Lecture 1

FACULTY NAME:
Assistant Prof. Sakhhi Chhabra
The mosT valuable brands of 2017.
Some brands survive for centuries
some brands fail
 1. The product falls short of claims and gets bashed. E.g
Windows vista, Samsung galaxy 7
2. The company cant support fast growth
3. The new item exists in product limbo. Coca-Cola C2
4. The product defines a new category and requires
substantial consumer educationbut doesnt get it.
Floss market in India
5. The product is revolutionary, but theres no market for
it
Source: Why Most Product Launches Fail
HBR https://hbr.org/2011/04/why-most-product-launches-fail
 India now has some 4,750 tech startups, 90% Of Startups Fail?
India saw 1,500 brand launches in the past 18 months, which
work out to three a day, but only 5% survive
Its hard to get something new on the radar, as families
repeatedly buy the same 150 items, which constitute as much as
85% of their household needs
while FMCG saw mostly line extensions, it was categories such
as telecom and auto that saw genuine new product launches in
the past years
http://www.business-standard.com
 Reason #1: Not really in touch with customers through
deep dialogue.
Reason #2: No real differentiation in the market (lack of
unique value propositions)
Reason #3: Failure to communicate value propositions in
clear, concise and compelling fashion.
Reason #4: Leadership breakdown at the top.
Reason #5: Inability to nail a profitable business model
with proven revenue streams.
 Business isnt sufficiently market focused and customer driven
Doesnt understand its target customers
Doesnt define and monitor its competitors
Mismanage its relationships with stakeholders
Isnt good at finding new opportunities
Has a deficient marketing planning process
Needs to improve product and service policies
Makes weak brand-building and communication efforts
Isnt well organized to carry out effective and efficient marketing
Has not made maximum use of technology
 Increasing price competition
Increasing importance of
customer service
Improving product quality
New market segments /
sectors
Power of the distribution
chains
High rate of innovation
Increasing customer demands
Environmental concerns
Government involvement
Increased promotional costs
Improve product/service
quality
Develop new products
Improve customer service
Competitor analysis
Price competition
Develop new segments
Brand/image differentiation
Improve distribution channels
More effective promotion
 2-3 Product Planning and Entry into Market
4-5 Challenges in developing new Products c Propecia
6-7 Developing product strategy c Tivo
8-9 Product portfolio decision c Mountain Man
10-11 Developing Strong brands
12-13 Identifying and Establishing Brand positioning
14-15 Communicate Brand offering
16-17 Measuring and interpreting Brand performance c
18-19 Growing and sustaining Brand equity overtime
20-21 Translating Brand into customer experience
22-23 Project Presentations
24 Final Discussions
 Class participation (activities + quizzes) 25%
* The quizzes would be unannounced and would be
administered to check on the level of preparedness of the
case study and level of learning of the participants.
End Term Exam 60%
Group Project* 15%
What's the difference ?
It is understood as the promise a product or service makes to
meet customers functional and emotional needs such that
it is highly significant to them, differentiates the product or
service from competitors, and is credible and consistent.
 The brand has advantages for consumers, for the manufacturer and for
intermediaries:
It allows consumers to distinguish the product from its competitors
It transmits information about the product
It gives greater consistency to the product's quality image
It enables the introduction of new products
Launching extension is easy
It serves as a vehicle for communications, efficiency in marketing programmes
It encourages loyalty
It reduces and simplifies the effort involved in searching for information
It facilitates the decision-making and buying process
It reduces the risk associated with the purchase- usage satisfaction
Leverage in distribution channels
Makes growth easier, u can charge premium

