NEW PRODUCT PLANNING

1
NEW PRODUCT PLANNING

• Input of channel member
• Make acceptable to channel member
• Fit channel members assortment
• Special education and training
• Special problems

2
PRODUCT LIFE CYCLE(and Channel Management)

• PLC will vary according to
• How general the product is
• The degree of competition
• The regulatory environment, etc.
• The marketing channel strategy also varies with
  PLC
• The number of intermediaries used
• The degree of channel integration
• The type of promotional strategy used

3
INTENSITY OF DISTRIBUTION (AND PLC)

• Introduction selective distribution
• Growth Phase distribution is broadened
• Key task place product in those outlets that are
  patronized by the customer
• Maturity Phase maintaining the intensity of
  distribution
• Decline Phase Drop unprofitable dealers, reduce
  dealer support programs, and heavy trade discounts

4
VERTICAL INTEGRATION(and PLC)

• INTRODUCTION lack economies of scale
• May not vertically integrate
• Some times may be forced to
• GROWTH economies of scale exist
• Vertical integration becomes attractive
• MATURITY
• May be forced to integrate to acquire sources of
  supply, distribution outlets, and to gain control
• DECLINE excess capacity may sell off some
  outlets/drop services

5
STRATEGIC PRODUCT MANAGEMENT

• PRODUCT DIFFERENTIATION
• Channel members who fit products image
• Right kind of support and assistance
• PRODUCT POSITIONING
• Where product is displayed
• Merchandise presentation and display
• Incentives to generate retailer support
• PRODUCT LINE EXPANSION/CONTRACTION
• Incorporate channel member views
• Explain rationale
• Provide advance notice

6
STRATEGIC PRODUCT MANAGEMENT (continued)

• TRADING UP AND TRADING DOWN
• Need adequate coverage
• Need channel member confidence
• PRODUCT BRAND STRATEGY
• Possibility of competition between manufacturer
  and channel member
• Delineate possible scenarios in advance
• PRODUCT SERVICE STRATEGY
• Need channel support
• Importance of service must be made clear