Core Concepts of Marketing

PRODUCTPLANNINGANDSTRATEGYFORMULATION 165

theproductwillbereturnedbyonlya fewpeople.Extensiveresearchshouldsup-

portthisdecision.

4. Delivery,installation,training,andservice.Productsthattendtobephysically
   cumbersomeorlocatedfarfromthecustomer mightconsiderdelivery(freeora
   smallcharge)tobeanintegralpartofthenewproduct.Veryfewmajorappliance
   stores,lumberyards,orfurniturestorescouldsurvivewithoutprovisionsforthis
   service.Similarly,thereareproductsthatarequitecomplicatedand/orverytech-
   nical,andwhoseaverageconsumercouldneitherlearnhowtoinstal!oruseitwiLh-
   outassistancefromthemanufacturer.Bothprofessional andhomecomputer
   companieshavebeenforcedtoprovidesuchservices.Theslowdevelopmentof
   v;deoproductsorproducttypesthathavea historyofbreakdownandextensive
   maintenancerr..ustofferthisservicetothecustomer.Inaddition,it mustbepro-
   vic.edquicklyandeffectively.Althoughproductserviceandmaimenanceha:,been
   providedtoindustrialcustomersforseveralyears,this serviceisstiPnewtomany
   c:ustomerproductmanufacturers.

ProductMixStrategies Asmorebrandsenterthemarketplaceandlockintoa par-
ticularshareofthemarket,itbecomesmoredifficulttowinandholdbuyers.Ot'Jerchanges
thatoccurare:(1)changesinconsumertastesandinparticular, thesizeandcharacteris-
ticsofparticularmarketsegments, (2)changesinavailabilityorcostofrawmaterialsand
otherproductionormarketingcomponents;and(3)theproliferationofsmall-sharebrands
thatreduceefficienc:iesinproduction,marketing, andservicingforexistingbrands.Because
offactorssucha~these. a decisionismadeeithertoidentifywaysofchangingtheprod-
ucttofurtherdistinguishit fromotners,ortodesigna strategymatwilleliminatetheprod-
uctandmakewayfornewproducts.Thespecifics,rategytoaccomplishtheseaimsmay
beinseveralgeneralcategor'es.
Productmodification:Itisnormalfora producttobechangedseveraltimesduring
itslife.Certainly,a productshouldbeequalorsuperiortothoseofprincipalcompetitors

Ifa changecanprovidesuperiorsatisfactionandwinmoreinitialbuyersandswitchersfrom

otherbrands,thena changeis probablywarranted.

'letthedecisionshouldnotbeapproachedina haphazardmanner.Therearedefinite

risks.Parexample,a dramaticincreaseinproductqualitymightpricetheexistingtarget

consumeroutofthemarket,orit mightcausehim/hertoperceivetheproductasbeingtoo

good. Similarly, theremovalofa particular?roductfeaturemightbetheonecharacteris-

ticoftheproductconsidered mostimportantbya marketsegment.Akeyquestionthemar-

ketermustanswerbeforemodifyingtheproductiswhatparticularattributesoftheproduct

andcompetingproductsareperceivedasmostimportantbytheconsumer.Factorssuchas

quality,fu'1ctions,price,services,design,packaging,andwarrantymayallbedeterm:nants.

Thisevaluativeprocessrequirestheproductmanagertoarrangeformarketingresearch

studiestolearnofimprovementsbuyersmightwant,evaluatethemarketreceptiongiven

tothecompetitors'improvements,andevaluateimprovementsthathavebeendeveloped

withinthecompany.Alsorequiredisa relationshipwiththeproductresearchanddevel-

opment(R&D)department.Ideally,R&Dshouldbeabletorespondquicklytothemar-

ketingdepartment'srequestforproductupgradingandshouldmaintainongoingprograms

ofproductimprovementandcostreduction.Evensuppliersanddistributorsshouldbeenco~'r­

agedtosubmitsugge:.tions.

Productpositioningisastrategicmanagementdecisionthatdeterminestheplacea

productshouldoccupyina givenmarket-itsmarketniche.Giventhiscontext,theword

"positioning"includessevemlofthecommonmeaningsofposition:a place(whatplace