Product is Everything
Products are everything that a person receives in an exchange. Specific versions of a product offered by an organization are product items while groups of closely related product items are called a product line. All of the company’s products together are a product mix
There are five consumer product classifications; inexpensive items which require little shopping effort are convenience products. Shopping products are items where consumers compare different brands and the items are usually more expensive than those of convenience products. The third classification would be specialty products such as high end products and consumers will not accept substitute brands. There are also unsought products that consumers don’t actively seek but are found more on a necessity bases such as burial plots or insurance.
Branding of a product allows for distinguishing products from all other competitors because consumers will recognize a brand they consider to be good quality and a product line that they trust. Packaging of a product is sometimes changed in order to attract a new group of consumers. If they want to attract a younger demographic, they will change the logo/label to one that the younger consumers will take notice of. A company is global if they get 1/3 of their revenue from outside of their home country. These companies have to offer products that are based on the local tastes, or styles of the area they are selling in. Labeling for global products also must be properly translated when listing ingredients, and they have to watch what colors are on the labels as some countries have different meanings for different colors which means we may use a color here in the United States that if sent to another country could be very offensive, so it is very important to pay close attention to that.
There are different types of warranties, Express warranties are ones that are written while implied warranties are unwritten guarantees that say the product is fit for the purpose it was sold for. Warranties are to protect the buyers and they give important information about the product that is sold.
Companies must develop new products to continue growing, increase revenue and to replace items that have become obsolete. There are six catagories of new products. The first being new to the world products which are created for an entirely new market, then there are new product lines which are products that have not been offered by the company before. Additions to existing product lines which are developed to supplement and established line, revisions of existing products can have slight changes or significant changes to the existing items. Repositioned products are existing products which are targeted at new markets and finally lower-priced products which are similar to competing brands but are offered at lower prices than the competitors.
The process for developing new products starts with new product strategy which provides general guidelines, followed by idea generation which comes from customers, employees, vendors, R&D and consultants. The next step is the idea screening which eliminates the ideas that are inconsistent with the organization’s new product strategy. The company then has to use the business analysis to estimate and compare cost and revenue for the new product and then the development where the prototype is developed and the marketing strategy, packaging, branding and labeling is all developed. The next step is to test market the product where it is sent to limited market places for introduction. Once all of that is complete, the final step is commercialization where the decision to market the product is made and production materials and equipment are ordered products are shipped to distribution points and advertising is all started.
The concepts of the life cycle are first the introduction, where a full scale launch of the product begins, that moves to the growth when sales grow at an increasing rate and then the maturity of a product which is the longest stage, where the sales increase at a decreasing rate and it finally leads to a decline when there is a long running drop in sales.