Term
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Definition
benefits the consumer will receive when buying the product.
Marketer must focus on: 1. Creating a product/service with better value than althernatives. 2. Crafting marketing communication messages in a manner that convinces customers that the product is better than the competition. |
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Term
| Product(of value proposition) |
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Definition
| Tangible good, service, or idea that satisfy needs, a bundle of attributes |
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Term
| Good (of value proposition) |
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Definition
| A tangible product, something we can see, touch, smell, hear, taste, or possess. |
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Term
| Intangible products (of value proposition) |
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Definition
| Services, ideas, people, and places |
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Term
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Definition
| Core Product, Actual Product, Augmented Product |
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Term
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Definition
| all the benefits that the product will provide |
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Term
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Definition
physical good or delivered service that supplies the desired benefit.
Includes: appearance, styling, packaging, & the brand |
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Definition
| Actual product plus supporting features such as warranty, credit, delivery, repair service, installation. |
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Definition
| Goods that provide benefits over a period of time. Ex. furniture, appliances, cars |
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Definition
| Goods that are consumed in the short term. Ex. newspapers, beverages, printer cartridges. |
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Term
| Classification of Products |
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Definition
Consumer (convenience, shopping, specialty, unsought) and Business (Equipment, Mainenance/Repair/Operating, Raw Materials, Processed Materials/Special Services, Component Parts)
Some items can be sold to both consumers & businesses |
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Term
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Definition
Consumer products, Frequently purchased items. Nondurable products, purchased w/ minimal time & efforts. Typically low priced
Subtypes:
Staple Products-basic necessities (gas & milk)
Impulse products-bought spur of the moment(candy bars)
Emergency Products-purchased immediately b/c of a dire need (drain cleaner & diapers) |
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Definition
Consumer products that are purchased w/ considerable time & effort
Attribute based-we look for the best possible product
price-based-we visit numerous stores in an attempt to save money (water heater) |
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Definition
Consumer products that have unique characteristics important to buyers. Usually pretty knowledgeable about products, tent to be brand loyal, willing to go out of way to purchase preferred brand
Ex. Rolex Watch |
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Definition
Consumer products that are those in which consumers have little interest until a need arises. Higher priced, more important in long-term than emergency products. Personal selling is key to many of these.
Ex. Burial plots, insurance |
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Term
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Definition
B2B used in daily operations
Ex. machines |
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Term
| Maintenance, Repair, and Operating Goods (MRO) |
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Definition
B2B goods that are consumed relatively quickly.
Ex. broom, nuts/bolts, oil |
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Definition
B2B goods used in the manufacture of finished goods.
Ex. Lumber |
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| Processed materials and Special Services |
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Definition
B2B are raw materials that have been transformed from their original state.
Ex. sheets of steel |
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Definition
B2B goods are manufactured goods that organizations need to complete their own goods.
Ex. tie rods for ears |
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Term
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Definition
| A product that customers perceive to be new and different |
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Term
| What does Federal Trade Commission consider "new"? |
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Definition
Must be entirely new or significantly changed.
Also can only be considered this for 6 months |
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Term
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Definition
Continuous- little change
Dynamically continuous-some change
Discontinuous- extreme change |
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Term
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Definition
A modification to an exisiting product.
The bulk of new products
Sets brands apart from competion, consumers don't need to learn anything new, change is minimal.
Knockoffs-copy (w/slight change) the design of an original copy
ex. new flavors, bigger/smaller |
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Term
| Dynamically Continuous Innovation |
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Definition
A pronounced modification to an existing product-requires a modest amount of learning or behavior change
Audio Products: 8-track tapes, cassette tapes, CDs, MP3s |
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Term
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Definition
Refers to the coming together of 2 or more technologies to create a new system w greater benefit than its parts
Ex. merging of cell phones, camera, games, etc. |
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Term
| Discontinuous Innovations |
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Definition
A totally new product
Creates major changes in the way we live, consumers must engage in a great deal of new learning
Ex. 1st computer, car |
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Term
| How to measure innovation |
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Definition
Very complicated
Measure w/ respect to:
Firms strategy, firm culture, outcomes of innovation |
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Term
| New Product Development (NPD) |
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Definition
| a continuous process of looking for entirely new products or for ways to make an exisiting product better |
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Term
| Reasons new products are becoming more difficult to introduce |
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Definition
-R&D costs are enormous
-products become obsolete faster
-slotting fees are high |
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Term
| Key reasons for new product failure |
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Definition
-creating a product w. no discernable benefit over existing alternatives
-overestimating the size of the market
-poor positioning strategy
-poor implementation of the marketing mx |
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Term
| Phases in new product development |
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Definition
1.Idea generation
2.Product Concept development & screening
3.Marketing Strategy Development
4.Business Analysis
5.Technical Development
6.Test Marketing
7.Commercialization |
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Term
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Definition
1st step in New Product Development.
