PRODUCT PLANNING AND MANAGEMENT

After reading this blog, you will be able to understand :

• Concept of Product

• Levels of Product

• Classification of Product

• Management of Product Line Extensions

Product Planning and Development

Product is anything that can be offered to a market to satisfy a want or need.

PRODUCT CONCEPT :

     

The Product Concept assumes that consumers will buy the product that offers them the highest quality, the best performance and the most features.

PRODUCT LEVEL :

The most fundamental level is the core benefit : the fundamental service or benefit that the customer is really buying. 

Example : A hotel guest is buying " rest and sleep ". The purchaser of a drill is buying " holes ".

At the second level, the marketer has to turn the core benefit into a basic product. Thus, a hotel room includes a bed, bathroom, towels, desks, etc.

At the third level, the marketer prepares an expected product, a set of attributes and conditions buyers normally expect when they purchase this product. Hotel guests expect a clean bed, fresh towels, working lamps and a relative degree of quiet. ( because most hotels can meet this minimum expectation, the traveler normally will settle for whichever hotel is convenient or least expensive )

At the fourth level, the marketer prepares an augmented ( increased amount / increased value / increased size / etc. ) product that exceeds customer expectations. 

Example : A hotel can include a remote control television set, fresh flowers, rapid check-in, express check-out and fine dining and room services.

Today's competition essentially takes place at the product augmentation level.

Some Important points should be noted about product augmentation level :

• First, each augmentation adds cost.

• Second, augmented benefits soon become expected benefits.

At the fifth level stands the potential product, which encompasses all the possible augmentations and transformations the product might undergo in future. Here is where companies search for new ways to satisfy customers and distinguish their offer.

Richard Branson of Virgin Atlantic is thinking of adding a casino and a shopping mall in the 600-passenger planes that his company will acquire in the next few years.

SUCCESSFUL COMPANIES ADD BENEFITS TO THEIR OFFERING THAT NOT ONLY SATISFY CUSTOMERS BUT ALSO SURPRISE AND DELIGHT THEM.

Note : This is a Sunday Special blog. The remaining part of this    " Product Planning and Management " will be published next Sunday. 

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