Marketing II Session 4 24 03 2015

Marketing II / Session 4 24. 03. 2015 Martin Samek martin. samek@lbs. ac. at

Product (Life Cycle) Lauder Business School Marketing II/ Session 4 2

New Products v. Innovation v. What are the characteristics of an innovation? 3 Lauder Business School Marketing II / Session 4

New Products v. Innovation -New to the world products/services. -New to the market products/services. -Successful in the market. 4 Lauder Business School Marketing II / Session 4

New Products v. Innovation - Diffusion of Innovation How innovations/new products are adopted on the marketplace Identify an innovation in an industry of your interest! 5 Lauder Business School Marketing II / Session 4

New Products v. Innovation - Diffusion of Innovation 6 Lauder Business School Marketing II / Session 4

New Products v. Strategic Decisions 7 Lauder Business School Marketing II / Session 4

New Products v. Strategic Decisions - Market penetration Sell more of same products to current markets New ways to use the products, better pricing, better reward program, etc. -Product development Sell new or modified products to current markets Brand line extensions or new variations of existing products 8 Lauder Business School Marketing II / Session 4

Price Lauder Business School Marketing II/ Session 4 9

Price - is relative to competition and the economy - is a message about quality -is a signal regarding positioning and image of the brand - provides value for money/ cost benefit Easiest to change of the 4 Ps 10 Lauder Business School Marketing II / Session 4

Price The 3 Cs influencing pricing decisions -> Company’s cost -> Customers’ sense of product’s value -> Competition’s price 11 Lauder Business School Marketing II / Session 4

Pricing Strategies LOW PRICE: -> Nearly predatory -> Market penetration -> Loss leader -> Cost-plus 12 Lauder Business School Marketing II / Session 4

Pricing Strategies MEDIUM PRICE: -> Competitive -> Slightly below competition -> Slightly above competition 13 Lauder Business School Marketing II / Session 4

Pricing Strategies HIGH PRICE: -> Market Skimming -> Prestige or status pricing -> High because of real market difference 14 Lauder Business School Marketing II / Session 4