PRODUCTPLANNINGANDSTRATEGYFORMULATION 159
Whilethisdiscussionimpliesthatserviceproductsaremarketeddifferentlythangoods
products,it isimportanttorememberthatallpr0ducts,whethertheyaregoods,services,
blankets,diapers,orplateglass,possesspeculiaritiesthatrequireadjustMentsinthemar-
ketingeffort.However,"pure"goodsproductsand"pure"serviceproducts(i.e.,thoseon
theextremeendsofthecontinuum)tendtoreflectcharacteristicsandresponsesfromcus-
tomersthatsuggcStoppositemarketingstrategies.Admittedly,offeringanexceptionfllprod-
uctattherightprice,throughthemostaccessiblechannels,promotedextensivelyand
accurately,sJ:ouldworkforanytypeofproduct.Thegoods/servicesclassificationprovides
thesameusefulinsightsprovidedbytheconsumer/industrialclassificationdiscussedearlier.
PRODUCTPLANNINGANDST RATEGYFORMULATION
Theultima~epurposeofthischapteris tointroducetheideathatproductsareplanned,and
thata wholeseriesofdecisionsgointothisplanningprocess-fromthemomenttheprod-
uctideaisfirstconceptualizedtothedayit is finallydeleted.Theparticularlabelplaced
onthecompany's~lanformarketingitsproductistheproductstrategy.It ispartofthe
marketingstrategyandshouldharmonizewithit.Likethemarketing"traiegy,it contains
threeimportantelements.(1)thedeterminationofproductobjectives,(2)thedevelopment
ofproductplansthatwillhelpreachproductobjectives, and(3)thedevelopmentofstrate-
giesappropriatefortheintroductionandmanagementofproducts.
TheDeterminationofProductObjectives
Therearea greatmanyobjectivesthatrelatetotheproductmanagementeffort. Rathertha.1.
attemptingtoprovidea completelist, a discussionofthemostcommonproductobjectives
willprovideanadequateillustration.^4
Itissafetoconcludethata universalobjectiveisgrowthinsalesasa resultofthe
introductionofa newproductortheimprovementofanexistingproduct.Certainly,there
is littleneedtoengageineitherproductactivityunlessthisobjectiveispresent.
Anobjectiverelatedtogrowthinsalesisfindingnewusesforestablishedproducts.
Sincethisprocessis generallyeasierthandevelopingnewproducts,thesearchfornewuses
ofolderproductsgoesonendlessly. Forexample,TexasInstrumentshasfoundnumerous
usesfortheirbasicproduct,thesemiconductor.
Usingexcesscapacityisanothercommonlystatedproductobjective. Thisobjective
ispromptedbytherapidturnovero~productsandtheresultingchangesinmarketshare.
Ofcourse,suchutilizationisa!waysa short-runconsideration.InthelongrJn,onlythose
productsthatC3:lgeneratea continuinglevelofprofitabilityshouldberetained,regardless
oftheproblemofexcesscapacity.
Maintainingorimprovingmarketsharemayalsobeanobjectivesharedbymanycom-
panies.Insuchcases,theemphasisofthefirmisontheircompetitivepositionratherUlan
attaininga targetlevelofprofits.Creatingproductdifferentiationis oftentheprimarystrat-
egyemployedtoreachthisobjective.
Developinga fulllineofproductsisanothertypicalobjective.A companywitha par-
tialproductlinemaywellconsidertheobjectiveofroundingoutitsproductofferings. Often,
thesalesforceprovidestheimpetusforthisobjectiveinthattheymayneeda morecom-
pleteproductlinetooffertheircustoJ11ers,ortheresellersthemselvesmayrequesta greater
assortment.
Expandinga product'sappealtonewmarketsegmentsis a commonobjective.John
Deereis attemptingtoincreaseitssmallshareoftheconsumerpowerproductsmarketby
