon which a brand is positioned.<\/p>\n
Chapter 8<\/p>\n
\u00a0<\/p>\n
A\u00a0product\u00a0is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need.<\/p>\n
Broadly defined, \u201cproducts\u201d also include services, events, persons, places, organizations, ideas, or mixes of these.<\/p>\n
To differentiate their offers, marketers create and manage customer experiences with their brands or company.<\/p>\n
\u00a0<\/p>\n
Services\u00a0are a form of product that consist of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything.<\/p>\n
A company\u2019s market offering often includes both tangible goods and intangible services.<\/p>\n
At one extreme, the offer may consist of a pure tangible good, such as soap or toothpaste.<\/p>\n
At the other extreme, the offer may consist of a pure services.<\/p>\n
\u00a0<\/p>\n
A product is made up of the core product, the actual product, and the augmented product.<\/p>\n
Core Product: all the benefits the product will provide for consumers or business customers<\/p>\n
Actual Product:\u00a0 the physical good or the delivered service that supplies the desired benefit; also includes the unique features of the product, such as its appearance or styling, the package, and the brand name<\/p>\n
Augmented Product: the actual product plus other supporting features such as warranty, credit, delivery, installation, and repair service after the sale<\/p>\n
\u00a0<\/p>\n
There are two main classification of products: consumer products and industrial products.<\/p>\n
\u00a0<\/p>\n
Marketers classify products based on how customers shop for them.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
Convenience\u00a0products are consumer products and services that customers usually buy frequently, immediately, and with a minimum of comparison and buying effort.<\/p>\n
Shopping\u00a0products are less frequently purchased consumer products and services that customers compare carefully on suitability, quality, price, and style.<\/p>\n
Specialty\u00a0products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort.<\/p>\n
Unsought\u00a0products are consumer products that the consumer either does not know about or knows about but does not normally think of buying.<\/p>\n
Industrial\u00a0products are those purchased for further processing or for use in conducting a business.<\/p>\n
The three groups of industrial products and services are:\u00a0materials and parts, capital items, and supplies and services.<\/p>\n
Materials and parts include manufactured materials and parts, and raw materials, like farm products and natural products.<\/p>\n
\u00a0<\/p>\n
Capital items\u00a0are industrial products that aid in the buyer\u2019s production or operations, including installations and accessory equipment.<\/p>\n
\u00a0<\/p>\n
Supplies and services\u00a0include operating supplies and maintenance and repair services.<\/p>\n
\u00a0<\/p>\n
Person marketing\u00a0consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular people<\/p>\n
Place\u00a0marketing\u00a0consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular places.<\/p>\n
Social marketing\u00a0is the use of commercial marketing concepts and tools in programs designed to influence individuals\u2019 behavior to improve their well-being and that of society.<\/p>\n
Developing a product involves defining its\u00a0attributes\u00a0such as quality, features, and style and design.<\/p>\n
Product Quality\u00a0has two dimensions: level and consistency. The quality level means performance quality or the ability of a product to perform its functions. Quality conformance means quality consistency, freedom from defects, and consistency in delivering a targeted level of performance.<\/p>\n
Product Features\u00a0are a competitive tool for differentiating the company\u2019s product from competitors\u2019 products.<\/p>\n
The company should periodically survey buyers who have used the product and ask these questions: How do you like the product? Which specific features of the product do you like most? Which features could we add to improve the product?<\/p>\n
Product Style and Design\u00a0is another way to add customer value.<\/p>\n
Style describes the appearance of a product. Design contributes to a product\u2019s usefulness as well as to its looks.<\/p>\n
\u00a0<\/p>\n
A\u00a0brand\u00a0is a name, term, sign, symbol, or design, or a combination of these, that identifies the maker or seller of a product or service.<\/p>\n
Brand names:<\/p>\n
–help consumers identify products that might benefit them.<\/p>\n
–say something about product quality and consistency.<\/p>\n
–become the basis on which a whole story can be built about a product.<\/p>\n
–provide legal protection for unique product features.<\/p>\n
