Transcript NPD and Sales.ppt

BA 590
New Product
Development and
Sales
Defining “Product”
Target Market
Product
Place
Promotion
Price
Product
Idea
Brand
Package
Warranty
Physical
good/service
Features
Quality level
Accessories
Installation
Instructions
Product line
Type of Brand:
Individual or
family
Manufacturer or
dealer
Protection,
Promotion,
or both
None, full, or
limited
Exhibit 8-1
8-3
The Adoption Curve
Innovators
(3-5%)
Percent Adoption
90
Early
Adopters
(10-15%)
Early
Majority
(34%)
50
20
5
0
Exhibit 13-7
13-14
Time
Late
Majority
(34%)
Laggards/
Nonadopters
(5-16%)
The Adoption Curve
• Innovators:
• First to Adopt, Eager to Try
• Young, Well-Educated, Mobile
• Seek Info from non-salesperson Sources
• Early Adopters
• Opinion Leaders
• Greater Contact with Salespeople
• Word-of-Mouth
The Adoption Curve
• Early Majority:
• Avoid Risk, Try Only if Others Have
Usually are Not Opinion Leaders
• Late Majority:
• Cautious About New Ideas, Older
and More Set in Their Ways
• More Subject to Peer Pressure
The Adoption Curve
• Laggards:
• Suspicious of New Ideas
• Do Things the Way that They Have
Always Been Done
The Product Life Cycle
Market
Introduction
Market
Growth
Market
Maturity
Sales
Decline
Total Industry
Sales
+
Total Industry
Profit
$0
Time
–
Exhibit 9-1
9-3
Defining Product
• High Physical Good Emphasis
• Nails, Soup
• Medium Physical Good
Emphasis/Medium Service Emphasis:
• Restaurant Meal, Automobile Tune-up
• High Service Emphasis:
• Financial Services, Hair Cut, Postal
Service
Consumer Product Classes
Convenience
Consumer
Product
Classes
Shopping
Specialty
Unsought
8-4
Product Lines
• Product Assortment: All Products
and Product Lines in a Firm
• Product Lines: Individual Products
that are Closely Related
• Individual Products: Particular
Products in a Product Line
Oakley Product Assortment
Oakley Product Line
Individual Product
3-Minute Drill
• Identify a New “Individual
Product” or “Individual Service”
that is Part of an Existing Product
Line. Explain Why it Would be
Successful
• Example: Kodak has a Product Line of
Disposable Cameras. A Possible New
“Individual Product” Would be a Disposable
Digital Camera.
1-5
The Product Life Cycle
Market
Introduction
Market
Growth
Market
Maturity
Sales
Decline
Total Industry
Sales
+
Total Industry
Profit
$0
Time
–
Exhibit 9-1
9-3
Planning for Life Cycle Stages
Introducing New
Products
Focus:
Managing Mature
Products
Focus:
Budget / Rate of Growth
Persuasion / Less Profit
Focus:
Future Adaptation
New Markets
Dying Products
9-4
New or Improve?
Focus:
New Strategies
Focus:
Phase Out
New-Product Development Process
Idea
Generation
Ideas from:
Customers
and users
Marketing
research
Competitors
Other
markets
Company
people
Middlemen
Exhibit 9-4
9-5
Screening
Idea
Evaluation
Strengths
and
Weaknesses
Fit with
objectives
Market
trends
Rough ROI
estimate
Concept
testing
Customer
reactions
Rough
estimates
of cost,
sales,
profits
Development
R&D
Develop
model or
service
prototype
Test
marketing
mix
Revise plans
as needed
ROI estimate
Commercial
-ization
Finalize
product and
marketing
plan
Start
production
and
marketing
“Roll out” in
select
markets
Final ROI
estimate
Types of New Product Opportunities
Immediate Satisfaction
High
High
Long-Run
Consumer
Welfare
Low
Exhibit 9-5
9-6
Low
Desirable
Products
Salutary
Products
Pleasing
Products
Deficient
Products
New-Product Development Management
Top Level
Support
Key
Issues
Authority
Market-Guided
R&D
9-7
Total Quality Management
Cost of Defects
Management
Leadership and
return on quality
Continuous
Improvement
TQM
Customer
Focus
Empowerment
Quality tools,
benchmarking,
and the like
9-8
NPD At Briggs and Stratton
• Are There Any Advantages to
Holding Off International
Distribution of the Quattro Engine?
• What Does Maturity in the Mower
Market mean for B & S?
• Should B & S Develop Their own
Line of Lawn Mowers?
