INTRODUCINGAND MANAGING
THE PRODUCT
LEARNINGOBJECTIVES
Afterreadingthischapter,you shou,d beableto:- Lookatthe meaningoftheterm"product" fromthreedifferent
perspectives:the manufacturer,theconsumer,andthepublic. - Understandthethreelevelsinherentinall products.
- Learntheclassificationsystemsthatareusedto identifyprod-
ucts,andsuggestappropriatemarketingstrategies. - Clarifythedifferencebetween goodsproductsandservice
products. - Studysomeofthe processesinvolvedin productpianningand
strategyformulation:determination ofproductobjectivesand
identificationandresolution offactorsthathaveanimpactonthe
product. - Understandthe eightstepsthatmake-upthenewproductdevel-
opmentsystem.
JAPANESECARSONTHE DECLINE
J apan'sautodealershavetriedjustabouteverythingtorevivesales.OneToyota
MotorCorp.dealershipinTokyothrowsmonthlyfestivalsinitsparkinglotandoffers
discountsofasmuchas$2,500onnewmodels.ButpotentialcustomerssuchasKai
Matsuda,a smartlydressed 28 yearold,isn'tbuying.Sure,afterspendinga recentSun-
daytouringToyota'sswankfour-storyAmluxshowroominTokyo,Matsudacameaway
impressed.Thebuildinghousedeverythingfromruggedrecreationalvehiclestosleek
luxurysedanssuchasthe$37,000Aristo.Matsudawouldlovetobuya newcar,"ifI
hadthemoney."But,withJapan'seconomyontheskids,hedoesn't.
ForJapanesecarmakerspreparingtorollouttheirnewfleetsattheTokyoMotor
Show,consumerssuchasMatsudaillustratewhy 2000 wassucha toughyear. Despitea
flurryofnewlaunches,therecentincreaseinJapan'sconsumptiontaxfrom3%to5%
hascausedcarsalestodeclineforsixmonthsinarow.Dealerssold9%fewercarsin
Septembertheninthesamemontha yearearlierandseveralhavenowfallenintothered
orhavegonebankrupt.
Socarmakersaredesperatelyhopingtheir 2000 mOdelswillboostsales.The
MotorShow'snewlineshavethelatestinbreaking,engine,andtransmissiontechnology,151