PM--Chapter09Product-Mix Strategy(营销原理)

Sony’s palm. LINE EXTENSION is to add a similar item to an existing product line with the same brand name e.g., Toyota Camry.

To appeal to more market segments
Product-Mix Strategies
Product Alteration means improving the existing products or package of product.

Less risky and more profitable
Product-Mix Contraction (Pruning) is carried out either by eliminating an entire line or by simplifying the assortment within a line. To gain higher profits from fewer products.
Product-Mix Strategies
Positioning the Product
1. Positioning in Relation to a Competitor
Positioning directly against the competition Suitable for a firm that already has a solid differential advantage or is trying to solidify such an advantage. Head-to-head positioning should be avoided when a competitor has a strong market position. It is better for an underdog to be the opposite of the market leader.
3. Positioning by Price and Quality

Known for their high-quality products and high prices or low price, moderate quality e.g. La Mer cosmetic, Emporium Dept.Store, Lotus
Positioning the Product
2. Positioning in Relation to a Product
Class or Attribute

Associating its product with (or distancing it from) a product class or attribute
Ch. 9: Product-Mix Strategy
Chapter 9
Skip

Marketing Considerations in Fashion (p. 258-259)
Product Mix/Assortment
is the set of all products and items that a particular seller offer for sales to buyers.
Trading up is to add a higher-price product to a company’s product line e.g., Lexus.


groups of customers. Disadvantage: The new offering may cloud the established image.
Strategies
Managing during Maturity

To maintain or to boost sales by line extension, product modification, new promotion, and new uses for the product.
Points to consider
Life Cycle is Related to a Market

A specific stage of product life cycle refers to a specific market as the pdt may be well accepted in some mkts, but not yet in some.
Product-Mix Strategies
Product-mix expansion---increasing the
number of lines a firm offers to customers and/or the depth within a particular line. MIX EXTENSION is to add a new product line to the company’s present assortment e.g.,
Characteristics of Each Stage
INTRODUCTION or PIONEERING STAGE –
new product is launched into the market in a full-scale marketing program. Stimulate demand for the entire product category Develop the product and seek consumer acceptance
Length of Product Life Cycle
Three variations on the life cycle: Extended introduction stage – the product gains widespread consumer acceptance only after an extended introductory period. Fad – the entire life cycle begins and ends in a relatively short period of time e.g., Tamagoti. Indefinite maturity stage – the product’s mature stage lasts almost indefinitely e.g., rice, computers, TVs, etc.
DECLINE STAGE – occurs when:

A better or less expensive product is developed to fill the same need e.g., mailing VS e-mailing, typewriters VS computers.
GROWTH or MARKET-ACCEPTANCE STAGE
– sales and profit rise at a rapid rate.

Competitors enter the market as the mkt is growing (very attractive). Profits start to decline due to reduction in price.
Points to consider
Rapid changes in technology can make product life cycles get shorter. A product can quickly move into maturity stage if competitors can develop me-too products. Some products fail in introductory stage. Not every brand can proceed through all four life-cycle stages.



The profit curve for most new products is negative through much of the introductory stage. Toward the end of the growth stage, the profit curve starts to decline while sales volume is still rising. Introducing a new product at the proper time will help maintain a company’s desired level of profit as well as premium price.
Life-Cycle Management

Predicting the shape of the cycle Adapting marketing strategies at each stage of the life cycle
Strategies
Entry Strategies (Introduction) Enter during the introduction stage
First-mover advantage (pioneer advantage)

Delay the entry
Wait until the market is proven to be successful.
Managing on the Rise (Growth) Determining the number of competitors and how well the brand performs