Product Strategy Zou Deqiang, Ph. D School of Management, Fudan University Aprl23,2008
1 Product Strategy Product Strategy Zou Deqiang, Ph.D. School of Management, Fudan University April 23, 2008
Chapter Questions What is a product? How to understand a product at attribute level? How to manage a product mix? What to do with product life cycle(PLC)? How to work on new product development (NPD) and innovation diffusion? What's the relevance of product and service to experience? O Copy rights reserved, Zou Deqiang
2 2 © Copy rights reserved, Zou Deqiang Chapter Questions • What is a product? • How to understand a product at attribute level? • How to manage a product mix? • What to do with product life cycle (PLC)? • How to work on new product development (NPD) and innovation diffusion? • What’s the relevance of product and service to experience?
Bottled in Fiji. Shipped to you. What Ecosystem is your Water from? Untouched by Man. Until you drink it. Drink to your health Fluoride Calcium Product Price Discount Magnesium Price t H bottles/case$47.50 US 545.00CASE 330mL-36 FIJI Water 500m-24s37 US $35.00 CASI 50 bottles/case What is artesian water FIJI Water bottles/case$37.50 US$35.00 CASE bottles/ case 50.00 Us$47.50 http://www.fiiwater.com/
3 http://www.fijiwater.com/
Case Study FII Water-The Taste of Paradise Product Promotion Brand name: FIJI Natural It's a brand experience! Artesian Water Name, packaging, label Product source: comes celebrity endorsers and from an underground places through which it is location in Fiji islands. sold contributes to "Taste Key benefits: ultra-clean of paradise” Imagery taste, no impurities or Ads evoke exotic origins pollutants tropical forest, volcanoes Brand image: "The Taste High price charged of paradise” supports premium appeal O Copy rights reserved, Zou Deqiang
4 4 © Copy rights reserved, Zou Deqiang Product • Brand name: FIJI Natural Artesian Water. • Product source: comes from an underground location in Fiji islands. • Key benefits: ultra-clean taste, no impurities or pollutants. • Brand image: “The Taste of Paradise” FIJI Water FIJI Water – “The Taste of Paradise The Taste of Paradise” Case Study Case Study Promotion • It’s a brand experience! • Name, packaging, label, celebrity endorsers and places through which it is sold contributes to “Taste of Paradise” imagery. • Ads evoke exotic origins: tropical forest, volcanoes. • High price charged supports premium appeal
What s a product? Anything that can be offered to a market for attention, acquisition use, or consumption and that might satisfy a want or need > Includes: physical objects, services, events, persons places, organizations, ideas, or some combination thereof People buy benefits rather than objects O Copy rights reserved, Zou Deqiang
5 5 © Copy rights reserved, Zou Deqiang What Is a Product? • Anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need ¾Includes: physical objects, services, events, persons, places, organizations, ideas, or some combination thereof • People buy benefits rather than objects
Levels of a Product Core benefit >What the consumer is really buying Actual product >Includes the brand name, features, design, packaging, quality level ° Augmented product Additional services and benefits such as delivery and credit, instructions, installation, warranty, service O Copy rights reserved, Zou Deqiang
6 6 © Copy rights reserved, Zou Deqiang Levels of a Product • Core benefit ¾What the consumer is really buying. • Actual product ¾Includes the brand name, features, design, packaging, quality level. • Augmented product ¾Additional services and benefits such as delivery and credit, instructions, installation, warranty, service
Three Levels of product Augmented product Delivery Actual product and ale credit/Brand Features servce name Core benefit level Packaging Installation Warranty China Merchant Bank Yu Run Food Virgin 7 O Copy rights reserved, Zou Deqiang
7 7 © Copy rights reserved, Zou Deqiang Three Levels of Product • China Merchant Bank • Yu Run Food • Virgin
Convenience Products Purchased frequently and immediately Low priced Mass advertising Many purchase locations EXamples: candy, soda, newspapers 8 O Copy rights reserved, Zou Deqiang
8 8 © Copy rights reserved, Zou Deqiang Convenience Products • Purchased frequently and immediately • Low priced • Mass advertising • Many purchase locations ¾Examples: candy, soda, newspapers
Shopping products Bought less frequently Higher price Fewer purchase locations Comparison shop > EXamples: furniture, clothing, cars, appliances 9 O Copy rights reserved, Zou Deqiang
9 9 © Copy rights reserved, Zou Deqiang Shopping Products • Bought less frequently • Higher price • Fewer purchase locations • Comparison shop ¾Examples: furniture, clothing, cars, appliances
Specialty Products Special purchase efforts High price Unique characteristics Brand identification Few purchase locations Example: Lamborghini, Rolex Watch O Copy rights reserved, Zou Deqiang
10 10 © Copy rights reserved, Zou Deqiang Specialty Products • Special purchase efforts • High price • Unique characteristics • Brand identification • Few purchase locations ¾Example: Lamborghini, Rolex Watch