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MGTA02H3 (361)
Chapter 6

Chapter 6 summary notes

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University of Toronto Scarborough
Management (MGT)
Chris Bovaird

MGTA04 Chapter 6 WHAT ISAPRODUCT? - marketers must consider what consumers want in order to plan strategies effectively The Value Package - features: the qualities, both tangible and intangible, that a company builds into its products - to attract buyers, must also provide benet - value package: products marked as a bundle of value-adding attributes, including reasonable cost - in buying a product, consumers are also buying an image and reputation Classifying Goods and Services - one way to classify is to classify it according to expected buyers - 2 groups, buyers of consumer products and buyers of industrial products (hence dif. marketing approach) - consumer products (3 categories) - convenience goodsservices: relatively inexpensive consumer goods or services that are bought and used rapidly and regularly, causing consumers to spend little time looking for them or comparing their prices - shopping goodsservices: moderately expensive consumer goodsservices that are purchased infrequently, causing consumers to spend some time comparing their prices - specialty goodsservices: very expensive consumer goodsservices that are purchased rarely, causing consumers to spend a great deal of time locating the exact item desired - industrial products (2 categories) - expense items: relatively inexpensive industrial goods that are consumed rapidly and regularly - capital items: expensive, long-lasting industrial goods that are used in producing other goodsservices and have a long life The Product Mix -product mix: the group of products a company has available for sale - product line: a group of similar products intended for a similar group of buyers who will use them in a similar fashion - some companies will have multiplediversied product lines which helps the company grow and offset slow sales in another other product line. DEVELOPING NEW PRODUCTS - to expand or diversify product lines, rms must develop successful and introduce new products, and require constant renewal. The Time Frame of New Product Development - companies often face multi-year time horizons and high risks when developing new products - it takes ~50 new product ideas to generate 1 new product...which could also fail. (~910 new products will fail) bc of lack of space and customer demand. - speed or market: strategy of introducing new products to respond quickly to customer andor market changes (introduce new products before competitors) The Seven-Step Developmental Process for goods 1 www.notesolution.com
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