–help the seller to segment markets.<\/p>\n
\u00a0<\/p>\n
A\u00a0package\u00a0is the covering or container for a product, but it is also a lot more.<\/p>\n
Packaging protects the product. It makes it easy for consumers to handle and store the product. Packaging also plays an important role in communicating brand personality.<\/p>\n
\u00a0<\/p>\n
Labels\u00a0identify the product or brand, describe attributes, and provide promotion.<\/p>\n
Companies must continually assess the value of current\u00a0services\u00a0to obtain ideas for new ones.\u00a0 They also need to develop a package of services to satisfy customers and provide profit to the company.<\/p>\n
\u00a0<\/p>\n
Product line\u00a0is a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges<\/p>\n
Product line length\u00a0is the number of items in the product line.<\/p>\n
Product line filling\u00a0involves adding more items within the present range of the line.<\/p>\n
Product line stretching\u00a0occurs when a company lengthens its product line beyond its current range. Companies located at the upper end of the market can stretch their lines downward. Companies located at the lower end of the market can stretch their product lines upward. Companies located in the middle range of the market can stretch their lines in both directions.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
A company\u2019s product mix has four dimensions: width, length, depth, and consistency.<\/p>\n
Product mix\u00a0width\u00a0refers to the number of different product lines the company carries.<\/p>\n
Product mix\u00a0length\u00a0refers to the total number of items the company carries within its product lines.<\/p>\n
Product mix\u00a0depth\u00a0refers to the number of versions offered of each product in the line.<\/p>\n
Product mix\u00a0consistency\u00a0refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way.<\/p>\n
The company can increase its business in four ways.<\/p>\n
1. It can add new product lines, widening its product mix.<\/p>\n
2. It can lengthen its existing product lines.<\/p>\n
3. It can add more versions of each product, deepening its product mix.<\/p>\n
4. It can pursue more product line consistency.<\/p>\n
\u00a0<\/p>\n
Brand\u00a0represents the consumer\u2019s perceptions and feelings about a product and its performance. It is the company\u2019s promise to deliver a specific set of features, benefits, services, and experiences consistently to the buyers.<\/p>\n
Brand strategy decisions include:<\/p>\n
–Product attributes<\/p>\n
–Product benefits<\/p>\n
–Product beliefs and values<\/p>\n
A good brand name should suggest something about the product\u2019s\u00a0benefits\u00a0and qualities. Examples: Beautyrest, Die Hard, Intensive Care, Curves (women\u2019s fitness centers)<\/p>\n
It should be\u00a0easy\u00a0to pronounce, recognize, and remember: Tide, Silk, iPod Touch, JetBlue.<\/p>\n
The brand name should be\u00a0distinctive: Lexus, Zappos.<\/p>\n
\u00a0It should be\u00a0extendable: Amazon.com began as an online bookseller but chose a name that would allow expansion into other categories.<\/p>\n
The name should translate easily into\u00a0foreign\u00a0languages. Before changing its name to Exxon, Standard Oil of New Jersey rejected the name Enco, which it learned meant a stalled engine when pronounced in Japanese.<\/p>\n
\u00a0<\/p>\n
A manufacturer has four sponsorship options:<\/p>\n
–product launched as a manufacturer\u2019s brand (or national brand)<\/p>\n
–manufacturer sells to resellers who give it a private brand<\/p>\n
–manufacturer can market licensed brands<\/p>\n
–two companies can join forces and co-brand a product<\/p>\n
\u00a0<\/p>\n
National Brands Versus Store Brands<\/p>\n
In the battle of the brands between national and private brands, retailers have many advantages.<\/p>\n
–Retailers price their store brands lower than comparable national brands.<\/p>\n
–Store brands yield higher profit margins for the reseller.<\/p>\n
–Store brands give resellers exclusive products.<\/p>\n
Co-branding\u00a0occurs when two established brand names of different companies are used on the same product.\u00a0 Co-branding also allows a company to expand its existing brand into a category it might otherwise have difficulty entering alone.<\/p>\n
\u00a0<\/p>\n
A company has four choices when it comes to\u00a0developing\u00a0brands:<\/p>\n
Line Extensions\u00a0occur when a company extends existing brand names to new forms, colors, sizes, ingredients, or flavors of an existing product category.<\/p>\n
Brand Extensions\u00a0extend a current brand name to new or modified products in a new category.<\/p>\n
Multibranding\u00a0introduces additional brands in the same category.<\/p>\n
New Brands.<\/p>\n
