NOTES ON THE INTERACTIVE EXERCISE
Overview of Interactive Exercise on Product-Market Definitions
The purpose of this exercise is to help students see the product-market definitions behind
products that are advertised. Print ads are provided for three different products; students
are challenged to identify the correct components of the product-market definition for
each one.
Concept Review
A market is a group of potential customers with similar needs who are willing to
exchange something of value with sellers offering various goods and/or services. As
pointed out in the text, marketers should not just focus on products that they sell in
defining the market. They need to be able to distinguish different levels of the market.
Doing so will help to identify opportunities and potential threats.
A generic market is a market with broadly similar needs and sellers offering various ways
of satisfying those needs. Defining the market broadly can help the marketer to uncover
some potential new opportunities. The marketer can then narrow down to specific
product-markets.
A product-market is a market with very similar needs and sellers offering various close
substitute ways of satisfying those needs. A complete product-market definition includes
four parts:
 Product type--the type of good and/or service offered.
 Customer need--refers to the need(s) of the customer (user) that are being met by the
product.
 Customer type--identifies who specifically is using the product.
 Geographic area--identifies where the market is located.
Using the Exercise
Initial Screen
1. This screen introduces the product-market definition exercise.
A. The professor can begin the exercise by clicking on one of the ads.
B. The exercise will automatically transition to the next screen.
Next Screen
2. The first ad chosen is shown in larger size. An enlargement icon appears in the
bottom of the screen so that the ad can be made bigger.
A. The professor reads the key elements of the ad copy to the class.
B. The professor then clicks the advance button at the bottom of the screen to
advance to the next screen.
Next Screen
3. On the left-hand side, there are boxes containing the four main elements of the
product-market definition. On the right-hand side, there are four possibilities for each
of the elements of the product-market definition.
A. For each element of the product-market definition, the professor asks the
class which possibility on the right-hand side best fits the advertised
product. The professor then clicks on the box containing the choice, and
holding down the left-hand mouse button, drags the box over to the
corresponding element of the product-market definition. When the choice
is correctly positioned on top of the element of the product-market
definition, the professor releases the mouse button.
B. If the choice is incorrect, a “negative” sound will be heard and the choice
will return to the right-hand side of the screen. If the choice is correct, a
“positive” sound will be heard. For details related to right and wrong
answers, refer to the ANSWERS AND EXPLANATION section below.
C. The selection process is repeated until all elements of the product-market
definition have been identified.
D. At this point, it would be fruitful for the professor to reinforce the
difference between a product-market definition and a generic market
definition (the generic market definition has no product type).
E. It would also be helpful if the professor asked the students to brainstorm
examples of opportunities that might be available if the marketer
developed: (1) a narrower product-market definition; or (2) a broader
generic market definition.
F. This is also a good point for reinforcement of the types of market
opportunities that are discussed in Chapter 2: market penetration; market
development; product development; or diversification. The students can
brainstorm how these types of opportunities are linked to the market
definitions used.
G. Clicking the “NEXT” button will transition to the next screen, where the
professor can select the next advertised product to discuss.
H. The professor repeats the selection process described in step 2 until each
of the three advertised products has been explored.
Final Screen
4. The final screen matches each advertised product to the elements of its productmarket definition. The professor clicks the “X” icon in the upper right corner of
the screen to end the exercise.
Answers and Explanations
PRODUCT 1: SMARTPAD
PRODUCT TYPE CORRECT ANSWER: Electronic Notepad
The product’s advertisement clearly illustrates the product type is an electronic
notepad. Although the product is a companion to a personal digital assistant (PDA), it
is not a PDA itself, in that it is not a stand-alone product. Nor does it perform the
functions of a calculator or provide Internet access. A PDA might be able to do these
things, but not the SmartPad.
CUSTOMER TYPE CORRECT ANSWER: Working Professional Adults
These are the consumers who are most likely to be the targets for the SmartPad. One
could make the argument that elementary school children, senior citizens, or “blue
collar workers” could be consumers or users of the SmartPad. However, the main
target audience is working professional adults.
CUSTOMER NEED CORRECT ANSWER: Electronic Notetaking
This product provides a solution to a common problem plaguing PDA users: how to
take notes and enter text or sketches in an efficient way. It does not, by itself, meet
the needs of consumers for remote Internet access, multimedia production, or digital
photography.
GEOGRAPHIC AREA CORRECT ANSWER: Industrialized Nations
Although the SmartPad would probably have some users in agricultural areas or lessdeveloped countries, its main market would be in industrialized nations, because
more PDA users would be found there. What about fast-growing countries? As is
discussed in Chapter 5, many fast-growing countries are less-developed nations, and
so they would not fit the product-market definition as well as industrialized nations.
PRODUCT 2: RESCUE
PRODUCT TYPE CORRECT ANSWER: Fuel Additive
The product’s label clearly states that the product is a fuel additive. It has nothing to
do with the windshield washer, the tires, or the engine lubrication.
CUSTOMER TYPE CORRECT ANSWER: Automobile Owners
Middle school children are not the primary consumers of this product, because they
do not drive or make decisions about automotive products of this type. They could be
indirect beneficiaries if they were passengers in a car in which the product was used,
but they are not the main target audience. Professional truck drivers typically use
diesel fuel, not gasoline, so the product would not be marketed to them. Auto racing
teams would have no use for the product. Everyday automobile owners are the
intended audience.
CUSTOMER NEED CORRECT ANSWER: Safety
This product’s advertisement indicates that this product provides safety against
running out of fuel. It does not enhance engine performance, provide better fuel
economy, or reduce exhaust emissions.
GEOGRAPHIC AREA CORRECT ANSWER: Industrialized Nations
Like the previous example, this product would probably have some users in
agricultural areas, less-developed countries, or fast-growing countries. Its main
market would be in industrialized nations, because more car owners would be found
there, along with more sophisticated road and highway infrastructure.
PRODUCT 3: FLASH PLAYER
PRODUCT TYPE CORRECT ANSWER: Internet Plug-In
The product is a plug-in device usually downloaded for free from its producer’s
Internet site. It is not an Internet browser or music download service, although it may
work in conjunction with them. It is not a word processor.
CUSTOMER TYPE CORRECT ANSWER: Internet Users
Because the product could be useful to anyone who accesses the Internet, a broad
customer type definition is needed here. Senior citizens, “blue collar” workers, and
single parents also use the Internet, but any one of those groups alone is not large
enough to capture the breadth of the customer type.
CUSTOMER NEED CORRECT ANSWER: Web-Based Media Playback
The main need satisfied by this product for most users is that the product makes Web
browsers more functional. The Flash Player is not a production tool for multimedia or
computer-aided design, and it does not provide e-mail capability.
GEOGRAPHIC AREA CORRECT ANSWER: World
The Flash Player is a plug-in that would be useful to Internet users the world over, not
simply in one country.