The anatomy of a product and the
product concept document
Hoorcollege marketing blok 2 week 4
Hogeschool van Amsterdam
Interactieve Media
Learning goals
 By the end of this week’s colleges and the reading
you should
 Be able to explain what a product is
 Be aware of the different types of product there are
 Understand the three levels of a product and why this is an
important idea
 Understand the key decisions that must be made when
developing a product
 Know how to develop a product concept document
Hogeschool van Amsterdam
Interactieve Media
Agenda
 What is a product?
 Why is product important in interactive media
 Three levels of a product
 Key product decisions
 The product concept document
 Positioning and the product concept
 Summary
Hogeschool van Amsterdam
Interactieve Media
Where are we now?
Hogeschool van Amsterdam
Interactieve Media
What is a product?
Hogeschool van Amsterdam
Interactieve Media
Definition of a product
 A product a thing (or a service) that is offered for use
to a target customer / user with the aim of allowing
them to satisfy needs and/or wants
 It helps them achieve their goals
 It helps them solve their problems
Hogeschool van Amsterdam
Interactieve Media
The term “product” is used broadly
Hogeschool van Amsterdam
Interactieve Media
Products and interactive media
 By its very nature interactive media is often about
creating “products” rather than simple
communication
 The level of interaction required is usually (and should be)
greater than a traditional piece of communication
 To be successful we need to understand how to
develop “products” rather than just communications
 We can do this by using the tools used to develop
“physical” products
Hogeschool van Amsterdam
Interactieve Media
Three levels of a product
Hogeschool van Amsterdam
Interactieve Media
A product is more than just its
features
 When developing products marketers usually think
of products as having three levels
 The core (kern) product
 The actual (tastbaar / werkelijk) product
 The augmented (uitgebreid) product
Hogeschool van Amsterdam
Interactieve Media
Three levels of product
Hogeschool van Amsterdam
Interactieve Media
Why is this important?

Thinking about a product in three levels is
important because:
1. Customers buy benefits or solutions to problems

The Core product focuses on these
2. A product is more than just its features

The actual product tool helps us define a more complete
product
3. Actual products today are often quite easy to copy

The brand and the augmented product can give us
competitive advantage
4. We can use this tool as the basis for a product concept
document

A product concept document is critical to the new product
development process since it is the basis of the go/no-go
decision
Hogeschool van Amsterdam
Interactieve Media
Key product decisions
Hogeschool van Amsterdam
Interactieve Media
Key product decisions
Hogeschool van Amsterdam
Interactieve Media
The product concept document
Hogeschool van Amsterdam
Interactieve Media
Introduction
 This is a suggested (so not the only possible) format
for a product concept document
 It is based on the three levels of a product
 Part 1: The customer / user covers the core product
 Part 2: The product covers the key decisions to be
made for the actual product
 Part 3: The extras covers the augmented product
Hogeschool van Amsterdam
Interactieve Media
The customer / user
1. Who is the customer and who is the user?


Firstly are the user and the customer the same person?
You should try to help the reader create a mental picture of the customer /
user: you might use your market segmentation and personas to do this
2. What is the need(s)/want(s) that the product satisfies

Customers buy things that solve problems and help them achieve their
goals, what are these goals?
3. Why your product?

There are possibly many ways to achieve goals, why would the customer
choose your product?

The context-based scenario you developed to show what is wrong with the
current situation will be useful here
4. When, where and how will the product be used?


Think about the time and the place the user will use the product
Develop some positive usage scenarios that show how your product
would be used
Hogeschool van Amsterdam
Interactieve Media
The product

Product positioning

 What brand will be used company or product?
 How is the product positioned
for the target customer?


Quality
Features
 Features provide benefits and
benefits allow users to achieve
their goals
 What features does the
product need to meet the
need(s) that the product will
be developed to fulfil?
 Beware of “feature bloat”
Hogeschool van Amsterdam
Design guidelines
 Are there any minimum needs
in terms of design (think about
size, style etc.). Always leave
the designer room for creativity
 What is the requirement for
product quality?

Brand

Packaging
 Does the product need any
special packaging, or indeed
does it need it at all?

Labelling
 What labelling is required for:
legal requirements, usability,
promotion etc?
Interactieve Media
The extras



What level of service support does
the product need? This will be
affected by your positioning and the
complexity of the service

The level of service for a Chunky
KitKat will be different from a piece
of software that runs a factory



What sort of help do you offer the
customer? Again this is more
important for complex products.
Sometimes it might be just a
manual or a quick start guide, for
other products you may need
online help or a telephone line.
Hogeschool van Amsterdam
Could you offer the customer
training? Does this make sense? If
o, then how do you do this?
Delivery

Do you deliver the product?
Credit


Does the product need a manual?
What type of manual, user manual
or a full technical manual?
Training