Aaker, D. A. (1996). Building Strong Brands. New York: The free press.
 SOIL
Consumers have a tremendous amount of choices available in
nearly every product and service category but have less and less
time to shop and make selections.
Well-known and trusted brand names are a touchstone for
consumers and help simplify their decision-making process. A
brand is a promise to the customer.
Branding guru Larry Light notes that Consumers dont go
shopping for a 24-valve, 6-cylinder, 200-horsepower, fuel-injected
engine. They shop for a Taurus, a Lexus, a BMW, a Jeep Cherokee,
a Hummer, whatever. They shop for well-known, trusted brands.
Lecture 2-5
FACULTY NAME:
Assistant Prof. Sakhhi Chhabra
 The traditional hierarchy
Flatter organizations
Flat organizations
Flatarchies
Holacratic organizations

https://www.forbes.com/sites/jacobmorgan/2015/07/08/the-5-types-of-organizational-structures-part-2-
flatter-organizations/#3f66cfb76dac
 Product management is an organizational lifecycle function within a company
dealing with the planning, forecasting, and production, and marketing of
a product or products at all stages of the product lifecycle.
Objective:
maximise revenues, market share and profit margins

Aspects of PM
Product planning:
defining new products, gathering marketing requirements, building product road
maps, PLC considerations, product differentiation
Product marketing:
identifying, anticipating and satisfying customer needs effectively and profitably.
Includes marketing research, pricing, promotion and brand image, etc.
 Product initiation stage
Feasibility
Development
Testing
Product launch
Operation phase
Decommissioning phase
Deprovisioning
Product upgrade
 What is the need for classification of new products?
Classify new products:
Some goods may be considered need goods by some buyers and specialty goods by
other buyers. The key is to understand your target customer.
Criteria commonly used to categorize products. By the level of involvement in their
purchase.
When launching new products:
First, you should have clarification of which consumer need you're trying to satisfy and
what type it is.
Secondly, verifying that your essential product is capable of satisfying that consumer-
specific need. Otherwise, redesign your product's main benefit.
Third, understand how to communicate your essential product to create the
consumer's experience more gratifying and protect your competition down the line.
 Product mix: refers to the quantity of the product lines within
the categories that the organization place in.
A product line is a group of products that fulfil the same
function.
Each product line can be described in terms of their depth,
breadth and length the total number of elements of product
line.
 Situation analysis
Competitor
Customer analysis
Category attractiveness
 What questions will you ask when you do competitor analysis?
Why customers buy from them?
What market/segments your competitor serves?
What benefits they offer, pricing, promotion?
Where is competitor investing?
Who are the key clients of the competitor?
Which markets or products competitors focus on?
Area of strength for the competitor?
Amount of resources available to the competitor for their investment.
What are various levels of competition?
 Managerial judgement
What are the KSF factors manager has to keep in mind while
assessing competitors?
Customer Based Measures
Actual purchase/usage data (which level of competition can be
accessed through this?)
Consumer Judgements
Which analytical techniques are used to assess consumer judgements of
competitors?
 Sources for actual purchase data are:
Recorded data: annual reports, brochures
Observable data: pricing, advertising, patents
Opportunities data- anecdotal from suppliers, customers,
tradeshows, distributors, ex employees
Competitor profiling coalesces all the relevant sources about the
competitor into one framework. What is that framework called?
Brand switching matrix
 Solve an existing problem for people. There are thousands of problems in the world. Create a
product that can provide a solution to one of those problems.
Find out what's the current hot trend.You can find out what the new trends are by watching T.V,
reading magazines and surfing the net. Just create a product that's related to the current hot trend.
Improve a product that is already on the market.You see products at home, in ads, at stores etc.
Just take a product that's already out there and improve it.
Create a new niche for a current product. You can set yourself apart from your competition by
creating a niche. Your product could be faster, bigger, smaller, or quicker than you competitor's
product.
Combine two or more products together to create a new one. For example, you could take a
brief case and add a thermos compartment inside to keep a drink hot or cold.
Survey the people who visit your web site. You could post a survey or questionnaire on your web
site. Ask visitors what kind of products they would like to see on the market.
You could create a new market for your existing product. For example, if you're selling plastic
bottles to a pop company, you could turn around and sell those bottles to a fruit drink company.
 Downfall Of Vanilla Products: Marketers must offer more
