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The document discusses product and brand strategies over the life cycle of an industry. It covers the four stages of an industry life cycle: introduction, growth, maturity, and decline. For each stage, the document outlines the characteristics, strategies, functional areas of concern, and overall objectives for companies. It also discusses topics such as the three elements of a product, product mix, branding, brand equity, brand management, and strategies for developing, maintaining, and removing brands.
The document discusses product and brand strategies over the life cycle of an industry. It covers the four stages of an industry life cycle: introduction, growth, maturity, and decline. For each stage, the document outlines the characteristics, strategies, functional areas of concern, and overall objectives for companies. It also discusses topics such as the three elements of a product, product mix, branding, brand equity, brand management, and strategies for developing, maintaining, and removing brands.
The document discusses product and brand strategies over the life cycle of an industry. It covers the four stages of an industry life cycle: introduction, growth, maturity, and decline. For each stage, the document outlines the characteristics, strategies, functional areas of concern, and overall objectives for companies. It also discusses topics such as the three elements of a product, product mix, branding, brand equity, brand management, and strategies for developing, maintaining, and removing brands.
Dr. R.VENKATESH ALLIANCE UNIVERSITY MMBA Three basic elements of the product product attributes product benefits marketing support services
Characteristics of PLC and the implications for strategy PLC and product policy Product mix and product line Product as a strategic variable Life cycle of an industry o Introduction o Growth o Maturity o Decline Emphasis on strategies, functional areas, value- creating activities, and overall objectives varies over the course of an industry life cycle Adapted from Exhibit 5.8 Stages of the Industry Life Cycle Generic strategies Differentiation Differentiation Differentiation Overall cost Overall cost leadership leadership Focus Market growth rate Low Very large Low to Negative moderate Number of segments Very few Some Many Few Intensity of competition Low Increasing Very intense Changing Emphasis on product design Very high High Low to Low moderate Stage Introduction Growth Maturity Decline Factor Emphasis on process design Low Low to High Low moderate Major functional area(s) of concern Research and Sales and Production General Development marketing management and finance Overall objective Increase Create Defend Consolidate, market share consumer market share maintain, awareness demand and extend harvest, or product life exit cycles Stage Factor Introduction Growth Maturity Decline Products are unfamiliar to consumers Market segments not well defined Product features not clearly specified Competition tends to be limited Strategies Develop product and get users to try it Generate exposure so product becomes standard Characterized by strong increases in sales Attractive to potential competitors Primary key to success is to build consumer preferences for specific brands Strategies Brand recognition Differentiated products Financial resources to support value-chain activities Aggregate industry demand slows Market becomes saturated, few new adopters Direct competition becomes predominant Marginal competitors begin to exit Strategies Efficient manufacturing operations and process engineering Low costs (customers become price sensitive) Industry sales and profits begin to fall Strategic options become dependent on the actions of rivals Strategies Maintaining Exiting the market Harvesting Consolidation Asset and cost surgery Selective product and market pruning Piecemeal productivity improvements Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 3 A Brand is a .. A Brand is a .. Name, Term, Sign, Symbol, or Design . intended to distinguish the goods and services from one another Brand equity: The goodwill (equity) that an established brand has built up over its existence. DREK -- differentiation, relevance (strength) -- esteem, knowledge (stature) Brand concept: specific meaning that brand managers create and communicate to the target market. Brand concept management: the analysis, planning, implementation, and control of a brand concept throughout the life of the brand. Brand naming criteria Commonly used research approaches to determine brand meaning: o Word associations o Personifying the brand o Laddering up the brand essence Brand essence Laddering up o Brand bonding (through experience) o Brand building tools Public relations and press releases Sponsorships Clubs and consumer communities Factory visits Trade shows Event marketing Public facilities Social cause marketing High value for the money Founders or a celebrity personality Mobile phone marketing
Nikes arrangement with Michael Jordan has provided an excellent example of a celebrity endorsement. Can you think of an endorsement campaign that backfired? What did it cost the company in the short term? What, if any, have been the lasting effects? Advantages of Branding Consumers viewpoint 1. Product quality 2. Increased shopper efficiency 3. Calls attention to new products 4. Reduces psychological risk Sellers viewpoint 1. Handling orders, tracking down problems 2. Trademark legal protection 3. Brand loyalty 4. Reduces need for in-store contact 5. Facilitates segmentation, promotion, and pricing
Branding Challenges o Branding Decision: To Brand or Not to Brand? Branding Decisions Issues in the battle of the brands: (1) how prices are set? (2) turnover, and (3) gross margin. Manufacturer brands: (1) prices are set to maximize profit for the brand and are influenced by competitive forces, (2) they have a higher turnover than distributor brands. (Why??) Distributor brands: (1) prices are set to maximize profit for the store and (2) they have a higher gross margin than manufacturer brands. (Why??)
Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 31 Adding An Item: Four Brand Adding An Item: Four Brand Types Types Product Category Existing New Existing Line Extension Brand Extension Brand Name New Flanker Brand New Product Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 49 Strategies for Brand Revival Strategies for Brand Revival Underlying cause? Reformulate the product/package Move the product into new foreign or domestic markets Discover and promote new uses for the product New promotion campaign/agency Cost reduction Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 50 Options for dropping Options for dropping products products Revive if justified in believing brand can be saved Drop promotional activities (reducing costs) and rely on repeat purchases (which will be more profitable as they continue) Contract or license to another company for manufacturing Sell off/dispose of brand Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 51 Selling/ Removing a Product Selling/ Removing a Product Involves Involves Minimizing inconvenience to customers and channel partners Notify dealers in advance Help dealers clear out old stock Offer dealer discounts on discontinued brands Buy back unsold merchandise Information on replacement brands should be easily available Arrange to provide service and parts for recent buyers (customer goodwill) They cant stand out in the marketplace and they are struggling to connect with people. Here are six reasons why. Michael Eisner of Disney has called the word brand over-used, sterile, and unimaginative. Hes right. As the brand manual grows heavier and more detailed you know youre in trouble. Making sure the flowers in reception conform to the brand guidelines just shows you are looking in the wrong direction. Consumers are who you should be paying attention to. What matters to them. Otherwise, youre hiding, and youre in trouble. There is a new anti-brand sensibility. There is much more consumer awareness, more consumers who understand how brands work and, more importantly, how they are intended to work on them! For most brands there is nowhere left to hide. The information age means that brands are part of the public domain. Hidden agendas, subliminal messages, tricky moves forget it. For most brands it is a new age of consumer savvy. The new consumer is better informed, more critical, less loyal, and harder to read. The white suburban housewife who for decades seemed to buy all the soap powder no longer exists. She has been joined by a new population of multi-generational, multi-ethnic, multi-national consumers The more brands we invent the less we notice them as individuals. If youre not Number One or Two, you might as well forget it. And the greater the number of brands, the thinner the resources promoting them. You get a treadmill of novelty, production value, incremental change, tactical promotions, and events The definitions, charts, diagrams, and tables. There are too many people following the same rule book. When everybody tries to beat differentiation in the same way nobody gets anywhere. Formulae cant deal with human emotion. Formulae have no imagination or empathy The story of brands has gone from daring and inspiration to caution and aversion to risk. Once the darling of the bold and the brave, brands are relying on the accumulation of past experiences rather than the potential of future ones. The Lovemarks of this new century will be the brands and businesses that create genuine emotional connections with the communities and networks they live in. This means getting up close and personal. And no one is going to let you get close enough to touch them unless they respect what you do and who you are. Love needs Respect right from the start. Without it, Love will not last. It will fade like all passions and infatuations. Respect is what you need when you are in for the long haul. Respect is one of the founding principles of Lovemarks Lovemarks are the future beyond brands. Lovemarks inspire loyalty beyond reason. Lovemarks are built on Love and Respect. Lovemarks are owned by the people who love them - consumers not companies. Lovemarks can be everything that people care deeply about
Lovemarks read ROI as Return on Involvement. Lovemarks are more than irreplaceable. They are Irresistible Kung Fu guys are Irreplaceable. Bruce Lee is Irresistible - 32 years on from his death. The classic T-shirt is Irreplaceable. Local or global. you recognize Lovemarks instantly.