\u00a0<\/p>\n
Services:\u00a0Are acts, efforts, or performances exchanged from producer to user without ownership rights.<\/p>\n
\u00a0<\/p>\n
Intangibility: customers can\u2019t see, touch, or smell a service. Services cannot be inspected or handled before purchase, making evaluation difficult.<\/p>\n
Inseparability:\u00a0it is impossible to separate the production of a service from the consumption of that service.<\/p>\n
Variability:\u00a0the same service, even if performed by the same individual for the same customer, can vary.<\/p>\n
Perishability:\u00a0it is impossible to store a service for later sale or consumption.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
Service-profit chain\u00a0consists of five links:<\/p>\n
Internal service quality: superior employee selection and training, a quality work environment, and strong support for those dealing with customers, which results in…<\/p>\n
Satisfied and productive service employees: more satisfied, loyal, and hardworking employees, which results in…<\/p>\n
Greater service value: more effective and efficient customer value creation and service delivery, which results in…<\/p>\n
Satisfied and loyal customers: satisfied customers who remain loyal, repeat purchase, and refer other customers, which results in…<\/p>\n
Healthy service profits and growth: superior service firm performance.<\/p>\n
\u00a0<\/p>\n
Internal marketing\u00a0means that the service firm must orient and motivate its customer-contact employees and supporting service people to work as a team to provide customer satisfaction.<\/p>\n
Internal marketing must precede external marketing<\/p>\n
\u00a0<\/p>\n
Interactive marketing\u00a0means that service quality depends heavily on the quality of the buyer-seller interaction during the service encounter.<\/p>\n
\u00a0<\/p>\n
Service companies face three major marketing tasks: They want to increase their service differentiation, service quality, and service productivity.<\/p>\n
Managing Service Differentiation<\/p>\n
Service companies can differentiate their service delivery by having more able and reliable customer-contact people, by developing a superior physical environment in which the service product is delivered, or by designing a superior delivery process.<\/p>\n
Service companies can work on differentiating their images through symbols and branding.<\/p>\n
Managing Service Quality<\/p>\n
Service quality is harder to define and judge than product quality. Service quality will always vary, depending on the interactions between employees and customers.<\/p>\n
Good service recovery can turn angry customers into loyal ones.<\/p>\n
Managing Service Productivity<\/p>\n
Service firms are under great pressure to increase service productivity. They can train current employees better or hire new ones who will work harder or more skillfully.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
Chapter 9<\/p>\n
\u00a0<\/p>\n
Competition in our global marketplace makes it essential for firms to continuously offer new products to attract consumers.<\/p>\n
However, successful new-product introductions are becoming more and more difficult. Problems include the high costs of R&D and competition for retailer shelf space.<\/p>\n
New product development\u00a0refers to original products, product improvements, product modifications, and new brands developed from the firm\u2019s own research and development<\/p>\n
Many new products fail because of meager competitive advantages, overestimation of market size, poor product positioning, poor marketing mix, or bad timing.<\/p>\n
\u00a0<\/p>\n
Idea generation\u00a0is the systematic search for new-product ideas.<\/p>\n
Marketers use a variety of sources to come up with ideas that provide strong customer benefits and that are compatible with the company mission. These ideas can come from customers, salespeople, service providers, etc. Research is often conducted to come up with new product ideas.<\/p>\n
\u00a0<\/p>\n
Internal Idea Sources:\u00a0here the company finds new ideas through formal research and development. Or it can pick the brains of employees\u2014from executives to scientists, engineers, and manufacturing staff to salespeople.<\/p>\n
External Idea Sources: good new-product ideas can also emerge from sources such as distributors, suppliers or even competitors.<\/p>\n
Perhaps the most important source of new-product ideas is customers themselves.<\/p>\n
\u00a0<\/p>\n
The first idea-reducing stage is\u00a0idea screening, which helps spot good ideas and drop poor ones as soon as possible.<\/p>\n
In screening, ideas are expanded into more complete product concepts. When screening, marketers and researchers examine the chances that the product concept might achieve technical and commercial success.<\/p>\n