services and than ever before- customize, personalise
Consumer Needs and Wants Change: They have more
information: virtual communities
Constantly Evolving Platforms: 2 way interaction- SM as
passive and active way of listening
Product Reaches End Of Its Product Life Cycle
Increasing competition
 Find out a company which is involved in easing out day to day chores of your life.
Think about your daily routine and make a list of all those companies which reduce
any kind of frustration.
The same company is coming up with a new product launch. It can be a an new
product/service which gives you a hassle free life making your regular day easier.
Design a basic product strategy, from the name of the product, explaining your
product mix with the already existing products from that company, how you
will innovatively grow your product offering, clearly stating strategies and the
reasons for the same, competitor analysis stating the levels of competition.
You have to suggest an idea URGENCY:You have got a chance to put across the
idea in the board of directors meeting happening in next few hours. You can pitch
your idea in just five slides.
You have 25 min and team of 7-8, use online resources.
The product/idea/service that you propose must solve an existing problem for
people
 What are the key questions you will ask when you do customer
analysis?
Who buys and uses the product? Key decision making unit?
What customers buy and how they use it?
Where customers buy?
When customers buy?
How customer choose?
Why they prefer a product the product chosen ?
How they respond to marketing programs?
Will they buy it again?
 Concept of value
Benefits offered- Costs Involved
What are the sources of customer value (Benefits)?
Functional
Psychological
Economic
 We measure
Satisfaction= Expectations of performance- perceived
performance
What are the indirect measures of satisfaction?
What are the steps in Customer analysis?
Understand the needs of your customer
Understand your product market fit? Identify how your product can
satisfy those needs
Customer segmentation is the practice of dividing a customer base into
groups of individuals that are similar in specific ways.
Segmentation of a market to reach a target consumer base can be done
by defining consumers in terms of geographic, demographic,
psychographic, and behavioural characteristics.
Desirable criterion for segmentation?
Segmentation in B2B markets (example: Asian paints launching paints
for refrigerator companies) what will be the criterion?
How do you statistically generate segments?
based on their motivations and corresponding
frequency of theatre visits
 What should Tom Casola do?
Main Dilemma
 It is important make sure you turn your gate-keepers into
collaborators
Understand the behaviour of your TG at each stage of buying
process
one major challenge is product and TG fit .. easiest consumer
may not be the best consumer .. Understanding the timing,
modification in the offering or transformation of consumer
preference is important.
u have to be careful while setting the expectation in the
message right positioning in the media is essential.
 When you launch a product, the key aspect to keep in mind is:
Role of 5cs
Channel management: Cost, coverage, control
Key questions should be:
Who should be your customer and who is your consumer?
How do you forecast sales for a new product?
How does a product line strategy counter with a brand strategy? (In case
of Umbrella brands)
How does your customer make decision?
What is the right fit between product and target market?
How do u want to set your products positioning in the customers mind?
Lecture 6-9
FACULTY NAME:
Assistant Prof. Sakhhi Chhabra
 You are a product manager at amazon and you have proposed
an idea for extending the brand to a new category of food
delivery. How will you understand category attractiveness?
What will be the structural factors affecting the category?
What will be the indictors of attractiveness of a product
category?
 Aggregate market factors which determine attractiveness of a
market
Category size
Category growth
Stage of product life cycle
Sales cyclicity: why do we need this?
Profits
Category factors can be identified using porters' five force
IKEA entering India what framework they would use to analyse a
category
PESTEL
 Market potential is defined as the total amount of all brands
in a product category that could possibly be sold to the
market.

Sales potential is defined as the total amount of a single

brand that could possibly be sold to the market.
 Information required is
Define your TG and market segment
Your geographic boundaries
Average selling price
Average annual consumption
 Ring analysis or radius defined by creating a circle from a biz
location. Allows you to understand the TG
Drive time analysis: it gives a closer estimate of market
potential
Once the market area is defined you identify TG (age, gender,
personality, HH, religion, lifestyle, etc.)
Next you identify Consumption and usage: how often they
use product and service
 The simplest form of calculation is
Market volume

quantity of product acquired per buyer

number of buyers in a given period.
 Market potential typically refers to total sales possibilities.

