role and operation of product in marketi

Role and Operation of Product in marketing : 

Role and Operation of Product in marketing Chandra Mohan

Product role : 

Product role Core of marketing : no product, no marketing Relevance of core benefit Addressing an unmet need Providing an augmented benefit

Key Success factors : 

Key Success factors Quality Packaging Distribution Messaging Media

Product marketing : 

Product marketing "4P"'s of marketing Product, Pricing, Place, and Promotion. Extended Marketing Mix People ,Process & Physical Evidence

Role of product in marketing : 

Role of product in marketing Product marketing in a business addresses five important strategic questions • What products will be offered (i.e., the breadth and depth of the product line)? • Who will be the target customers (i.e., the boundaries of the market segments to be served)? • How will the products reach those (i.e., the distribution channel)? • How much should the products be priced at? • How to introduce the products (i.e., the way to promote the products)?

Porter's 5-Forces Model : 

Porter's 5-Forces Model 1.Entry of competitors 2.Threat of Substitutes 3. Bargaining Power of buyers 4. Bargaining Power of suppliers 5. Rivalry among the existing players Government

Corporate Portfolio Perspective on Multibusiness companies : 

Corporate Portfolio Perspective on Multibusiness companies Boston Consulting Group (BCG) matrix: Identifying the Strategic Business Units (SBUs) by business area or product market Assessing each SBU’s prospects (using relative market share and industry growth rate) relative to other SBUs in the portfolio. Developing strategic objectives for each SBU McKinsey/GE matrix

The BCG Matrix : 

Rebecca J. Morris Chapter 6 8 The BCG Matrix High High Low Low Industry Growth Rate Relative Market Share 10% 1 0.1 10 0% 20%

The BCG Matrix : 

The BCG Matrix Source: Perspectives, No. 66, “The Product Portfolio.” Adapted by permission from The Boston Consulting Group, Inc., 1970.

Slide 10: 

The BCG Growth-Share Business Portfolio Matrix Circle Size = proportion of total revenue business contributes to corp.

The BCG Matrix : 

The BCG Matrix Stars High relative market shares in fast growing industries. Question marks Low relative market shares in fast growing industries. Cash cows High relative market shares in low-growth industries. Dogs Low relative market shares in low-growth industries.

The Strategic Implications of the BCG Matrix : 

The Strategic Implications of the BCG Matrix Stars Aggressive investments to support continued growth and consolidate competitive position of firms. Question marks Selective investments; divestiture for weak firms or those with uncertain prospects and lack of strategic fit. Cash cows Investments sufficient to maintain competitive position. Cash surpluses used in developing and nurturing stars and selected question mark firms. Dogs Divestiture, harvesting, or liquidation and industry exit.

Weaknesses of the BCG Matrix : 

Weaknesses of the BCG Matrix No average position Oversimplification Position in matrix ? investment success Cash cows defending shrinking market share 2 dimensions -- inadequate Cash flow emphasis

Constructing a GEAttractiveness/Strength Matrix : 

Constructing a GEAttractiveness/Strength Matrix Use quantitative measures of industry attractiveness and business strength to plot location of each business in matrix Each business unit appears as a circle Area of circle is proportional to size of business as a percent of company revenues (Or area of circle can represent relative size of industry with pie slice showing the company’s market share)

Procedure: Rating the Relative Attractiveness of Each Industry : 

Procedure: Rating the Relative Attractiveness of Each Industry Step 1: Select industry attractiveness factors Step 2: Assign weights to each factor (sum of weights = 1.0) Step 3: Rate each industry on each factor (use scale of 1 to 10) Step 4: Calculate weighted ratings; sum to get an overall industry attractiveness rating for each industry

Example: Rating Industry Attractiveness : 

Example: Rating Industry Attractiveness Rating Scale: 1 = Unattractive; 10 = Very attractive

Rating the Competitive Strength of Each Business : 

Rating the Competitive Strength of Each Business Step 1: Select competitive strength factors Step 2: Assign weights to each factor (sum of weights = 1.0) Step 3: Rate each business on eachfactor (use scale of 1 to 10) Step 4: Calculate weighted ratings; sum to get an overall attractiveness rating for each business

Example: Rating a Business Unit’s Competitive Strength : 

Example: Rating a Business Unit’s Competitive Strength Rating Scale: 1 = Weak ; 10 = Strong Bargaining leverage

General Electric’s Industry Attractiveness-Business Strength Matrix : 

General Electric’s Industry Attractiveness-Business Strength Matrix Low High Medium Average Strong Weak Market Size Growth Rate Profit Margin Intensity of Competition Seasonality Cyclicality Resource Requirements Social Impact Regulation Environment Opportunities & Threats Relative Market Share Reputation/ Image Bargaining Leverage Ability to Match Quality/Service Relative Costs Profit Margins Fit with KSFs Industry Attractiveness Business Strength Rating Scale: 1 = Weak ; 10 = Strong 6.7 3.3 10.0 1.0 1.0 3.3 6.7

The McKinsey/GE Matrix : 

The McKinsey/GE Matrix

Strategy Implications of Attractiveness/Strength Matrix : 

Strategy Implications of Attractiveness/Strength Matrix Businesses in upper left corner Accorded top investment priority Strategic prescription is grow and build Businesses in three diagonal cells Given medium investment priority Invest to maintain position Businesses in lower right corner Candidates for harvesting or divestiture May be candidates for an overhaul and reposition strategy

The Attractiveness/Strength Matrix : 

The Attractiveness/Strength Matrix Allows for intermediate rankings between high and low and between strong and weak Incorporates a wide variety of strategically relevant variables Stresses allocating corporate resources to businesses with greatest potential for Competitive advantage and Superior performance

Limitations on Portfolio Planning : 

Limitations on Portfolio Planning Flaws in portfolio planning: The BCG model is simplistic; considers only two competitive environment factors– relative market share and industry growth rate. High relative market share is no guarantee of a cost savings or competitive advantage. Low relative market share is not always an indicator of competitive failure or lack of profitability. Multifactor models such as McKinsey/GE matrix are better though imperfect.

The Corporation as a Portfolio of Core Competencies : 

The Corporation as a Portfolio of Core Competencies Establishing a Core Competence Agenda Source: G. Hamel and C. K. Prahalad, Competing for the Future (Cambridge, Mass.: Harvard Business School Press, 1994), p. 227.

Operations of product in Marketing : 

Operations of product in Marketing Procurement (Purchasing) Practices Management Control and Coordinating Function Product and Service Management Quality Management Inventory Management

General Resources About Inventory Control and Management : 

General Resources About Inventory Control and Management Software Packages Logistics and Transportation Management General Resources About Logistics and Transportation Facilities Management Configuration Management Distribution Channels