IDEA #1 DRIP WITH EMOTION Differentiation is beyond reason , beyond efficiency, benefit, performance, functionality. Table stakes all!! Fact : Emotion, intuition, long-term memories and unconscious motivations control as much as 85% of our decision-making process.
Consumers are saying: Youve got three seconds to change my life or you are gone. From Information Economy, Knowledge Economy, Interruption Marketing (aka the Mass Market), Permission Marketing, the Experience Economy, the Attention Economy to the ATTRACTION ECONOMY.
Low Respect. Low Love . Commodities, utilities, raw material. No names with no claims. The world of discounts, price wars, crushing competition. High Love. Low Respect . Hero today zero tomorrow. Fads and infatuations, promotions and competitions. Reality shows , J Lo jeans, Paris Hilton, the President of the US. High Respect. Low love . Brand to bland. Where those er words leach you dead: faster, bigger, brighter, cheaper. High Love and High Respect . Lovemarks. Enchanting innovation. Irresistible appeal.
Mystery The beguiling power of the unknown. Metaphors and dreams, symbols and stories. The flow of past, present and future. When we know everything, there is nothing left to delight us. Sensuality - Sight, sound, smell, touch and taste are portals to the emotions. never pay a premium for anything that doesn't excite most of your senses. Intimacy is knowing the consumer better than she knows herself. The energy field is sight, sound and motion. Saatchi & Saatchi invented sisomo for the Screen Age, the everywhere world beyond TV. 89% of major brands are planning to market via mobile phones by 2008, and more than half of brands plan to spend between 5% and 25% of their marketing budget in the medium in the next five years. (Airwide Solutions)
sisomo brings technology, marketing and creativity together. This intersection is the future of advertising. sisomo is where art meets science. sisomo puts ideas and potent connections ahead of technology. sisomo brings screens to life in emotional and compelling ways. sisomo attracts consumers with engaging, compelling stories. The story is an ancient, mysterious, timeless art. Marketers are caught up in technology and methodology. An engaging story well told is priceless. sisomo inspires new formats, characters and ways for consumers to participate on screen. Multi-layered, multi-purpose stories that consumers can be absorbed by, play with, add to, recreate, and spread virally.
Boundaries are collapsing. Categories are blurring. Convergence and divergence are imploding. Entire new industries are emerging. The Screen Age is about being a creative connector. Creative Connectors across media, advertising, marketing, design, entertainment, games, phones, ringtones, activations, instore TV, sound logos, animation, sisomo packaging, you name it. Lovemarks is about Creative Connectors inspiring loyalty beyond reason across the family of screens. The key connect is the Inspirational Consumer, the ones who love your brand, get there first, tell your story and improve it for free. Inspire and connect them!! They turn brands into Lovemarks. Lovemarks is about lives taking over brands. Either / Or compromises. You stay static. .And / And explodes through to the next level of possibility. STARBUCKs: home and work. Coffee and music and movies APPLE: Business modelling ($1 a song) and networking (music companies) and branding (white buds and wires) TOYOTA : gas and electric. Short and long term. Competitive and Open. Cost reduction and innovation. Lovemarks build complex opposites together with equal passion so they enhance each other and take you to a place neither dreamed possible. The role of business is to make the world a better place for everyone. Its a powerful, provocative, inescapable statement. Its plain business sense you can be loathed, liked or loved.
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