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MARKETING CHANNELS
Product Management Strategy
Berman Chapter 8
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Overview of Product
Management Strategy
• A. New Product Planning
• B. Product Life Cycle
• C. Reverse Channels
– recall and recycling
• D. Packaging
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A. New Product Planning
Process
• Sequence
– idea generation – product screening – concept testing – business analysis
– product development – test marketing
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“Channel Considerations”
New Product Plng
– other channel members
• wholesalers, retailers, facilitators
– new product sales forecast
– channel overlap
• new , existing
– test marketing
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• Justification
• Channel members
– generate new ideas
– evaluate new product concepts
– closer to market, customers, competitors – purchasing agents for customers
– essential for success
– unbiased response vs subordinates – parts,
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•Existing Channels / New Product Fit
Functional Fit
• ability to store, sell, repair and service
• channel overlap
• incremental costs, new products vs existing
• established customer relationships
• incremental quantities, coop opportunities
• single source suppliers
•reduce order costs
•compatibility problems
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B. Channel Mgnt and Product Life Cycle
• wholesaler/retailer by PLC stage
• different strategies at each stage
– training at introduction – reduced sales at decline
– service experience and product life
– boutique, specialty store, department store, discount store, direct marketing
• wholesaler/retailer control
– gatekeepers, change agents
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• Wholesaler Retailer Roles
– at introduction
• diffusers, gatekeepers, scouts, troops • pioneer brand, follower brands
• slotting allowances, pay-to-stay, failure fee
– at growth
• reevaluation and adjustment
• expansion of channel member responsibilities
– at maturity
• reevaluate coverage, increase enthusiasm • shelf space, private label strategies
• new market segments, extend stage
– at decline
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• Evaluation of The Product Life Cycle
– variance between categories, forms and brands – self fulfilling prophesy
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• C. Reverse Channels
• returned goods - credit, repair • product recall
• product recycling
– final consumer to manufacturer
• backhaul opportunity
– accumulate quantities vs sorting – combine categories vs separation
(grades, color, sizes)
– large quantities of manufacturers (customers) – unauthorized suppliers, customers, buyers
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• Product Recall
• measurement = completion rate
– cost reductions during recalls
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• Product recycling
– waste - postconsumer, comparable, preconsumer
– ways to promote - government, laws,financial incentives, disincentives, educational programs, – strategies to reduce waste, increase recycling
• design for ease of disposal • innovative packaging
• closed loop recycling
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• D. Packaging and Channels
– Contain and Protect Products – Promote Products
– Facilitate product storage, use and convenience – Facilitate recycling
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• E. Legal Aspects of Channel
Management
– exclusive dealing – tying arrangements – full line forcing
– reciprocity
– refusal to deal – private label
