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Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall,7-,*,CHAPTER,7,Product-Selling Strategies thatAdd Value,Learning Objectives,Describe positioning as a product-selling strategy,Explain the cluster of satisfactions concept,Discuss product-positioning options,Explain how to sell your product with a price strategy,Explain how to sell your product with a value-added strategy,7-,2,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall,7-,2,Positioning and Differentiation,Positioning involves:,Those decisions and activities intended to create and maintain a certain concept of the firms product in the customers mind,Differentiation refers to:,Your ability to separate yourself and your product from that of your competitors,It is the key to building and maintaining a competitive advantage,7-,3,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-3,Creating a Value Proposition,The set of benefits and values the company promises to deliver to customers to satisfy their needs,A well-informed customer will usually choose the product that offers the most value,7-,4,7-,4,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-4,Porsche Value Proposition,7-,5,See the Website,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-5,The Cluster of Satisfactions Concept,Products are problem-solving tools,People buy products if they fulfill a problem-solving need,Todays better educated and more demanding customers are seeking a,cluster of satisfactions,7-,6,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-6,Product-Selling Model,7-,7,FIGURE,7.1,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-7,Product-Positioning Options,Applies to both new and existing products,May be necessary to reposition products several times,Salespeople have an important and expanding role in differentiating products,Direct and personalized form of communication must be used,Mass advertising often fails to position a complex product,7-,8,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-8,Product-Positioning Options,Position new versus established products,Position with price strategies,Position with value added,7-,9,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-9,Competitive Analysis,Value-added product-selling strategy is enhanced when based on a comprehensive analysis of the competitive situation including:,The product,Its attributes,The benefits it offers,Table 7.1, on the next slide, provides a template for competitive product analysis,7-,10,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-10,Competitive Analysis Worksheet,7-,11,TABLE,7.1,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-11,Product Life Cycle Stages,7-,12,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-12,Selling New versusMature Products,Nature and extent of each stage in product life cycle determined by:,Products perceived advantage over available substitutes,Products benefits and importance of needs met by product,Full spectrum of competitive activity,Changes in technology, fashion, and/or demographics,7-,13,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-13,Product-Selling Strategiesfor Positioning,7-,14,FIGURE,7.2,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-14,New and Emerging Products:IntraLinks,Provides financial services industry with secure transmission of highly confidential information across the Internet,First sale was to J.P. Morgan for $50,000,Value proposition focused on:,Faster, more secure document transfer,Translated into improved customer service and cost savings,7-,15,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-15,IntraLinks,7-,16,See the Website,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-16,Mature and Established Products:,New York Life,150-year-old insurance company,Product portfolio recently expanded,When competing products enter the market, agents adopt new strategies,Copies products offered by competitors,Objective is to create in customers mind that it is a solid, strong, and solvent company,7-,17,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-17,New York Life Insurance,7-,18,See the Website,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-18,Selling Products witha Price Strategy,Pricing decisions must be made at each stage of the life cycle,Setting price can be a complex process,First step is to determine pricing objectives:,Some firms set prices to maximize profits,Others set a market share objective,Pricing strategies reflect a products position in the marketplace,7-,19,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-19,Transactional Selling Tactics that Emphasize Low Price,Quantity discount: lower price for high quantity or dollar amount,Seasonal discount: price adjusted by time of year,Promotional allowance: price linked to special promotion or advertising campaign,Trade/functional discounts: given to wholesalers for special services,7-,20,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-20,Consequences of Low Price Tactics,High/low involvement buyers?,High emotional involvement with brand,Low-involvement buyers focus on price,Importance of quality?,Role of price-quality relationship in sale,Importance of service?,Many buyers, particularly business-to-business, rank service above absolute price,7-,21,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-21,E-commerce and Price,Transaction orientation: online sales persons mostly transaction oriented, little value added,Buyers often well informed: online buyers visit a number of websites,Adding value: again, adding value is very important,7-,22,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-22,Value-Added Selling,Progressive marketers add value with intangibles,Increased service and courtesy,Prompt deliveries, more innovations,Value-added approaches yield unique niche and competitive edge,7-,23,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-23,The Total Product Concept,7-,24,FIGURE,7.3,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-24,Four Product Dimensions:,Generic Product,Generic product: basic product you are selling, describes product category (such as hotels, MP3 players, or insurance),Example: Every,Ritz-Carlton,hotel offers guest rooms, meeting rooms, and other basic hotel services.,7-,25,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-25,Four Product Dimensions:,Expected Product,Expected product: everything that meets the customers minimal expectations beyond generic product,Example: Every,Ritz-Carlton,offers not only guest rooms, but the rooms are upscale and luxurious.,7-,26,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-26,Four Product Dimensions:,Value-Added Product,Value-added product: salesperson offers customers more than they expect,Example: Every,Ritz-Carlton,recalls your newspaper preference, wake-up time, and that you require wireless Internet access.,7-,27,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-27,Four Product Dimensions:,Potential Product,Potential product: what remains to be done, what is possible, anticipating customers future needs,Example: Every,Ritz-Carlton,plans to offer complete services for business meetings.,7-,28,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-28,Ritz-Carlton,7-,29,See the Website,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-29,Value Creation Investments for . .,.,Transactional buyers,Involves emphasis on eliminating costs, avoiding delays,Consultative buyers,Involves custom-tailored solutions to deliver more real benefits,Strategic alliance buyers,Requires leveraging the full assets of the company; investments go well beyond the sales force,7-,30,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-30,Key Concept Discussion Questions,Describe positioning as a product-selling strategy,Discuss product-positioning options,Explain the cluster of satisfactions concept,7-,31,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-31,Key Concept Discussion Questions,Explain how to sell your product with a price strategy,Explain how to sell your product with a value-added strategy,7-,32,Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 7-32,7-,33,All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.,Copyright 2010 Pearson Education, Inc.,Publishing as Prentice Hall,7-33,
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