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Products and Pricing

Products and Pricing. Chapter 10. Chapter 10 Objectives. After studying this chapter, you will be able to: Describe the four stages in the life cycle of a product Describe six stages of product development Cite three levels of brand loyalty Discuss the functions of packaging and labeling

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Products and Pricing

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  1. Products and Pricing Chapter 10 ©2007 Prentice Hall

  2. Chapter 10 Objectives After studying this chapter, you will be able to: • Describe the four stages in the life cycle of a product • Describe six stages of product development • Cite three levels of brand loyalty • Discuss the functions of packaging and labeling • Identify four ways of expanding a product line and discuss two risks that product-line extensions pose ©2007 Prentice Hall

  3. Chapter 10 Objectives, cont. • List the factors that influence pricing decisions and identify seven common pricing strategies • Explain why cost-based pricing can be a flawed strategy ©2007 Prentice Hall

  4. Characteristics of Products Insert exhibit 10.1 ©2007 Prentice Hall

  5. Service Products • Intangibility • Testimonials ©2007 Prentice Hall

  6. Consumer Products Convenience Shopping Specialty Unsought ©2007 Prentice Hall

  7. Industrial and Commercial Products Raw Materials Installations Components Equipment Supplies Business Services ©2007 Prentice Hall

  8. Introduction Growth Maturity Decline DVD Players Internet VCRs Cassette Tapes Sales Sales Volume (units) + 0  Profits Time Product Life Cycle ©2007 Prentice Hall

  9. Introduction • R&D through launch • Careful planning • Large investments ©2007 Prentice Hall

  10. Growth • Rapid sales increase • Increase market share • Large profits ©2007 Prentice Hall

  11. Maturity • Longest cycle • Market saturation • Milking a cash cow ©2007 Prentice Hall

  12. Decline • Inevitable • Changing demographics • Product competition ©2007 Prentice Hall

  13. New Product Development Idea Generation Prototype Development Idea Screening Test Marketing Business Analysis Commercialization ©2007 Prentice Hall

  14. Product Identities Branding Packaging Labeling ©2007 Prentice Hall

  15. Brand Name Selection Brand Names Brand Mark Trade Mark ©2007 Prentice Hall

  16. Brand Sponsorship ©2007 Prentice Hall

  17. Function Strategy The Product Display Information Differentiation Inventory Control Appeal Packaging and Labeling ©2007 Prentice Hall

  18. Selecting Products Product Line Product Mix • Line filling • Line extension • Brand extension • Line stretching • Width • Length • Depth • Risks and rewards ©2007 Prentice Hall

  19. Product Expansion Strategies Family Branding Brand Extension International ©2007 Prentice Hall

  20. Pricing Strategies Marketing Objectives Government Regulations Quality Perceptions Customer Demand ©2007 Prentice Hall

  21. Cost-Based Pricing • Break even analysis • Variable costs • Fixed costs • Break even point Insert top graph from exhibit 10.7 ©2007 Prentice Hall

  22. Other Pricing Strategies Price-Based Penetration Optimal Loss-Leader Skim Auction ©2007 Prentice Hall

  23. Price Adjustment Strategies Price Discounts Bundling Dynamic ©2007 Prentice Hall

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