Discussion for Marketing - Product

An offering is the sum total of what a company has to offer its customers. While this includes specific characteristics of the product offered (e.g. functionality, benefits, price, quality), it also includes other aspects such as customer service, maintenance and warranties.

New Product Development

Many corporations follow an established process for developing new offerings. This process is often illustrated in the shape of a funnel to represent the fact that many new product ideas enter the process (the larger opening of the funnel), but, after rigorous screening, testing, and vetting, only the best ideas develop into viable products that are launched into the marketplace (e.g. exiting the smaller end the funnel).

The Product Life Cycle

A newly launched product takes time to penetrate the market. As the product gains distribution and more customers adopt the product, sales increase and eventually peak. Depending on the product category, sales may eventually decline to a point at which the product is no longer viable. This process is illustrated by a concept called the Product Life Cycle, which includes phases for product introduction, growth, maturity, and decline.

Different marketing objectives apply at each stage of the product life cycle. Below is an example of how the marketing strategy may vary, depending upon where the product is in the product life cycle.

Product Life Cycle Phase	Possible Strategies
Introduction	Build awareness through increased frequency of communication.
Growth	Stem competitive threats through sales promotions and increased distribution.
Maturity	Reinvigorate the category by launching line extensions.
Decline	Reduce costs through increased productivity and targeted distribution.

Developing & Marketing Services

Services differ from products because they are not concrete offerings that can be touched or felt, but rather experiences or actions that add value to the customer. Although the nature of the offering is different, the same strategic planning and rigor must go into the marketing of services.

Additional Materials

For a simple overview of new product development, watch this video.

This video provides an example of how a company can assess the environmental impact of its products using the product life cycle model.