Product Line

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Do Now:
What do all t
he products on display have in common?
Complete our entrance slip for your chance to earn a
SELFIE WITH LIEB$$$!
What do all of the products
have in common?
 They are all produced and distributed by PepsiCo
 Fun Fact: “Pepsi” (the soft drink) is only a very small
fraction of the PepsiCo product line
 PepsiCo is considered the Parent Company
 A corporation that controls, manages and operates
several different brands, which are all a part of one
majority owner
Product Mix:
 All the different products that a company makes or sells
How can you organize Pepsico’s
product mix?
Product Line
 A group of closely related products produced by a
business
Energy Drinks
Oatmeal
Cereal
Soft Drinks
Energy/Coffee Beverages
Juices
Cereal
Snacks
Soft Drinks
Sport Drinks/Water
Breakfast Bars/Granola Bars
Check out all of
PepsiCo’s top
brands
Further Distinctions….
Product Width
 The number of different product lines a business
sells
 The CATEGORIES of products
Product Depth
 The number of product items offered within each
product line
 The VARIETY within each category
Width and Depth of the Gillette Product Mix
Blades &
Razors
Toiletries
Mach 3
Sensor
Sensor for Women
Trac II
Atra
Swivel
Lady Gillette
Super Speed
Venus
M3Power
Fusion
SatinCare
Complete
Right Guard
Silkience
Soft & Dri
Series
Adorn
Toni
Dry Ideas
Dry Look
Complete Skincare
Writing
Instruments
Paper Mate
Flair
Lighters
Cricket
S.T.
Dupont
Activity: La Piazza Product Mix
 Working in your group, complete the La Piazza
Product Mix assignment. Be prepared to present to
class.
AIM:
How can new products help/hurt a
business?
Do Now:
Hand in homework.
Why do businesses introduce
new/improved products?
Line Expansion
1.



A company adds width
May or may not be related to current
products
May expand target market
Line Extension
2.



A company adds depth (more options) of products
Related to current products, adds variety
Done to keep up with trends; psychographics
Line Expansion: Tylenol
 What product lines does Tylenol have?
 Tylenol introduced different categories of medicine to
satisfy the needs of their consumers
Line Extension: Tylenol
 Tylenol has added variety within their product lines
 How does this line extension show that Tylenol tries to
adapt to consumer’s lifestyles/wants/psychographics?
TYLENOL COLD AND SINUS
Rapid Release Gelcaps
Citrus Burst ™ Liquid
Gelcaps
Coolburst Caplets
3. Product Modifications
 Altering a company’s existing product
 Old product is phased out
 A relatively easy and inexpensive way to add new
products to a company’s product line
•Nintendo
Omaha Steak Study
• Take Out The Omaha
Steak Article
• Answer Part A
• You will be given a
partner, combine your
answers for Part A.
• Start Part B
• You will be given
another set of partners
(Answer Part B)
• Turn in One Set of
Answers and Chart
Project Ideas
• Mix/Dept
h/Expand/
Extend
• Mix/Dept
h/Expand/
Extend
Line 1 (Examples)
Line 2 (Examples
• Mix/Dept
h/Expand/
Extend
Line
1
Line
2
Line
4
Line
3
Line 3 (Examples)
Name of
Company
• Mix/Dept
h/Expand/
Extend
Line 1
Line 1
Line 2
Line 3
Depth
Line 2
Depth
Line 3
Depth
Marketing Story of the Day
 https://www.youtube.com/watch?v=kXAngeGDZwY
TUG OF WAR
 Part 1: Individually, come up with 3 ways to support your
stance you were provided. (Write them on your note sheet)
 Part 2: In your assigned group, each person will share what
they have come up with.
 Part 3: Take all ideas that were shared and as group, come
you with your top 3 reasons to support the stance you were
provided with. Write each reason on a separate post-it.
 Part 4: Choose a spokesperson to come up, place your postits along the tug of war and explain your reasoning.
Remember, the strongest point is closest to the middle of
the rope!
Do Now:
Tug – Of – War
Do New Ideas For Products/Product
Expansions Help or Harm a Business?
Build on an established
image
Better their image
Appeal to new markets
Capitalize on new
trends
Increase sales and
profits
Can be costly (inventory,
promotion, storage,
distribution, training)
Take sales away from
existing products
Can hurt image (Apple
Maps)
Analyzing Apple’s Development
AIM:
What steps go into the development of new
products?
Do Now:
Nike (Save Coke Article For Another Day)
http://www.cbsnews.com/news/30-years-ago-todaycoca-cola-new-coke-failure/
https://www.youtube.com/watch?v=QkfFdQ1yaqs
https://www.youtube.com/watch?v=8_hvOBnsirI
Nike has just come to you for help!!!
They want to develop a new product
to add on to one of their existing
product lines.
What type of product should Nike
add?
What product line would it be a
part of?
Why should they add this product?
New Product Development
 The process used to be a lot longer (1-2 years) than it is
now (6 months to 1 year)
 Why do you think this is?
 Competition is fierce
 Technology continues to develop rapidly
 Consumer’s preferences are constantly changing
 Changing external landscape (environmental issues)

Ex: Increasing fuel costs  Development of hybrid cars
Product Development Process
Generating Ideas
1.
Customers
Competitors
Employees
Focus groups
Identify changes in the market





Screening Ideas
2.
Products are matched against company objectives
“What can we do to take advantage of this opportunity?”
Focus Groups




Likes vs. Dislikes
Product Development Process (cont)
Business Proposal
3.