\u00a0<\/p>\n
In\u00a0concept development, several descriptions of the product are generated to find out how attractive each concept is to customers. From these concepts, the best one is chosen.<\/p>\n
A\u00a0product idea\u00a0is an idea for a possible product that the company can see itself offering to the market.<\/p>\n
A\u00a0product concept\u00a0is a detailed version of the idea stated in meaningful consumer terms.<\/p>\n
A\u00a0product image\u00a0is the way consumers perceive an actual or potential<\/p>\n
\u00a0<\/p>\n
Concept testing\u00a0refers to testing new-product concepts with groups of target consumers<\/p>\n
\u00a0<\/p>\n
Marketing strategy development\u00a0is designing an initial marketing strategy for introducing a product to the market.<\/p>\n
The marketing strategy statement consists of three parts.<\/p>\n
1. A description of the target market; the planned value proposition; and the sales, market share, and profit goals for the first few years.<\/p>\n
2. Outline of the product\u2019s planned price, distribution, and marketing budget for the first year.<\/p>\n
3. Description of the planned long-run sales, profit goals, and marketing mix strategy.<\/p>\n
\u00a0<\/p>\n
Business analysis\u00a0involves a review of the sales, costs, and profit projections for a new product to find out whether they satisfy the company\u2019s objectives.<\/p>\n
A business analysis is conducted to find out if a product can be profitable. Issues here include potential demand and required firm resources for successful development.<\/p>\n
\u00a0<\/p>\n
In\u00a0product development, R&D or engineering develops the product concept into a physical product.<\/p>\n
The product development step calls for a large jump in investment.<\/p>\n
Test marketing\u00a0is the stage at which the product and marketing program are introduced into realistic market settings.<\/p>\n
\u00a0<\/p>\n
Standardized Test Markets\u00a0occur when the company finds a small number of representative test cities, conducts a full marketing campaign in these cities, and uses store audits, consumer and distributor surveys, and other measures to gauge product performance. Drawbacks include costs, time and risk of competitor scooping up the idea.<\/p>\n
Controlled Test Markets\u00a0track individual consumer behavior for new products from television set to the checkout counter. These markets are composed of stores that have agreed to carry new products for a fee. Such test markets provide in-depth purchasing data not possible with retail point-of-sale data alone. Also, the system allows companies to evaluate their specific marketing efforts.<\/p>\n
Simulated Test Markets\u00a0are basically simulated shopping environments. The company shows ads and promotions for a variety of products, including the one being tested, to a sample of consumers. It gives consumers a small amount of money and invites them to a store where they may keep the money or use it to buy items.<\/p>\n
\u00a0<\/p>\n
Commercialization\u00a0is introducing the new product into the market.<\/p>\n
Decisions must be made concerning: timing, where to launch the new product, and how to implement the market rollout.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
New product development must be customer centered and take a team based and systematic approach.<\/p>\n
\u00a0<\/p>\n
Customer-centered\u00a0new product development focuses on finding new ways to solve customer problems and create more customer satisfying experiences<\/p>\n
\u00a0<\/p>\n
In order to get their new products to market more quickly, many companies use a\u00a0team-based\u00a0new-product development approach.<\/p>\n
Under this approach, company departments work closely together in cross-functional teams, overlapping the steps in the product development process to save time and increase effectiveness.<\/p>\n
Instead of passing the new product from department to department, the company assembles a team of people from various departments that stay with the new product from start to finish.<\/p>\n
\u00a0<\/p>\n
An\u00a0innovation management system\u00a0can be used to collect, review, evaluate, and manage new-product ideas.<\/p>\n
The innovation management system approach helps create an innovation-oriented company culture yielding a larger number of new-product ideas.<\/p>\n
\u00a0<\/p>\n
Product Life Cycle is the way products go through stages from development to death.<\/p>\n
The cycle has five distinct stages:<\/p>\n
Product development\u00a0begins when the company finds and develops a new-product idea.\u00a0<\/p>\n
Introduction\u00a0is a period of slow sales growth as the product is introduced in the market. Profits are nonexistent in this stage because of the heavy expenses of product introduction.<\/p>\n
