Product planning
- 1. PRODUCT PLANNING Made by~~ Kushal Singal BBA 1722
- 2. What is a product? A product is anything that can offered to market for attention, acquisition ,use, consumption that might satisfy a want or need.~Philip Kotler Products can be both tangible(eg mobile phones) and intangible(eg service by a doctor) To create successful new products, the company must: understand its customers, markets and competitors .
- 3. Why product fails? Doesnt match current company objectives Incorrectly positioned, priced, or advertised Overestimating market size Poor marketing research Obsolete No longer profitable Excessive development costs
- 4. What is product planning? Product planning is the process of creating a product idea and following through on it until the product is introduced to the market. Product planning entails managing the product throughout its life using various marketing strategies, including product extensions or improvements, increased distribution, price changes and promotions. It starts with the generation of idea and continues till the time the product is ready to be launched in the market. Proper product planning is sine qua non for the growth of a firm , absence of product planning would lead to wastage of time and resources.
- 5. Benefits of product planning~ Efficient Service to Customers- enabling production to be conducted in accordance with the time schedules and therefore deliveries are made on promised dates Co-Ordination- It serves to co-ordinate the activities of plant and results in a concerted effort by workmen Effective Utilization of Resources- It reduces the loss of time by the workers waiting for materials and makes most effective use of equipments. Cost Reduction- Production control programmes minimizes the idleness of men and machines . Avoidance of Bottlenecks- The incomplete work does not get accumulated.
- 6. Why to develop new products? To replace declining product To take advantage of new technology To defeat rivals To maintain/increase market share To maintain competitive advantage
- 7. Procedure for product planning~ Determine corporate objectives Determine product policy Determine criteria for evaluation Idea generation Research for product Development of product Product testing Research of market Engineering of production Introduction of product in market
- 8. Determine corporate objectives~ Every firm must work within the framework of certain objectives. Therefore it is important that the objectives are clear and there is no ambiguity. It is vital for the success of the firm to function within the ambit of its objectives. OBJECTIVES SHORT TERM Increase sales Increase profit LONG TERM Growth Customer satisfaction
- 9. Determine product policy~ A company must analyse its weaknesses and strengths with respect to its history ,personnel and resources. Every firm has limited resources therefore it is vital that the resources are put to their most productive use.
- 10. Example~ Amazon started in 1994 as a bookstore.
- 11. And now~~
- 13. Development of new ideas~ Dreamers are mocked as impractical. The truth is they are the most practical, as their innovations lead to progress and a better way of life for all of us. Robin S. Sharma Innovation is the way forward in todays world of cut throat competition. Only the companies With new idea would be able to survive in todays world. Idea generation ranges from incremental improvements to existing products to new to the world products. ( produce a drug to reduce cholesterol with less side effects = improvement produce a drug that cures ebola = new to the world product)
- 14. Sources of new ideas INTERNAL EMPLOYEES EXTERNAL CUSTOMERS COMPETITORS DISTRIBUTORS FOREIGN FIRMS
- 15. New brand line adopted by philips innovation and you Looking to convey its belief that innovation is only meaningful if it delivers on peoples unmet needs and desires, the creative highlights the ways in which Philips products and services fit into peoples lives. : Our commitment is to deliver innovation that matters to people, by making healthcare more affordable, improving peoples health and wellbeing through our consumer appliances, and making the world more sustainable through our lighting solutions.
- 17. Lack of innovation~MOTOROLA Its first big success came with car radios, which led to two-way radios, which eventually led Motorola to build and sell the world's first mobile phone. Motorola dominated that business as recently as 2003, when it introduced the trendy Razr, the biggest-selling mobile phone ever at the time. But Motorola failed to focus on smartphones that can handle E-mail and other data, and rapidly lost share to newcomers like Research in Motion, Apple, LG, and Samsung. Motorola was vanquished so swiftly that its cell phone division became a perennial money-loser.
- 18. R&D for product~ Nowdays almost every organisation has a separate department for R&D this itself implies its importance . The world is dynamic and is changing every second thus it it important to adapt to the changing world to stay in competition and for this research is required. Developed countries spend huge amount of their resources on R&D. Development includes the ability of adaptation of others idea to cater the needs and requirements of a company.
- 19. Data on R&D spending~ US spent $405 billion on R&D i.e 3% of its GDP in the year 2012 China spent $296 billion on R&D i.e 2% of its GDP, whereas India spent merely $36 billion on R&D i.e not even 1% of its GDP SAMSUNG alone spent $11 billion on R&D in the year 2013.
- 20. Concept testing~ Idea has to be developed into a concept A concept is a detailed version of the idea stated in a meaningful consumer terms. The developed concept will be tested among a sample of consumers. This will be presented to the target market in words or pictures or a prototype of the product is made. Few questions will be asked to check whether the target market will buy the product. Concept testing of prototypes can help avoid costly mistakes. This helps in knowing the reaction of the customers upon the launch of the product and weather they will find it useful or not.
- 22. Market research / Test marketing~ Understanding the market is of utmost importance , market offers various opportunities and threats and it is important to grab the opportunities at the earliest. During the test marketing, the marketers offer the product for sale in a limited area where they can measure the response. Based on the results of test marketing, marketers determines how the marketing mix should be adjusted before a full scale launch.
- 23. This helps to estimate sales of the product in the market upon its launch. This information helps the firm to plan accordingly and it can calculate the cost involved and the profits that the firm will be able to earn. If the product gets a positive response then only the firm decides to launch it in further markets otherwise the firm stops the development of the particular product and starts the process all over again with new and better ideas.
- 24. How market research helped Instagram Kevin Systrom and Mike Krieger put a full year of work into a new location-based, check-in app called Burbn, even developing a full-fledged iPhone app. After releasing the app, the team wisely chose to reevaluate the market. "If felt cluttered, and overrun with features," Systrom said. He and Krieger also faced reality: they were late to the game in a trendy space already dominated by Foursquare. They removed almost all of their features, leaving only photos, commenting, and liking. They rebranded their business as Instagram. By looking closely at the market, understanding their strengths, and researching competitors, they were able to make the right call. Facebook bought Instagram in late 2012 for nearly three quarters of $1 billion in cash and stock
- 26. Engineering the production~ If the market research shows a positive sign then the next step is to arrange for resources i.e manpower , machinery , money , material etc which would be required for the production process. In this the final decisions regarding the production of the product are taken. Decision regarding the price , promotion and advertisement of the product are also taken. Price plays a very important role in the sales of the product therefore the price should neither be to high nor too low.
- 27. Launch of the product~ This is the last step in the procedure of product planning. Product is finally launched In the market this has to Be supplemented by a good Advertising plan so that all Consumers are aware About the launch of the Product and how it would Help them.
- 28. Thank you