Market value =

market volume the average price per unit.

30M have hair loss

2/3rd are concerned: 20M

considers it a current problem: 10M

30% of target consumers become aware: 3M

Out of which only 1M consumers see the doctor

75%-85% get the prescription: 0.8M
 Clearly define what problem you are solving and for
whom this will give you a good idea of the number of
customers with that problem in the geographies that you plan
to be available in.
Estimate the practical reach
Apply some filters i.e. ability to pay, ability to reach via
media, etc.
 Entry/Exit Decisions
Defining sales territories
Allocation of marketing resources: sales person, advertising
expenditure, sales promotions
Settling sales quota: Potential for each territory is different
 Launch strategy for a really new product. (ACCORD MODEL)
Pre-emptive positioning/first mover advantage.
The role of branding in relation to these issues.
Important issues of consumer behaviour while launching new products
Factors that inhibit/facilitate the adoption of a new technological
product.
Habit formation/disruption.
Empowering consumers with more control over their consumption
experiences, in order to enhance targeted marketing.
Consumer privacy.
Structural impact of information technologies on the functions and power
of the various actors in the entertainment/advertising industry.
DETERMINE PRICES FOR NEW PRODUCTS:
 Why should we understand perceived value
while pricing new products?

PV>PRICE>VC = situation of sellers remorse you are leaving

money on table

Price> PV> VC = consumers wont buy considering it a bad deal,

thus to understand downward price adjustment, we use PV
RESEARCH METHODS FOR OBTAINING DATA
USED TO DETERMINE PRICES FOR NEW
PRODUCTS:
LITERATURE REVIEW
DIRECT PRICE TECHNIQUES
Direct methods are based on willingness to pay (WTP)
estimation. In this approach a simple open ended question
regarding WTP is asked for a specific product

GABOR-GRANGER INDIRECT PRICE MODELS

Gabor-Granger technique is a practical and convenient
pricing method to determine the maximum price a
respondent is willing to pay for a given product using a
series of predetermined price points (Gabor & Granger,
1965).
It is best suited for pricing situations that are later in the
product development cycle and the company has a clear
idea of range of prices they want to use.
DISCRETE CHOICE MODELS (DCM)
DCM is best in the situations when simulating
immediate response to competitive offerings,
especially brand and price studies. Decisions are
made on the basis of relatively few, well-known,
concrete attributes.
The advantages of this approach is that it is
reflective of real world marketplaces with
competing products
The disadvantage of this approach is that it is not
easy to handle many attributes and also difficult
to truly predict preference share.
What is VW model all about?
Too Cheapat what price does this product become
too cheap, that you would question its quality and not
buy it?
Cheapat what price does this product start to seem
cheap to you, that is, when does it start to seem like a
bargain?
Expensive At what price do you perceive that the
product is beginning to get expensive, so that it is not
out of the question, but you would have to give some
thought to buying it?
Too Expensiveat what price does this product
become too expensive, that you would not consider
buying it?
ABOUT VIVEL CELL RENEW AND SAMPLE
The target segment for the study was
females with the age group of 20-35,
SEC A- the mid-premium segment
(based on the SEC classification)
A sample of 240 respondents could be
collected in two weeks time
Respondents were recruited
purposively with quota sampling in and
around Delhi.
Currently, the body lotions available in
market are Dove, Garnier, Lakme,
Lotus, Nivea and Vaseline ranging
from Rs. 130/- to Rs. 270/- for 250ml.
QUESTIONNAIRE.docx
The PSM model indicates consumers want that the price of 250 ml SKU ~
Rs.165 mark
Too Cheap Cheap Expensive Too Expensive

Lower Threshold Upper Threshold

Optimum
Consumer
Price point

Rs 130 Rs 140 Rs 150 Rs 160 Rs 170 Rs 180 Rs 190 Rs 200 Rs 210 Rs 225 Rs 240 Rs 250 Rs 260 Rs 270

