USING THE MARKETING MIX; PRODUCT
PRODUCT DEVELOPMENT: changing aspects of goods and services to meet the changing needs of existing customers or to target a different market this is important for a business as it can help the product adapt and still make profit.
PRODUCT MIX: THE FULL RANGE OF PRODUCTS OFFERED BY A BUSINESS, ALSO KNOWN AS A PRODUCT PORTFOLIO
PRODUCT LINE: A SET OF RELATED GOODS OR SERVICES
USP: unique selling point is how a business differentiates from other products through a certain function or the product itself
THE PRODUCT DEVELOPMENT PROCESS:
FACTORS WHICH INFLUENCE PRODUCT DEVELOPMENT:
1. Advances in technology; technology such as robotics and automated stock control may be beyond the budget of many small businesses, and this could lead to fears that such firms cannot compete against organisations able to achieve lower costs and improved product quality
2. Actions by competitors; competitors can threaten market share, and lead to the necessity of new product development. Smaller businesses cannot compete with larger businesses and their prices a solution to this may be to extend their product mix to appeal to a wider range of consumers.
3. The entrepreneurial skills of managers/owners; managers and owners, through their creative thinking and risk-taking , move products/brands in new directions
4. Financial situation; the finance available will determine how well and how much a business can develop their product.
PRODUCT LIFE CYCLE :
- The cycle illustrates the broad trends in sales revenue
- identifies points at which business may need to consider new products
The growth stage is the most favorable stage
extension strategies to avoid decline:
- finding new uses for the product
- finding new markets for existing products
-develop a wider product range
-changing appearance or packaging
THE BOSTON MATRIX
This model analyses the goods and services offered by a business in terms of their share of the market, and whether the market itself is growing.
Using this model a firm can quickly assess the position of all their products in their relative markets. From this assessment decisions can be made about how each product should be treated in the future.
THE QUESTION MARK (PROBLEM CHILD): - a new product with a small market share of a growing market
- high maintenance with high levels of investment needed
- high failure rate but potential for future success
- examples: apple macs.
THE RISING STAR:- high share of a growing market
- high maintenance
- fierce competition is likely
- examples ipad
THE CASH COW:- high share in a low growth market
- any increase will be at the expense of a competitor
- low maintenance; little expenditure needed, relatively high profits
- example iphone
THE DOG:- low share of a declining market; may be kept going because they complete a product line; can possibly be revived