Help
Manuals

Will you offer the customer
installation help, do you need to?
Service



Installation
Do you offer the customer credit?
Warranty

Interactieve Media
How long is the warranty on the
product?
Positioning and the product concept
Hogeschool van Amsterdam
Interactieve Media
Not everyone accepts new products
at the same rate
Source: Rogers, E. M., 1962. Diffusion of Innovation, Free Press
Hogeschool van Amsterdam
Interactieve Media
Factors affecting rate of adoption
1.
Relative advantage when compared with alternatives
2.
Compatibility to consumer’s tastes, needs, attitudes and existing
products
3.
Complexity - the less complex the quicker adoption
4.
Divisibility (deelbaarheid) - how easy it is to trial (to reduce purchase
risk) e.g. software
5.
Communicability - ease of communicating benefits
6.
Perceived risk - the cost to the consumer (in money and pride) if they
make the wrong purchase decision
Source: Gatignon, H. and Robertson, T. S., 1985. ‘A Propositional Inventory for
Diffusion Research’, Journal of Consumer Research, 11 (March), pp. 849-867
Hogeschool van Amsterdam
Interactieve Media
Good product positioning helps
adoption
 Product positioning is an important decision in the
life cycle of a product because it helps with the
product adoption process
 Product positioning is about positioning the products
benefits in the mind of the target customer
 Rather like positioning a company, but the focus is on the
benefits of the product
 The aim is to overcome some or all of the factors
that affect new product adoption
Hogeschool van Amsterdam
Interactieve Media
Positioning
 Once we have chosen our
target segment(s) we need
to position our organization
and its offers
 Positioning is about owning
a space in your target
customers mind
Hogeschool van Amsterdam
Interactieve Media
Positioning is natural but it can be
influenced
 We naturally position products
 We organize the thousands of offers into categories
 The aim of positioning as a conscious process is for
us to actively try to get our target customer to
position our offer in a certain way
 By planning a positioning that is attractive to the target
customer
 And by designing a marketing mix that supports this
positioning
Hogeschool van Amsterdam
Interactieve Media
Being number 1 is a good positioning
strategy
 Generally consumers do not remember all the
products they are exposed to
 They organize them into categories or product ladders
 E.g.
 Soft drinks: Coke → Pepsi → Fanta
 Beers: Heineken → Amstel → Grolsch
 The top company is the one they remember most easily
Hogeschool van Amsterdam
Interactieve Media
More than one way to be number 1
 The company or brand that is perceived as number 1 is usually
easy to remember
 However, there is more than one way to be number 1
 Example
 Who crossed the Atlantic first by airplane?
 Charles Lindenbergh?
 Not true?
 Allcock & Brown did it first - Lindenbergh was the first to do it alone
 Being perceived as number one has a lot of advantages
 But there are lots of ways of being number 1
 The trick is to know ensure it is relevant to your target customer
Hogeschool van Amsterdam
Interactieve Media
The number 1 approach to
positioning
 This approach was proposed by Al Ries and Jack Trout in their
book Positioning: The battle for your mind
 They noted that only one company can be number 1
 But they argued that there are many number 1 positions
available, such as:





Biggest
First
Best quality
Most innovative
Etc., etc…
 The trick is to understand what will work for your target
customer
Ries, A. and Trout, J., 1981. Positioning: The battle for your mind, New York: McGraw-Hill
Hogeschool van Amsterdam
Interactieve Media
Three approaches
 Ries and Trout suggested 3 possible approaches:
1. Strengthen your current position in the target customer’s
mind

Avis were number 2 to Hertz in the hire car market, so they
positioned themselves as ‘we’re number two, we try harder’
2. Look for an unoccupied position in the mind of the target
customer

Market holes are places where you can be first (e.g. the
number one MP3 player)
3. Deposition or reposition your competitor

Stolichnaya vodka attacked Smirnoff by being noting that
only their vodka was actually made in Russia
Hogeschool van Amsterdam
Interactieve Media
Levels of positioning
Hogeschool van Amsterdam
Interactieve Media
Positioning and product positioning
 The positioning of a particular product does not
necessarily have to be the same as the brand or
company positioning
 It will often be based on the product’s unique benefits
 However, a product positioning must not conflict with
the brand or company positioning
Hogeschool van Amsterdam
Interactieve Media
How position a product
 Product positioning should be based on the goals of
the target customer / user
 The positioning should show how the product
benefits the target customer in ways that are
appropriate to that customer
 Like brand and company positioning, being number 1 in
some way is one approach
 BUT there is another way
 The successor approach to product positioning
 Your product is the successor (opvolger) to an already
familiar product
 This is like Ries & Trout’s 3rd option
Hogeschool van Amsterdam
Interactieve Media
The successor approach to product
positioning
Hogeschool van Amsterdam
Interactieve Media
Why I Dark Side of the Moon wasn’t
my first MiniDisc
Hogeschool van Amsterdam
Interactieve Media
Summary
 Interactive media by its nature means that we tend
to develop products
 Developing products requires a different way of
working compared to developing communications
 The product concept document is a tool that allows
you to develop products more effectively
 Positioning your product is essential to success
 There are at least two approaches to product
positioning
 Number 1 approach
 Successor approach
Hogeschool van Amsterdam
Interactieve Media