But what is the best price point from the manufacturers/marketers point of view?
VCR Purchase Intention
Price Points Rs. 150 Rs. 170 Rs. 190 Rs. 225
Sample Size 240 240 240 240
Intention To Buy
Will Not Buy It 6 5 14 65
May Or May Not Buy It 15 10 12 34
Will Probably Buy It 30 40 34 72
Will Definitely Buy It 89 94 68 22
Will absolutely Buy It 100 91 112 47

Data among any exposed

The Intention to Purchase data further supports that Rs. 190 is the most
viable price point

Intention to Purchase Rs. 170 Rs. 190 Rs. 225

Sample Size 240 240 240

Gap
Will definitely buy 94 69 47 22

Will absolutely buy 91 112 65 47

 REJECTORS ARE PREDOMINANTLY FROM
YOUNGER AGE GROUP & VASELINE USERS

Price Points Rs. 170 Rs.190

Sample Size 240 240

Profile for rejecters*

Age Group
20 29 years 78 156
30 35 years 162 84
MOUB
Dove 19 43
Garnier 58 45
Lakme 62 12
Lotus 19 17
Nivea 39 55
Vaseline 43 68
LIMITATIONS
PSM approach may artificially make consumers overly price
sensitive by forcing internally rational responses.
Further, this technique works well when testing experience
related products with like skin cream, razor, etc. but
modifications to the technique may be useful when the product
is a new to the world idea and consumers do not have a
precedent for determining what price would be reasonable.
Hypothetical situation:

The director of JMD Oils (Indian), an edible oils firm, is

considering the strategic options to drive his company to the
next level of sales and profitability.
The business has been showing a steady performance, but he
feels that it could improve substantially.
To increase profits, the director could increase sales volumes or
increase gross margins.
An increase in volume could be achieved by increasing the
geographical footprint, which would require setting up
additional factories.
Increasing the margins would require a shift from a dealer push
strategy to a consumer pull strategy, which could be achieved
by brand building.
What should the director do in order to analyse and solve the
situation?
 Imagine you are working in Snapdeal and with its current
situation the senior manager has asked to downsize the
operations and you have to cut down the product breadth.
How will you make a decision, as to which category should be
retained and which one should be dropped.
What will be the key decision criterions?
Relative market share (meaning relative to your competition)
and Market Growth.
Market attractiveness and strength of a Business unit.
 Example 1: A restaurant sees a drop in wine sales when they begin
to offer craft beers.
Example 2: A hotel spa sees bookings drop when the hotel opens a
rooftop pool and bar with a view.
How do u decide as a product manager if cannibalization has
positive or negative effect?
Suggest Ways to turnaround negative aspect of cannibalization to
positive?
Cannibalization refers to a reduction in sales volume, sales
revenue, or market share of one product as a result of the
introduction of a new product by the same producer.
 What is Chris Considering given the case scenario?
Introduce Mountain Man Light
Target market Position
Advertising/promotion plan Budget
Cannibalization

Do not introduce
What goals should MMBC(Chris) have?
Other options?
 What made MMBC Successful?
What distinguishes it from competitors?
What is distinctive about MMBCs product?
What is distinctive about MMBCs customers?
How is MMBCs promotion different and effective?
How these factors enabled MMBC to create such a strong
brand?
What is Brand Equity? How is it created?
 Brand
Equity

Brand Brand Perceived Brand

loyalty awareness Quality Associations
 Concept of a product line extension using an existing brand name
and inherent risks and benefits.
Concepts of cannibalization and brand alienation.
Understanding the elements of a strong brand.
Learn the concept of brand equity, how it is created, and how
brands can be used as platforms for growth.
Concept of congruent vs. incongruent line extension.
Estimating the financial impact of a product line extension
decision.
Difficulty in choosing between qualitative and quantitative data in
making key strategic decisions.
Concepts of marketing metrics-Breakeven analysis