Promotion
• Sales Promotion
• Personal Selling
1-5
Basic Promotion Methods
Target
Market
Product
Place
Personal
Selling
Promotion
Mass
Selling
Advertising
Exhibit 13-1
13-3
Sales
Promotion
Publicity
Price
Sales Promotion Activities
Aimed at final
consumers or users
Contests
Coupons
Aisle displays
Samples
Trade shows
Point-of-purchase
materials
Banners and
streamers
Trading stamps
Sponsored events
Exhibit 13-2
13-4
Aimed at middlemen
Price deals
Promotion allowances
Sales contests
Calendars
Gifts
Trade Shows
Meetings
Catalogs
Merchandising aids
Aimed at company’s
own sales force
Contests
Bonuses
Meetings
Portfolios
Displays
Sales aids
Training materials
Promotion and the Demand Curve
Price
Price
Price
D
D1
D
D2
0
Quantity
A. To be more elastic
13-8
D
D
0
Quantity
B. to the right
0
Quantity
C. Both to the right
and more elastic
The Traditional Communication Model
Source
Encoding
Message
channel
Noise
Feedback
Exhibit 13-4
13-10
Decoding
Receiver
Message Interpretation
Encoder
The same
message may be
interpreted
differently by the
encoder and the
decoder
Common
frame of
reference
Decoder
13-11
Push-Pull Strategies
Producer’s Promotion Blend
Exhibit 13-6
13-13
Wholesaler
Promotion
Push
Promotion to
Channel Members
Wholesaler
Promotion
Push
Retailer
Promotion
Push
Business
Customer
Pull
Final
Consumer
Pull
Promotion to
Final Customers
Promotion to
Business Customers
Personal Selling, Sales Promotion, Advertising, Publicity
Setting the Promotion Budget
Percentage of Sales?
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Match Competitors?
Per Unit?
Uncommitted Resources?
Task Method!
13-15
Strategy Planning for Personal Selling
Target Market
Product
Place
Personal
Selling
Number and
kind of
salespersons
needed
Exhibit 14-1
14-3
Selection and
training
procedure
Promotion
Mass
Selling
Price
Sales
Promotion
Compensation
and motivation
approach
Personal
selling
techniques
Basic Sales Tasks
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14-4
Order-Getting
Order-Taking
Supporting
Basic Sales Tasks
• Order Getting
• Establishing Relationships with New
Customers and New Businesses
• Order Taking
• Sell to Regular or Established Customers,
Complete Most Transactions, Maintain
Relationships
• Supporting
• Missionary and Technical Specialists
Basic Sales Tasks
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14-4
Order-Getting
Order-Taking
Supporting
Types of Sales Presentations
• Prepared Sales Presentation
• Memorized Presentation for All
• Useful for Quick Training, Lower Skill
Levels
• Consultative Selling Approach
• Understanding the Customer’s Needs
Before Attempting to Close
• Acts as a Consultant to Identify and
Solve the Customer’s Problems
Types of Sales Presentations
• Buying Formula Approach
• Starts With Prepared Presentation
Approach
• Leads Customer Through Logical Steps
• Final Close
Steps in the Personal Selling Process
Prospect for
new customer
Set effort
priorities
Evaluate needs of
established customers
Preplan sales call and presentation(s)
Make sales presentation
Close sale
Follow up to
establish
Exhibit 14-3
14-8
Follow up to
maintain
Feedback
Select target customer
Questions
• What Strategy Decisions are Needed in
the Personal Selling Area? Why
Should the Marketing Manager Be
Involved?
Salesforce Structure
Major Accounts
Telemarketing
Sales Territory
Sales Force Size
14-5
Focus:
Large Customers
Focus:
Quick, Inexpensive
Focus:
Geographic Area
Focus :
Work Load
Selecting, Training, and Motivating
Job
Description
Key
Components
Training
Level of
Compensation
Method of
Payment
14-7
Compensating and Motivating
• Two Basic Decisions
• Level of Compensation
• Method of Compensation
• Method Of Compensation
• Straight Salary
• Straight Commission
• Combination Plan
Types of Presentation Approaches
Prepared
Approach
Three
Presentation
Approaches
Selling Formula
Approach
14-9
Consultative
Selling Approach
Types of Sales Presentations
• Prepared Sales Presentation
• Memorized Presentation for All
• Useful for Quick Training, Lower Skill
Levels
• Consultative Selling Approach
• Understanding the Customer’s Needs
Before Attempting to Close
• Acts as a Consultant to Identify and
Solve the Customer’s Problems
Types of Sales Presentations
• Buying Formula Approach
• Starts With Prepared Presentation
Approach
• Leads Customer Through Logical Steps
• Final Close
Branding
Rejection
Focus:
Change Position
Focus:
Nonrecognition
Increase Awareness
Focus:
Recognition
Preference
Insistence
8-6
Continue Education
Focus :
Maintain Availability
Focus : Develop High
Brand Equity
What Kind of Brand to Use?
?
Family
Brand
?
?
?
Individual
Brand
Branding
Choices
?
Manufacturer
Dealer
?
?
Generic
8-7
The Strategic Importance of Packaging
Convenient packages
are easier to use,
making purchase
decisions easier for
the customer as well.
8-8
Using Warranties to Improve the
Marketing Mix
A warranty says the
company stands behind
the product. Consumers
often feel more
comfortable with
products they know
come with assurances.
8-9