Evaluate: size of market; potential sales; costs; profit
potential; technological trends; competition; risk;
efficiency of production
Identify all contributing factors
Developing the Product
4.


Prototype developed
Marketing strategy developed
–
–

Packaging, Promotion, Labeling, Distribution…
How will we get our target market to notice the new product?
Can you really produce the product in mass quanitites?
Product Development Steps (cont)
Test the Product
5.



Determine a test market
Can be based on geographics, demographics
Apple vs. Google
Introduce the Product
6.




Full market introduction = commercialization
High costs (Advertising, Distribution, Training)
Small/lesser known companies usually introduce regionally
first
Apple Maps
Evaluate Customer Acceptance
7.


Sales information
Surveys
AIM:
What is the product life cycle?
Do Now:
Classic board games like Monopoly and Candyland
have been replaced by hi-tech video games that can
be played on the Wii and Xbox gaming systems.
What has happened/what have the board game
companies done to reintroduce these games to
today’s youth generation? Do you think it will work?
Product Life Cycle
 The stages a product goes through during its life
 Marketers adjust the product mix and marketing
strategies at each stage to ensure continued sales of their
products
Introduction Stage
 Focus on promotion and production
 Special Promotions/Free Trials
 Advertising focused on product awareness and
benefits
 Main Goal = gain customer attention/usage
Growth Stage
 Start to increase sales and profits
 Most of target market knows about and buys product
 Consumer satisfaction is most important
 You want them to return as customers = customer loyalty
 Sometimes companies conduct Product Modifications
(to improve features)
 Some small companies are bought out by bigger ones
Maturity Stage
 Sales level off/slow down in comparison to growth stage
 Most of target market owns product
 Face extreme competition… WHY?
 Marketing to fight off competition = Increased
marketing expenses
 Decisions must be made about the future
Decline Stage


Sales Fall
Profits < Costs
Options:
1. Delete Product/Product Line






Obsolescence = change of interests, new technology
Loss of Appeal = consumer tastes and trends change
Conflict With Objectives
Replaced With New Product
Lack of Profit
Conflict with Other Products in Line
Decline Stage- Options (cont.)
2.
3.
4.
5.
6.
Sell or License Product
Recommit to the Product Line
Discount the Product
Regionalize the Product
Modernize/Alter Product Offering
Fad Life Cycle
Product Life Cycle Quirks
Not every product fits nicely into the same cycle
1. There is not a definitive line dividing each stage

The stage is determined by the characteristics that the product is
experiencing
Fashion Life Cycle
2. There is no set time period for each stage

Ex: Successful products can spend years in the maturity stage
3. Some markets/types of products have completely altered life
cycles


Fads
Fashion
iPad Debate – Kahoot It
 Debate Question - What phase of the product life
cycle is the iPad in?
 As a group, you have 5 minutes to explain why you feel
the iPad is in that specific category of the product life
cycle. Your group will come up and state your
reasoning.
 In order to make a strong case, you need to:
 Make 3 points that back up your answer.
 Be Convincing!
AIM:
How do companies position their
products?
Do Now:
Take out your homework – CVS article
Be prepared to discuss.
Activity
 Based on the article you were assigned, answer the
following questions:
1. What do you think it means to position a product in
the market?
2. Name of brand and specific product (if relevant)
3. How was the product positioned BEFORE the ad
campaign? Describe the target market.
4. How is the product being repositioned? Describe the
new target market.
5. Will this repositioning be a success? Explain.
Barbie Positioning
Chevy Malibu
General Mills
Product Positioning
 The image a product projects
 How do consumers view your brand vs. a competitor
 Goal = set your product apart from the competition
 Create a product identity
 Placement
 Marketing Strategy
 Selling Techniques
Positioning: Price and Quality
 Economy, Mid-Priced, or Luxury
 High Price = High Quality
 Low Price = High Value
The Car Market
BMW X6
Honda Accord
$21,860
$13,950
Honda Fit
VS.
Audi Q5
$72,800
$54,250
Positioning: Features & Benefits
 Highlight unique characteristics
 Popular Examples:
Convenience, Comfort, Portability, User-Friendly
Positioning: In Relation to the Competition
 Apple v. PCs
Positioning: In Relation to Other Products
in a Line
 Washable crayons within Crayola’s Crayon Line
 Why would a company do this?
 Not to “compete” with itself
 Appeal to a more specific target market
Wendy’s
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