Class II

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Class II

• Value Quadrant

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Integrating Style and Technology

• Style refers to sensory elements that communicate
  the desired aesthetic and human factors of a
  product or service.
• Must respond to consumers expectations
• Identity of the product
• Measures how well a product identifies with
  lifestyle of people at the core of the market
• Attributes include look feel and sound of
  products
• Ergonomics (comfort, ease of use and safety) must
  complement aesthetics

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Technology

• Refers to the core function that drives the
  product, the interaction of components that are
  required to use the product, and the methods and
  materials used to produce the product
• Core functionality can be mechanical, electrical,
  electromechanical, chemical, digital, or any
  combination
• Interaction with core technology can be just
  pressing a button or complex set of physical
  buttons and/or screen/voice commands
• Materials must be appropriate to the projected
  cost, fulfill the requirements of internal
  components and complement the style requirements

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Positioning Map

• Shows how different products in the same category
  can be represented in a matrix with Style and
  Technology as the two axes

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Positioning Map-Value quadrant

• Shows how different products in the same category
  can be represented in a matrix with Style and
  Technology as the two axes, and value as third
  axes. Value existing only in the upper right
  quadrant

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Valuable products

• Growing sophistication of consumer awareness,
  hence products that lack integration of style and
  technology are not perceived as valuable
• Value nowadays is more dependent on lifestyle
  compatibility than on prices
• Higher compatibility with lifestyle, role played
  by prices becomes less important

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Style vs. Technology Brief History

• Late 19th and most of 20th century products were
  driven by technological innovations
• 1850-1950, industrialization led to focus on mass
  production of items at cheaper rate and not on
  aesthetics or ease of use
• During 19th century, agrarian lifestyle and craft
  manufacture replaced by mass produced products
  and industrial/service economy
• Major milestones
• Morse Telegraph
• Continental railroad
• Electrical distribution
• Eastmans camera and celluloid
• Fords assembly line
• Wright Brothers development of powered flight

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Style vs. Technology Brief History

• SET factors affecting 19th and early 20th century
• Time (speed of doing things)
• Disposable income
• Increased literacy
• Social reforms rapid advances in science and
  technology

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Growth of Consumer Culture

• Reduction in work hours, increased wages, free
  time and disposable income created need for more
  products, services and forms of entertainment
• (Late 19th and early 20th)Technology-based
  products were common, and advantages these
  products provided in speed, power and
  communication far out weighed the danger and
  visual clutter
• Progress and change were more important than
  refinement and human factors

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Introduction of Style to Mass Productions

• Occurred in US between late to mid 1920s
• Examples
• Introduction of market segmentation and styling
  under Harley Earl (GM)
• 1930s trains redesigned as aviation posed a
  threat
• Greyhound bus company overhauled their fleet in
  1940s
• Improvement in style and functioning of
  refrigerators, washing machines as well as vacuum
  cleaners
• New design for telephone for ATT

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Post WWII , Growth of Middle Class and Height of
Mass Marketing

• US involvement in war led to American companies
  achieving maximum manufacturing capacity and
  fostered development of new technology
• Computer
• Jet Engine
• Nuclear bomb
• Other reasons return of career and family
  oriented GIs. And subsequent Baby Boom
• Mass production by retooling, low gas prices
  epitomized integration of style and technology
• 1950s and early 60s marked by brand identity
  programs that merged state-of-the-art products
  with emerging international style. Graphic
  identity, products, work environments and
  architecture modified by external consultants.
• Boom lasted until oil embargo of 1970

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Rise of Consumer Awareness and the End of Mass
marketing

• 1970s Consumer awareness evolved with
  concentration on product safety and quality
• Variety of consumer protection arose ranging from
  publications( Consumer Reports), consumer
  protection groups to legislation (Americans with
  disabilities act)
• New awareness led to niche marketing
• Civil and womens right and environmentalism led
  to new types of consumers with particular demand
  and new range of interests
• Example Trends
• Apple Mac beats IBM with user centered design
• Oil embargo allows Japanese cars to capture US
  markets
• Japanese companies overshadow Xerox in copier
  machines with sleeker designs

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Era of Customer Value, Mass Customization, and
Global Economy

• Global competition among companies in diverse and
  demanding markets
• Consumers are not predictable and do not follow
  simple consistent patterns of purchasing
• Access to cultural patterns of change is higher
  than ever (Web, magazines, newspapers, radio and
  television)
• Consumer wants center on products that are well
  made, safe and match their lifestyle

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Lower Left Low Use of Style and Technology

• Generic products
• Designed with established technologies and
  minimal styling
• Sell to consumers who do not seek out value but
  driven by low price, functionalism at low cost
• Products establish baseline and fail to respond
  to change
• Products made as cheaply as possible and
  distributed as widely as possible

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Lower Right Low Use of Style, High Use of
Technology

• Products driven by technology
• Maximize features but ignore lifestyle effects
  and ergonomics
• Often first of their type and offer technological
  advantage
• Example VCR Lots of capabilities, horrendous
  interface, undesirable neutral look

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Upper Left High Use of Style, Low Use of
Technology

• Products driven only by style
• Excludes use of human factors and core technology
  features
• Examples Alessi products from Italy, Low cost
  version for Target by Graves and products by
  Philippe Stark
• Cosmetic approach fails when consumers realize
  products do not perform as anticipated

