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What is a Product?
A Product is anything that can be offered to a market for attention, acquisition, use, or
consumption and that might satisfy a want or need. (Product: a need-satisfying
offering of a firm.)
Includes:
Physical Objects
Services
Events
Persons
Places
Organizations
Ideas
Combinations of the above
Consumer-Goods Classification
By introducing a limited product line into foreign markets the firm can test the
market before taking a bigger plunge.
European Consumer Preferences Regarding Private Labels
European Households Judging Credibility of Private Labels
Product Packaging and Labeling
Why Package Crucial as a Marketing Tool
Self-service
Consumer affluence
Company & brand image
Opportunity for innovation
Labels
NEW PRODUCT DEVELOPMENT
Developing New Global Products
Five Stages of the New Product Development Process
Idea Generation
Local subsidiaries are likely to have some ideas from their respective markets
and new technology is a common source of new product ideas
Preliminary Screening
The most immediate evaluation of an idea is whether it is compatible with the
company objectives, strategies, and resources.
Concept Research
Focus Groups offer the development team a chance to hear spontaneous
reactions to a new concept and hear suggestions for improvement.
Alternative Strategies
The Testing of New Product Concepts
Testing for performance and customer acceptance is the final stage of product
development.
Testing ranges from reliability tests to mini-launches
Reasons that new international products fail
Relying on instinct or hunch rather than testing and research
Lack of product distinctiveness
Unexpected technical problems
Mismatch between functions
International Product Testing Techniques
Limited product launch in one country market.
Laboratory test markets to capture consumer reactions in a controlled environment.
Microtest marketing uses a permanent panel of consumers and assesses their
willingness to buy after exposure to media and purchase incentives.
Forced distribution tests rely on the continuous report of consumer reactions to new
products already in the market
The Global Product Launch
Introducing the product into countries in
three or more regions within a narrow timeframe.
Managing the Brand Portfolio
A strong brand is a global marketing asset.
Cobranding
A strategic alliance where two or more brands are combined in an offer.
Brand strategy decisions
Use of the corporate name
Family brands for a wide product line
Individual brands for each item in the product line
Private (store) branding
Umbrella branding with the intermediary’s name
Separate brand names
Timing of Product Introductions in
Foreign Markets
Waterfall Strategy
product is introduced into foreign markets one at a time (IPLC model approach)
Useful when:
lifecycle of product is long
high fixed costs of entry into individual markets
foreign markets are not equally developed
some customization is needed
firms have little foreign experience
Sprinkler Strategy
simultaneous introduction of the product in multiple markets
Useful when:
short product life cycle
high R&D costs in product development
competition is very strong (pre-emption of markets)
firms have existing presence in target countries
homogenized preferences
Grey Marketing
Grey (or parallel marketing)
Products are imported outside of the established distribution channel – undercutting
the authorized channel pricing
Usually results from high imported prices
Question