Employ product-mix strategies to meet customer expectations: Using Customer Input to Design Winning Products Created by Alison Garrett, Debbie Pardue,

Entrepreneurship I - 2.07

Employ product-mix strategies to meet customer expectations:Using Customer Input to Design Winning Products

Created by Alison Garrett, Debbie Pardue, Cara Midyette & Terry Deese

The assortment of goods and services that a business offers in order to meet its market’s needs and its company’s goals.◦ Includes product lines & individual products

What is a Product mix?

Marketing Concepts

Market: The group of potential customers who have similar needs/wants, sufficient buying power, and the willingness to give up a portion of that buying power in order to buy your product/service.

Marketing Concepts

Target Marketing: Identifying market segments with the greatest potential for sales and focusing marketing decisions on satisfying the individuals that make up these segments.

Marketing Concepts

Target Market: The group or groups of potential customers identified as most likely to patronize the business and buy its products. Sometimes, a business can take an existing good or service and change it so it will fulfill the needs of another target market. Example: some products can be altered to accommodate

people with certain disabilities

Customers buy your products because of the value that it can give them. ◦ They are not buying your product per se, but

what your product can give them. ◦ They are buying the satisfaction of a want.

Why Do Cutomers Buy? Customers have different motivations

when they buy. ◦ Some consider price as the main deciding

factor, often looking for the lowest available price.

◦ Others try to find ways to reduce cost and at the same time enhance revenue and improve quality.

Customers will not buy a product if they don’t foresee receiving a positive benefit from it.◦ A User Experience is the feeling that a customer

gets when using a product. ◦ The User Experience is important because it often

colours the user’s perception of the product far more than the technical features of the product do.

Businesses must find out what features they need to add to a product to produce the benefit a customer is looking for.

Giving the Customer What They Want

The iPhone is not the most technologically advanced phone on the market (remember those reception issues?), but it provides the type of “cool” user experience that its target user values.

That “cool” factor, which has generated tremendous success for the iPhone, didn’t happen by accident – it was designed into the product.

Example of Giving the Customer What They Want

To compete in the marketplace, a business must develop or find products that will fulfill its customers’ changing needs and wants.

Obtaining customer feedback is a good way to evaluate how a business is meeting its customers’ needs and what it needs to do to increase customer satisfaction.

It is important that you know what customers consider most valuable about your products or services.

Find Out What the Customer Wants

Have a marketing person call on customers with survey questions. ◦ Could have a person conducting market study groups or

hire an outside agency to capture company data. These options can be costly

How to Get Customer Input

snag

ajo

b.c

om

Document customer feedback. ◦ When a customer calls or emails your

company with positive or negative feedback, this information should be documented and stored in a database.

Once you have a list, ask them again if you are indeed delivering what they want.

How to Get Customer Input

Use two questions – ◦ what does the customer value with regards

to your products and services◦ how well do you provide that value

Use of face-to-face interviews. ◦ Arrange for a series of informal conversations

with typical individual members of your target user community.

◦ Don’t interview a group – you won’t get the same quality of input.

◦ Choose a comfortable setting to allow them to relax and share their thoughts without the distractions of their day-to-day responsibilities.

A feature is a physical characteristic or quality of a product.

What products have. ◦ For example, say you sell an accounting software. You can

say, “This accounting software has a reporting feature.” It is something the customer can touch, feel, smell,

see, or measure

What is a Product Feature?

It helps describe the product.

A feature answers the question, “What is it?”◦ Ex: color, style, size

Benefits — what features mean.

The personal satisfaction or advantage that a customer wants from a product.

It is how the feature helps a particular buyer

For customers, it answers the questions:◦ How will I benefit?◦ What’s in it for me?

What is a Product Benefit?

Prove to customers your product has features that benefit them

Customers buy benefits-not features Compare to competition Determine what each customer is looking for

in a good or service

Feature-benefit Selling

Nike plus

Salespeople should be able to explain these three types of benefits to customers:

◦Obvious or apparent benefits

◦Unique or exclusive benefits

◦Hidden benefits

Three types of benefits

Advantages that need little explanation by the salesperson.

The customer already knows the benefit◦ Ex: Water repellant rain coat◦ What is the obvious benefit?

Even if benefits are obvious, salespeople should still point them out and use them to prove the value of the product to customers

Obvious or apparent benefits

Advantages that are available only from your good, service or business.

Is a selling advantage over your competitors

Ex: a car that “parks” itself is a novelty ◦ Offers a huge benefit to customers that have

trouble parallel parking

Unique or exclusive benefits

Ford Focus

Advantages that cannot be seen or understood without the assistance of a salesperson

Ex: buying a pair of shoes◦ You can see the color and style◦ You can not see how comfortable they are until

persuaded to try them on Ex: purchasing a computer

◦ Warranties/24-hour helpline

Hidden benefits

Step One: Find your product’s features◦ Construction and materials:

What is the material? Who makes it? How is it made? What’s the difference between these two

items?◦ Appearance and style

Appearance is a dominant factor in many buying decisions

Customers consider color, line, and design in everything they buy – cars, clothes, accessories, appliances, furniture, etc.

Feature-benefit charts

Step one cont’◦ Unique or novel features

Having desirable features that your competitor does not have

◦ Durability How long a product will last and give dependable

service◦ Product uses

What the product will do and how it can be used◦ Service and warranty

Especially important when selling products such as appliances, electronics, and cars

Feature-benefit charts

Step two: Know where to get facts about product features◦ The product itself

Use the product and information provided◦ Customers

Testimonials◦ Manufacturer’s brochures and publications◦ Other sales personnel◦ Promotional materials

Product bulletins Catalogs/manuals

Feature-benefit charts

Step Three: create a feature-benefit chart◦ After you know what type of information you need

and where to obtain the facts about your products, prepare a feature-benefit chart List all the product’s features, beginning with the

ones that a customer or client will see first List the less-obvious or hidden features For each feature that you identified, ask, “what does

this mean for the customer?” Write each benefit beside its feature A feature can provide more than one benefit

Feature-benefit chart

Product Features (What are they?)

Benefits (What do they mean?)

Computer Variety of models You will be able to select different components to build a system that meets your specific needs

Monitor size Large monitors that come with these computers enable you to see the entire page. Gives a clear understanding of how the document looks

Memory These models can be loaded with sufficient memory so your computer can handle any program

Print capability Handle all your printing needs in your home or office

Sample feature-benefit chart