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Posted: March 7th, 2024

identify truly weak products and phase them out with minimal impact on company profits,

identify truly weak products and phase them out with minimal impact on company profits,

P&G's impressive portfolio includes some of the strongest brand names in the world. Additionally, P&G must study its consumers, use long-term perspectives, employ product innovation and quality strategies to remain ahead of their competitors. In no more than a single page, research and discuss the challenges and risks associated with being the market leader in so many categories?

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CHAPTER NOTES BELOW:

• Chapter Notes

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Chapter 12 - COMPETITIVE DYNAMICS

Growing the core or seeking organic growth-focusing on opportunities with existing products and markets-is often a prudent way to increase sales and profits. A market leader has the largest market share in the relevant product market. To remain dominant, it looks to expand total demand and protect and perhaps increase its current share.

The aim of defensive strategy is to reduce the probability of attack, divert attacks to less threatened areas, and lessen their intensity. A leader would like to do anything it legally and ethically can to reduce competitors' ability to launch a new product, secure distribution, and gain consumer awareness, trial, and repeat.

A market challenger attacks the market leader and other competitors in an aggressive bid for more market share. There are five types of general attack and specific attack strategies. A market follower is a runner-up firm willing to maintain its market share and not rock the boat. It can be a cloner, imitator, or adapter. A market nicher serves small market segments ignored by larger firms. The key is specialization, which can command a premium price in the process. Companies should maintain a good balance of consumer and competitor monitoring and not overly focus on competitors. Technologies, product forms, and brands exhibit life cycles with distinct stages, usually introduction, growth, maturity, and decline. Most products today are in the maturity stage.

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The introduction stage is marked by slow growth and minimal profits. If successful, the product enters a growth stage marked by rapid sales growth and increasing profits. In the maturity stage, sales growth slows and profits stabilize. Finally, the product enters a decline stage. The company's task is to identify truly weak products and phase them out with minimal impact on company profits, employees, and customers. Like products, markets evolve through stages: emergence, growth, maturity, and decline. In a slow-growth economy, marketers must explore the upside of increasing investments, get closer to customers, review budget allocations, put forth the most compelling value proposition, and fine-tune brand and product offerings.

• Chapter Notes

Chapter - SETTING PRODUCT STRATEGY

Product is the first and most important element of the marketing mix. Product strategy calls for making coordinated decisions on product mixes, product lines, brands, and packaging and labeling. In planning its market offering, the marketer needs to think through the five levels of the product: the core benefit, the basic product, the expected product, the augmented product, and the potential product, which encompasses all the augmentations and transformations the product might ultimately undergo. Products can be nondurable goods, durable goods, or services. In the consumer-goods category are convenience goods (staples, impulse goods, emergency goods), shopping goods (homogeneous and heterogeneous), specialty goods, and unsought goods. The industrial-goods category has three subcategories: materials and parts (raw materials and manufactured materials and parts), capital items (installations and equipment), and supplies and business services (operating supplies, maintenance and repair items, maintenance and repair services, and business advisory services).

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Brands can be differentiated on the basis of product form, features, performance, conformance, durability, reliability, repairability, style, customization, and design, as well as such service dimensions as ordering ease, delivery, installation, customer training, customer consulting, and maintenance and repair. Design is the totality of features that affect how a product looks, feels, and functions. A well-designed product offers functional and aesthetic benefits to consumers and can be an important source of differentiation. Luxury brands command price premiums and often have a strong lifestyle component. They can require some special considerations in how they are sold. Products and their packaging must be designed to reduce adverse environmental impact as much as possible.

Most companies sell more than one product. A product mix can be classified according to width, length, depth, and consistency. These four dimensions are the tools for developing the company's marketing strategy and deciding which product lines to grow, maintain, harvest, and divest. To analyze a product line and decide how many resources to invest in it, product line managers need to look at sales and profits and market profile. A company can change the product component of its marketing mix by lengthening its product via line stretching (down-market, up-market, or both) or line filling, by modernizing its products, by featuring certain products, and by pruning its products to eliminate the least profitable. Brands are often sold or marketed jointly with other brands. Ingredient brands and co-brands can add value, assuming they have equity and are perceived as fitting appropriately. Physical products must be packaged and labeled. Well-designed packages can create convenience value for customers and promotional value for producers. Warranties and guarantees can offer further assurance to consumers.

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