Session 3 Product Distribution Pricing Dr.

Yansong Hu
+(0) 24 7652 3915 Yansong.hu@wbs.ac.uk
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MARKETING ANALYSIS Environment Consumer Buyer Behaviour Session 2 Session 3 MARKETING MIX Communications, Product, Channels, Price

Session 1 Session 2

SEGMENTATION MARKET SEGMENTATION Session 1

CUSTOMER-CENTRIC

MARKETING MANAGEMENT PROCESS

(HU,2011)

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Agenda

Product
How do we understand product in marketing? Challenges in new product development Building strong brand

Distribution Pricing Brief Revision

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What is a Product?
Product Customers dont buy products Buy a set of benefits

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Failure to Create Right Benefits for Consumers: Examples of New Product Blunders
Failure occurs frequently

40%-45% of new product development projects introduced to the

market fail

Only 6.6 new product ideas lead to 1 success

Why have the following new products failed?

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Failure to Create Right Benefits for Consumers: Examples of New Product Blunders
Main Factors that lead to New Products Failure
Inadequate Market Analysis Product Problems or Defects Lack of Effective Marketing Efforts Higher Cost than Expected Competitive Strength or Action Poor Timing of Introduction Technical or Production Problems All Other Causes 0%
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Ostrich

24% 16% 14% 10% 9% 8% 6% 13% 5% 10% 15% 20% 25% 30% Dinosaurs Flamingo

*PDMA Best Practices Survey

Levels of Meaning for a Product

Augmented offer

10 year Warranty

Sound system

Car: a transportation device

Expected offer

Generic or core offer

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Building A Strong Brand for Your Product

A. Brand Elements
Brand names Characters

URLs

Memorability Meaningfulness Appeal Transferability Adaptability Protectability

Logos & Symbols

Jingles Packaging
Pepsi in Taiwan Schweppes Tonic Water in Italy Chevy Nova Vicks in Germany

Slogans

The Ultimate Driving Machine

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Building A Strong Brand for Your Product

B. Supporting Marketing Programmes

Global Advertising:e.g., Worth Waiting For Sponsorship Website WWW.Guinness.Com Guinness Storehouse

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What is Marketing Channel?

A set of interdependent organizations involved in the process of making a product or service available for use or consumption Strategic alternatives 1. Direct distribution/direct marketing 2. Use of intermediaries 3. A combination of 1. and 2.

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Pricing

Pricing Effective Pricing Allows Firm To Capture Value

The 3 Cs impact pricing

Companys cost Customers sense of products value Competitions price
Coca-Cola Fuji Photo Nestle Ford Philips Typical U.S. Co. 6.4% 16.7% 17.5% 26.0% 28.7% 12.0%

Estimates of the impact of a 1% price increase on profits, assuming volume remains the same

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Key Takeaways
The important concept of product Levels of meaning New product development challenges How to build strong brands Place Alternatives Decisions Pricing 3 Cs Revision Marketing management process
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Additional Readings
Relevant chapters (product, distribution and pricing) in Marketing : an introduction / Gary Armstrong, Philip Kotler Or Marketing management [electronic resource] / Philip Kotler ... [et al.].

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