Title: Chapter 10: Developing, Positioning, and Differentiating Products Through the Lifecycle
1Chapter 10 Developing, Positioning, and
Differentiating Products Through the Lifecycle
- New Product Strategy Why do new products fail?
- Inability of the company to up
its offerings to the needs of the customers
2Challenge in Developing New Products
- Need to shorten products time to market
- Reduce time between idea generation and product
availability - Research need for timely and accurate
information tracking competitors and customers
tracking marketing environment - 3. Will customers benefit?
3Challenge in Developing New Products
- Are there manufacturing, marketing, or
distribution cost efficiencies with the new
product? - Does the firm have the needed
and _______________ in RD, manufacturing,
and marketing to successfully develop product? - Adding wood stains to a line of paint totally
new manufacturing effort, raw materials,
technology, etc.
4Chapter 10 Developing, Positioning, and
Differentiating Products Through the Lifecycle
- Positioning act of designing the companys
offering and image to occupy a distinctive place
in the target markets __________
5Positioning according to Ries and Trout
- Positioning is what you do to the of
the prospect. That is, you position the product
in the mind of the prospect (Ries and Trout,
1982) - Hertz worlds largest auto-rental agency
- Coca-Cola worlds largest soft-drink company
- Implications __________________________________
6Competitor strategiesRies and Trout
- Strengthen its own position in the consumers
mind - 2. Grab an unoccupied position
-
- Re-position the competition in the customers
mind
7Competitor strategiesRies and Trout
- 4. In an over-advertised society, the mind often
knows brands in the form of ___________, such as
Coke-Pepsi-RC Cola, or Hertz-Avis-National - The top firm is remembered best.
-
- Implications Fight for
position become number one in a new category
- Exclusive club strategy - promote the idea that
it is one of the Big Three, Top 10, etc. It is
in the club with the best.
8Positioning according to Treacy and Wiersema
- Value Disciplines within its industry, a firm
could aspire to be the product leader, the
operationally excellent firm, or the customer
intimate firm. - Product leader firm advances on the
technological frontier - Operationally excellent firm highly reliable
performance - Customer intimate firm high responsiveness in
meeting individual needs
9Positioning how many ideas to promote?
- Promote central
benefit - Easier communication to target market
- If company hammers away
at one positioning, and delivers on it, it will
probably be best known and recalled for this
benefit
10Positioning how many ideas to promote?
- Promote more than one benefit
- What if the market tires of the benefit and
believes that most competitors deliver it? - Today most people believe that most cars are safe
and that most have pretty good quality.
Therefore, car manufacturers should position
their product on ________________________
11Positioning how many ideas to promote?
- Challenge as companies increase the number of
claimed benefits for their brand, they risk
belief and a loss of clear positioning - 1. ______________ buyers have vague idea of the
brand brand is another entry in a crowded
marketplace when Pepsi introduced Crystal Pepsi
in 1993, consumers were unimpressed. They failed
to see the benefit of clarity in a soft drink
12Positioning how many ideas to promote?
- 2. buyers have
too narrow an image of a brand - 3. brands
positioning is changed too frequently - NeXT desktop computer was positioned for
students, then for engineers, and then for
business people
13Positioning how many ideas to promote?
- 4. hard to
believe brand claims in view of the products
features, price, or manufacturer - When GMs Cadillac division introduced the
Cimarron, it positioned the car as a luxury
competitor with BMW, Mercedes, and Audi.
Although it had all the features of a luxury
vehicle, customers saw it as a dolled up version
of Chevys Cavelier
14Communicating the Companys Positioning
- Positioning statement state the products
membership in category, and then show its
point-of-difference from other members of the
group - Frozen pizza positioned as delivered pizza
Its not delivery, _________________
15Communicating the Companys Positioning
- Communicate positioning through all elements of
the _________________________ - Physical signs and cues a lawnmower manufacturer
claims its lawn mower is powerful and has a
noisy motor because buyers think noisy lawnmowers
are more powerful - Price, packaging, promotion, etc. a premium
beers image was hurt when it switched from
bottles to cans a well-known frozen-food brand
lost its prestige image by being on sale too
often.
16Adding Further Differentiation
- Differentiation adding a set of meaningful and
differences to distinguish the
companys offering from the competitors offerings
17Adding Further Differentiation
- Meaningful or worthwhile differentiation
- Criteria
- Important highly valued
- Distinctive delivered in a distinctive way
- Superior superior to other ways of obtaining
the benefit - Preemptive cannot easily be copied by
competitors - Affordable buyer can afford to pay the
difference - Profitable company will find it profitable to
introduce the difference
18Differentiation that Failed Failure to Meet
Criteria
- Westin Stamford Hotel in Singapore worlds
tallest hotel - Turner Broadcasting System installed TV monitors
to beam Cable News Network (CNN) to shoppers in
checkout lines
19Successful Differentiation on Irrelevant
Attributes
- Proctor Gamble differentiates its Folgers
instant coffee by its flaked coffee crystals
created through a unique patented process - Claiming that a brand of coffee is mountain
grown. - Alberto Natural Silk shampoo We put silk in a
bottle.
20Product Differentiation Tools (p. 204 206)
- Examples
- Features characteristics that
the products basic function - Need to determine which feature is profitable to
add, given the potential market, cast, and price -
21Product Differentiation Tools (p. 204 206)
- Examples
- Repairability measures the ease of
a product when it malfunctions or fails - Style describes the products look and feel to
the buyer can create
that is difficult to copy does not always mean
high performance
22Product Differentiation Tools (p. 204 206)
- Examples
- Design the of features that
affect how a product looks and functions in terms
of customer requirements
23Services Differentiation
- Examples
- Ordering ease ease with which customer can place
an order with a company - Delivery how well the product or service is
delivered to the customer, covering speed
accuracy, and customer care.
24Personnel Differentiation
- Differentiation through better-trained people.
Well-trained personnel exhibit competence,
courtesy, credibility, reliability,
responsiveness, and communication.