Product And Innovation Strategies Introduction - Marketing Management

We have discussed the analysis that precedes and is essential to the development of marketing programmes designed to meet corporate and strategic marketing objectives. In this, and subsequent chapters, we consider strategic decisions concerned with planning and implementing elements of the marketing mix; namely product, price, place and promotion (the four Ps).

This chapter examines the wide ranging nature and scope of product and service strategies (the term product covers services like banking and insurance so when we refer to products, this includes services). Products convey to customers more about a company than any other marketing activity. Not only are they the source of revenue and profit, but new products are the most important element in the marketing mix that establishes success in the future. A product can be a piece of machinery with physical characteristics or a service with intrinsic characteristics like hairdressing. The common denominator between products and services, whether physical or intangible, is that they need to meet the needs and requirements of customers and provide satisfaction. Product decisions determine the upper limit to a company’s profit potential; the rest of the marketing mix determines the extent to which this potential is achieved. It is essential to manage a company’s product mix effectively in a competitive marketplace. Companies are under increasing pressure to continuously develop new products which are timely and respond to customer needs. Successful businesses are able to develop new products to meet changing needs in a dynamic marketplace and it is this aspect of product management that is particularly emphasized in this chapter.

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