Involves brainstorming product ideas that provide customer benefits which are compatible w the firms w the firms mission |
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Term
| Product-concept development and screening |
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Definition
2nd step in New Product Development.
Product ideas are tested for technical & commercial success |
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Term
| Marketing Strategy development |
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Definition
3rd step in New Product Development.
Develop a strategy to introduce the product to the marketplace
Identify target market, est. its size, etc. |
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Term
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Definition
4th step in New Product Development.
The products commerical viability is assessed |
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Term
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Definition
5th step in New Product Development.
Firm engineers define & perfect the new product.
-prototypes of test versions of the proposed product are developed (in R&D dept)
-the firm may need to apply for a patent |
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Term
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Definition
6th step in New Product Development.
The complete marketing plan is tested in a small geographic area similar to the larger market |
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Term
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Definition
The new product is launched into the market
Full-scale production, distribution, advertising, and sales promotion are begun
Commercialization is no guarante |
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Term
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Definition
| Process by which a consumer or business customer begins to buy and use a new good, service, or idea |
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Definition
| Process by which the use of a product spreads throughout a population |
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Term
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Definition
The point where a product’s sales spike from a slow climb to a new level is called the tipping point.
Marketers work hard to reach the tipping point as soon as possible, and undertake a variety of actions to reach and motivate consumers during each stage in the consumer adoption process. |
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Term
| Stages in Consumer Adoption of a new product |
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Definition
1.Awareness: provide consumers with information
massive advertising is used
2.Interest: the consumer wants more information-teaser ad. is used
3.Evaluation: the consumer weighs the costs and benefits-impulse purchases made w/ little evaluation
4.Trial: consumer uses the product on a small scale-sales promos and product demos
5.Adoption: the consumer buys the product-expectations vs experience
6.Confirmation: the consumer determines whether or not they are satisfied |
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Term
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Definition
Innovators-2.5
Early Adopters-13.5
Early Majority-34
Late Majority-34
Laggards-16 |
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Term
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Definition
The first to accept a new idea or product
Willing to take risks
Rely heavily on impersonal information sources |
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Term
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Definition
The second to adopt an innovation
Heavy media users
Tend to be concerned with social acceptance
Opinion leaders typically come from this group |
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Term
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Definition
Adopt prior to the mean time of adoption
Deliberate and cautious
Spend more time on the decision process
Slightly above average in education and social status |
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Term
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Definition
Follow the average time of adoption
Older, more conservative
Peers are their primary information source
Below average in education, income and social status
Wait to purchase until the product has become a necessity or there is pressure to adopt |
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Term
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Definition
Last to adopt an innovation
Lower in social class than other categories
Bound by tradition
Product may have already been replaced by another innovation |
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Term
| Product Factors that affect the rate of adoption |
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Definition
Relative advantage
Compatibility
Complexity
Trialability
Observability |
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Term
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Definition
-A product innovation is percieved as better than existing alternatives
-Positively correlated w an innovation's adoption rate
-Exists when a new product offers: better performance, increased comfort, saving in time & effore, or immediacy of reward |
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Term
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Definition
An innovation is perceived to fit into a person’s way of doing things
The greater the compatibility, the more rapid a product’s rate of adoption
Overcome perception of incompatibility through heavy advertising |
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Term
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Definition
The more complex the product, the more slowly a product’s rate of adoption
Overcome perception of complexity with demonstrations, personal selling and emphasis on ease of use |
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Term
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Definition
An innovation can be used on a limited basis prior to making a full-blown commitment
The trial experience reduces the risk of the consumer being dissatisfied |
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Term
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Definition
The user or other people can see the positive effects of new product usage
The higher the visibility, the more rapid the adoption rate |
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