Growth\u00a0is a period of rapid market acceptance and increasing profits.<\/p>\n
Maturity\u00a0is a period of slowdown in sales growth because the product has achieved acceptance by most potential buyers. Profits level off or decline because of increased marketing outlays to defend the product against competition.<\/p>\n
Decline\u00a0is the period when sales fall off and profits drop.<\/p>\n
\u00a0<\/p>\n
The PLC can be applied to styles, fashions, and fads.<\/p>\n
A\u00a0style\u00a0is a basic and distinctive mode of expression.<\/p>\n
A\u00a0fashion\u00a0is a currently accepted or popular style in a given field.<\/p>\n
Fads\u00a0are temporary periods of unusually high sales driven by consumer enthusiasm and immediate product or brand popularity.<\/p>\n
\u00a0<\/p>\n
During\u00a0introduction, customers get the first chance to purchase the good or service.<\/p>\n
The goal is to get first-time buyers to try the product. Sales usually increase at a steady but slow pace. The company usually does not make a profit during this stage because of heavy costs for R&D and promotion.<\/p>\n
An introduction stage can be quite long. Not all products make it past the introduction stage. Nearly 40 percent of all new products fail.<\/p>\n
Marketing during this stage often focuses on informing consumers about the product, how to use it, and its promised benefits.<\/p>\n
\u00a0<\/p>\n
In the\u00a0growth\u00a0stage, sales increase rapidly while profits increase and peak. Marketing\u2019s goal is to encourage brand loyalty by convincing the market that this brand is superior to others. In this stage, marketing strategies may include the introduction of product variations to attract market segments and price cuts.<\/p>\n
\u00a0<\/p>\n
The\u00a0maturity\u00a0stage of the product life cycle is usually the longest. Sales peak and then begin to level off and even decline while profit margins narrow.<\/p>\n
Competition grows intense when remaining competitors fight for their share of a shrinking pie. Price reductions and reminder advertising may be used to maintain market share. During the maturity stage, firms will try to sell their product through as many outlets as possible because availability is crucial in a competitive market.<\/p>\n
\u00a0<\/p>\n
The\u00a0decline\u00a0stage of the product life cycle is characterized by a decrease in product category sales. Although a single firm may still be profitable, the market as a whole shrinks.\u00a0 Profits decline and suppliers pull out. In this stage, there are usually many competitors, with none having a distinct advantage.<\/p>\n
A firm\u2019s major product decision in the decline stage is whether or not to keep the product. If the firm decides to keep the product, advertising and other marketing communications may be decreased to cut costs, and prices may be reduced if the product can remain profitable.<\/p>\n
If the firm decides to drop the product, it can either phase it out by cutting production in stages and letting existing stocks run out or simply drop the product immediately.<\/p>\n
\u00a0<\/p>\n
International\u00a0product and service marketers face special challenges.<\/p>\n
They must figure out what products and services to introduce and in which countries. They must decide how much to standardize or adapt their products and services for world markets.<\/p>\n
Packaging also presents challenges for international marketers.<\/p>\n","protected":false},"excerpt":{"rendered":"
Chapter 7 \u00a0 Target marketing:\u00a0Dividing the total market into different segments based on customer characteristics, selecting one or more segments, and developing products to meet those segments\u2019 needs \u00a0 Market segmentation\u00a0is the process that companies use to divide large heterogeneous markets into small markets that can be reached more efficiently and effectively with products and […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[10],"class_list":["post-93935","post","type-post","status-publish","format-standard","hentry","category-research-paper-writing","tag-writing"],"_links":{"self":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/posts\/93935","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/comments?post=93935"}],"version-history":[{"count":0,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/posts\/93935\/revisions"}],"wp:attachment":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/media?parent=93935"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/categories?post=93935"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/tags?post=93935"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}