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Upper Right High Use of Style and Technology

• Products that integrate style and technology and
  add value to ensure success
• Lifestyle impact, features and ergonomics blend
  to enable personal expression, cutting-edge
  capabilities and usability
• Differentiates products from competition and
  defines state-of-the-art for their market
• Though they cost more consumers are willing to
  pay the premium

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Case Studies- OXO GoodGripsPositioning Map
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Motorola Talkabout
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Crown Wave
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Starbucks
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Revolutionary vs. Evolutionary Product development

• Revolutionary products establish new market or
  solution within a market
• Evolutionary products typically begin in Upper
  right and remain there as new useful, usable or
  desirable innovations. Require injections of new
  value to maintain the consumers connection to
  the product
• Revolutionary products enter Upper right and
  remain there only by becoming evolutionary
  products that change with the SET factors

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Example
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Sheer Cliff of Value

• Strategic commitment required from the company to
  user-centered iNPD (integrated New Product
  Development ) process
• Value comes into play only in the upper right
  quadrant
• Upper right maximizes needs a, wants and desires
  of consumers without sacrificing usefulness,
  usability or desirability
• Abrupt change in value hence the term cliff

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Shift in Concept of Value in Products and Services

• During mass marketing, value seen as services a
  product provided for its cost
• Actual value is lifestyle drive, and is the
  relative worth and utility of a product
• Product is valuable only if it is useful, usable
  and desirable
• Cost of making highly valued product increases
  less rapidly than the amount people will pay for
  it.

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Increased profit in Upper right

• The cost to make a highly valued product
  increases less rapidly than the amount consumers
  ready to pay for it
• In spite of lower profit margins, profits are
  increased due to higher sales and resulting
  profit per item
• Establishing brand and thus customer loyalty.
• Charging less than the competition due to an
  effective process of integrating design and
  engineering

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Cost vs. Value

• Consumers expect high degree of quality in the
  products they buy
• Products that support experiences succeed
• These experiences are new source of values
• Each progression leads to higher pricing of the
  product
• Old adage form follows function replaced by form
  and function fulfilling fantasy
• Value driven products more competitive over cost
  driven products

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Cost vs. Value

• People pay for value beyond what they pay for
  commodities
• Key is to identify the limit and what a given
  market looks like for a product

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Value Opportunities

• Value can be broken down into specific attributes
• Set of opportunity classes that add to a
  products value
• Emotion
• Aesthetics
• Identity
• Ergonomics
• Impact
• Core technology
• Quality

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Emotion

• Sense of adventure the product promotes
  excitement and exploration
• Feel of independence the product provides a
  sense of freedom from constraints
• Sense of security the product provides a feeling
  of safety and security
• Sensuality the product provides a luxurious
  experience
• Confidence the product supports the users self
  assurance and promotes his or her motivation to
  use the product
• Power the product promotes authority, control
  and a feeling of supremacy

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Aesthetics

• Visual The visual form must relate shape, color
  and texture to the context of the product and the
  target market
• Tactile The physical interaction of the product,
  primarily focusing on the hand but also including
  any other physical contact between the product
  and the user, must enhance the product experience
• Auditory The product must only emit the
  appropriate sounds and eliminate undesired sounds
• Olfactory The product must have an agreeable
  smell, providing appropriate aromas and
  eliminating unpleasant odors
• Gustatory Products that are designed to be
  eaten, used as a utensil or otherwise placed in
  the mouth must have an optimum flavor or no
  flavor at all

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Product identity

• Personality The two main issues in a product
  personality are
• Ability of a product to fit among yet
  differentiate itself from its direct competition
• Connection that a product has to the rest of the
  products produced by that company
• Point in time In order for a product to be
  successful, it has to capture a point in time and
  express it in a clear powerful way. Point in time
  is a tricky combination of features and
  aesthetics
• Sense of place Products must be designed to fit
  into the context of use

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Impact

• Social A product can have a variety of effects
  on the lifestyle of a target group, from
  improving the social well-being of the group to
  creating a new social setting
• Environmental The effect of products on the
  environment is becoming and important issue in
  terms of consumer value. Design fore the
  environment or green design focuses on minimizing
  the negative effects on the environment due to
  manufacturing, resource use of the product during
  operation and recycling

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Ergonomics

• Ease of Use A product must be easy to use (
  cognitive and physical). Product should function
  within the natural motion of the human body. The
  ergonomics of the size and shape of components
  that a person shall interact with should be
  logically organized and easy to identify, reach,
  grasp, and manipulate
• Safety A product must be safe to use. Moving
  parts should be covered, sharp corners eliminated
  and internal components shielded from users
• Comfort Along with ease of use and safety, a
  product should be comfortable to use and not
  create undue physical or metal stress during use.

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Core Technology

• Enabling Core technology must be appropriately
  advanced to provide sufficient features. May be
  emerging high technology or well manufactured
  traditional technology, as long as it meets
  consumer expectations in performance
• Reliable Consumers expect technology in products
  to work consistently and at high level of
  performance over time

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Quality

• Craftsmanship fit and finish The product should
  be made with sufficient tolerances to meet
  performance expectations
• Durability- performance over time The
  craftsmanship must hold up over the expected life
  of the product

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Value Opportunity Charts and Analysis
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VOA -GoodGrips
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VOA Talkabout
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VOA Crown Wave
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VOA Starbucks
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