product

• What is a product?

  A product is any good or service offered for sale to customers.
• Why is a jar of coffee considered more than just a jar of coffee?

  It represents a gateway to a more exotic life and social interactions.
• What are some reasons consumers purchase products beyond their functional use?

  Consumers may purchase products to show personal style or demonstrate wealth.
• What is a product portfolio?

  • The mix of products a business produces and sells.
  • It spreads fixed costs.
  • Allows for greater economies of scale.
  • Targets wider markets.
  • Reduces risk and smoothes out overall sales.
  • Creates opportunities for growth.
• What is product breadth?

  Product breadth is the number of product lines a business produces or retails.
• What is product depth?

  Product depth is the number of product varieties within each product line.
• How does having product depth benefit a business?

  It increases the number of repeat buyers and allows targeting of different market niches.
• What are some definitions of a brand?

  • A name given to a product to differentiate it.
  • A product consumers rely on for quality, value, and service.
  • A distinctive identity for a product.
  • A name, term, sign, symbol, or design identifying a seller's products.
  • A product identified easily by consumers with value and properties.
• Why is branding important for businesses?

  Branding helps establish a product's identity, making it desirable and predictable in sales.
• What are some advantages of using branding?

  Advantages include increased consumer loyalty and separation from competitors.
• What are some disadvantages of branding?

  Disadvantages include high advertising costs and potential loss of brand value affecting other products.
• What is a unique selling point (USP)?

  A USP is a feature or features that separate a product or service from the competition.
• How did Dyson establish its USP in the vacuum cleaner market?

  Dyson established its USP with its bagless system and distinctive design.
• What is product differentiation?

  • Making products different from the competition.
  • Can be achieved through:
  • Methods of promotion.
  • Unique packaging.
  • Distinctive form.
  • Provision of add-ons.
  • Emphasizing quality and reliability.
• Why is product differentiation important for businesses?

  It helps create customer loyalty and gives more control over pricing strategies.
• What are the stages of the product life cycle?

  1. Introduction

  2. Growth

  3. Maturity

  4. Saturation

  5. Decline
• What happens during the introduction stage of the product life cycle?

  The product is new, few consumers know of it, and profits are often low.
• What characterizes the growth stage of the product life cycle?

  The product becomes more widely known, and advertising aims to strengthen the brand.
• What occurs during the maturity stage of the product life cycle?

  Sales peak, competition increases, and advertising is used to firm up the product's image.
• What is the saturation stage in the product life cycle?

  Very few new customers are gained, and the market for the product is full.
• What happens during the decline stage of the product life cycle?

  Sales fall fast, and the product range may be reduced to focus on core products.
• What is the 'Straw on Fire' life cycle?

  • A product quickly moves through all stages of the life cycle.
  • Introduction is short, and market saturation may be reached in months.
  • Sales can become incredibly high during this time.
• How can the product life cycle be represented graphically?

  It can be plotted with sales and profits over time, showing changes through each stage.
• What happens to sales during the decline stage of the product life cycle?

  Sales start to fall.
• What are the stages of the product life cycle?

  • Introduction
  • Growth
  • Maturity
  • Saturation
  • Decline
• How can profits be plotted against a product's life cycle?

  Profits initially show losses due to high research and development and advertising costs, then increase through growth and maturity.
• What is a typical trend in profitability over the product life cycle?

  Initially, losses occur, followed by profits during growth and maturity, then a decline in profits.
• What is the 'Straw on Fire' life cycle?

  A life cycle where the product quickly moves through all stages, reaching market saturation in a matter of months.
• What are some examples of products with a 'Straw on Fire' life cycle?

  Furbies, Cabbage Patch dolls, hula hoops, yo-yos, loom bands.
• What does the 'Extended' product life cycle indicate?

  Some products remain in the marketplace for a long time, often avoiding decline.
• What are extension strategies?

  Strategies used to extend the life cycle of a product.
• What are some examples of extension strategies?

  • Repositioning the product in the marketplace
  • Relaunching the product for a different segment
  • Using the 'now with' policy
• How did Lucozade change its market position through extension strategies?

  It was repositioned from a drink for unwell children to a sports drink.
• What is the Boston Matrix?

  A tool for analyzing a business's products by categorizing them based on market share and market growth.
• What are the four categories in the Boston Matrix?

  • Cash cows
  • Stars
  • Question marks
  • Dogs
• What characterizes cash cows in the Boston Matrix?

  High market share with slow market growth, leading to high profitability and low advertising expenditure.
• Give an example of a cash cow product.

  Ford Focus, Kellogg’s Corn Flakes, or Cadbury’s Dairy Milk.
• What defines stars in the Boston Matrix?

  High market share in a fast-growing market, with high revenue and high costs.
• What is a classic example of a product that transitioned from a star to a cash cow?

  The Apple iPad.
• What are question marks in the Boston Matrix?

  Products with low market share in a fast-growing market.