9-1. 9-2 product-mix strategies chapter 9 mcgraw-hill/irwin copyright © 2004 by the mcgraw-hill...

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Page 1: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-1

Page 2: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-2

Product-Mix Strategies

Chapter 9Chapter 9Chapter 9Chapter 9

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

Page 3: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-3

Chapter GoalsChapter GoalsChapter GoalsChapter Goals

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

• Difference between product mix and product line• Product-mix strategies - positioning, expansion,

alteration, contraction• Trading up and trading down• Managing products throughout a life cycle• Planned obsolescence• Style and fashion• Fashion-adoption process

Page 4: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-4

Product Mix and Product LineProduct Mix and Product Line

PRODUCT MIXPRODUCT MIXThe set of all products offered The set of all products offered

for sale by a companyfor sale by a company

PRODUCT MIXPRODUCT MIXThe set of all products offered The set of all products offered

for sale by a companyfor sale by a company

PRODUCT LINEPRODUCT LINEA broad group of A broad group of

products for similar usesproducts for similar usesand with similar characteristicsand with similar characteristics

PRODUCT LINEPRODUCT LINEA broad group of A broad group of

products for similar usesproducts for similar usesand with similar characteristicsand with similar characteristics

Page 5: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-5

BREADTH The number of product lines carried

Product MixProduct Mix

DEPTH

Varietyof

sizes, colors,

models within

a product

line

PRODUCT MIXPRODUCT MIXPRODUCT MIXPRODUCT MIX

Page 6: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-6

Product Mix- Breadth and DepthProduct Mix- Breadth and Depth

Page 7: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-7

Positioning the ProductPositioning the Product

COMPETITORCOMPETITORCOMPETITORCOMPETITOR

High price/high qualityor

low price

High price/high qualityor

low price

DifferentialadvantageDifferentialadvantage

Associated with attractive attribute

Associated with attractive attribute

PRODUCT CLASSPRODUCT CLASS OR ATTRIBUTEOR ATTRIBUTEPRODUCT CLASSPRODUCT CLASS OR ATTRIBUTEOR ATTRIBUTE

PRICE PRICE AND QUALITYAND QUALITY

PRICE PRICE AND QUALITYAND QUALITY

Page 8: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-8

Product-Mix StrategiesProduct-Mix Strategies

Alteration of Alteration of existing productsexisting products

Alteration of Alteration of existing productsexisting products

ContractionContractionContractionContraction

Trading Up andTrading Up andTrading DownTrading Down

Trading Up andTrading Up andTrading DownTrading Down

ExpansionExpansionExpansionExpansion

Page 9: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-9

Product Life CycleProduct Life Cycle

Page 10: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-10

Product Life-Cycle StagesProduct Life-Cycle Stages

Page 11: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-11

Length of Product Life-CycleLength of Product Life-Cycle

Product life-cycle variations

Page 12: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-12

Life-Cycle ManagementLife-Cycle Management

Entry Strategies

Managingon

the Rise

Survivingthe

Decline

GrowthGrowthIntroductionIntroduction MaturityMaturity DeclineDecline

Managingduring

Maturity

Page 13: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-13

Planned ObsolescencePlanned Obsolescence

TechnologicalObsolescenceTechnologicalObsolescence

StyleObsolescence

StyleObsolescence

Page 14: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-14

Fashion Adoption ProcessFashion Adoption Process

Page 15: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-15

Key Terms and ConceptsKey Terms and ConceptsKey Terms and ConceptsKey Terms and Concepts

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

• Product mix

• Breadth

• Depth

• Product line

• Product-mix expansion

• Line extension

• Mix extension

• Product alteration

• Product-mix contraction

• Trading-up

• Trading down

• Product life cycle

• Introduction stage

• Growth stage

• Maturity stage

• Decline stage

• Fad

• First-mover advantage

• Product abandonment

• Planned obsolescence

Page 16: 9-1. 9-2 Product-Mix Strategies Chapter 9 McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved

9-16

Key Terms and ConceptsKey Terms and ConceptsKey Terms and ConceptsKey Terms and Concepts

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

• Technological obsolescence

• Style obsolescence

• Style

• Fashion

• Fashion-adoption process

• Fashion cycle

• Trickle-down theory

• Trickle-across theory

• Trickle-up theory