Product

R'tist @ Tourism

Online Mktg - Product

© Ramakrishna Kongalla, Assistant Professor

Indian Institute of Tourism & Travel Management(An Organization of Ministry of Tourism, Govt. of India)

Product• In marketing, a product is anything that can be offered to a market that

might satisfy a want or need.• In retailing, products are called merchandise.• In manufacturing, products are purchased as raw materials and sold as

finished goods. • Commodities are usually raw materials such as metals and agricultural

products, but a commodity can also be anything widely available in the open market.

• In project management, products are the formal definition of the project deliverables that make up or contribute to delivering the objectives of the project.

• In insurance, the policies are considered products offered for sale by the insurance company that created the contract.

• A related concept is subproduct, a secondary but useful result of a production process.

• Dangerous products, particularly physical ones, that cause injuries to consumers or bystanders may be subject to product liability.R'tist @ Tourism

R'tist @ Tourism

Product classification• A product can be classified as tangible or intangible. – A tangible product is a physical object that can be perceived by touch such as a

building, vehicle, gadget, or clothing. An intangible product is a product that can only be perceived indirectly such as an insurance policy.

– Intangible Data Products can further be classified into:

• Virtual Digital Goods ("VDG") that are virtually located on a computer OS and accessible to users as conventional file types, such as JPG and MP3 files, without requiring further application process or transformational work by programmers, and as such the use may be subject to licence and/or rights of digital transfer, and

• Real Digital Goods ("RDG") that may exist within the presentational elements of a data program independent of a conventional file type, commonly viewed as 3-D objects or a presentational item subject to user control or virtual transfer within the same visual media program platform.

– Open Source Code, GNU Linux, or even Android, may manipulate and/or convert base Virtual Digital Goods ("VDG") into process-oriented Real Digital Goods ("RDG"), as part of an application process or manufactured service that may be viewed on Personal Data Assistant ("PDA") or other hand-held tangible devices or OS computer.

R'tist @ Tourism

• By use– In its online product catalog, retailer Sears, Roebuck and

Company divides its products into "departments", then presents products to potential shoppers according to (1) function or (2) brand.

• By association– A product line is "a group of products that are closely related,

either because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges.“

– Many businesses offer a range of product lines which may be unique to a single organization or may be common across the business's industry.

– Within the insurance industry, product lines are indicated by the type of risk coverage, such as auto insurance, commercial insurance and life insurance

R'tist @ Tourism

• National and international product classifications– Various classification systems for products have been developed for economic statistical

purposes. The NAFTA signatories are working on a system that classifies products called NAPCS as a companion to North American Industry Classification System (NAICS).

• The Aspinwall Classification System classifies and rates products based on five variables:– Replacement rate (How frequently is the product repurchased?)– Gross margin (How much profit is obtained from each product?)– Buyer goal adjustment (How flexible are the buyers' purchasing habits with regard to this

product?)– Duration of product satisfaction (How long will the product produce benefits for the user?)– Duration of buyer search behavior (How long will consumers shop for the product?)

• The National Institute of Governmental Purchasing (NIGP) developed a commodity and services classification system for use by state and local governments, the NIGP Code.– The NIGP Code is used by 33 states within the United States as well as thousands of cities,

counties and political subdivisions.– The NIGP Code is a hierarchical schema consisting of a 3 digit class, 5 digit class-item, 7

digit class-item-group and an 11 digit class-item-group-detail.– Applications of the NIGP Code include vendor registration, inventory item identification,

contract item management, spend analysis and strategic sourcing.

R'tist @ Tourism

• Model• A manufacturer usually provides an identifier for each

particular type of product they make, known as a model, model variant, or model number. • For example, Dyson Ltd, a manufacturer of appliances

(mainly vacuum cleaners), requires customers to identify their model in the support section of the website.• Brand and model can be used together to identify

products in the market. The model number is not necessarily the same as the manufacturer part number (MPN).• A specific unit of a product is usually identified by a serial

number.

R'tist @ Tourism

Marketing Products Online• Reaching the point in your business’s development where you

have a ready to market product is a wonderful feeling. • The work you must do to bring just one product to the market

online is almost identical to the work that you must do to market your entire business online.

• In short bringing a product to market, online, will require you to create an online marketing plan around the product that you intend to sale.

• This plan should be founded upon– 1) what you know about your audience,– 2) what you know about your audience and – 3) your product’s USP.

• Those three items should serve to guide your decisions on items such as the type of website to create and the type of online promotional tactics to engage in.

R'tist @ Tourism

• 1 – Do Your Research– 1) who your audience is,– 2) what their needs and wants – 3) when they buy, – 4) how they decide on what and where to purchase – 5) where does your audience spend their time at online, – 6) what is their level of comfort with their current situation and etc.

• This information will come in handy when you want to do things such as decide which social media platforms to utilize or when you want to determine the type of voice to use in your messaging.

• A list of both long and short tail keywords that audience uses to land on website (you can find this with Google Analytics)

R'tist @ Tourism

• 2 – Set SMART Goals– SMART-• specific, • measurable, • attainable, • realistic, and • timetabled.

– there are two types of goals:• online-business goals and• marketing goals.

– business goals should address items such as sales, revenue, costs, and profitability. Since the type and degree of online marketing tactics will be influenced by budget one want to take financial position into consideration when putting business goals together.

– marketing goals should be designed so that product sales will allow you to meet company’s business goals. They should include metrics such as monthly website visits, page views, ad impressions, clicks, click trough rate, conversion rate, cost per conversion, average transaction value, and etc.

R'tist @ Tourism

• 3 – Develop Your Elevator Pitch

– An elevator pitch, which is also sometimes referred to as a unique selling point (USP), is a tool that is used to etch brand’s unique qualities into the mind of audience.

– In short its what separates one from his competitors and it is what let’s audience know how product will solve their problems.

– Elevator pitch makes up the thrust of your product’s messaging strategy.

– Elevator pitch should be incorporated into website, landing pages, and promotion tactics.

R'tist @ Tourism

• 4 – Finding an Online Home– The basic options that you have are:

– Squeeze Page. This type of site consists of a single page, usually with no navigation that begins with copy and leads into the crescendo-a product sales offer. It works best when you have one product and want the consumer to take one action-which is either a purchase and/or to make a request for information.

– Micro Site. A micro site is a miniature website that is typically built around one product; they often include several different types of commercial online content such as online videos, white papers, and etc. This type of website works well when selling expensive or complicated products.

– Website. This can be an ecommerce site, a blog, or a more standard website. This format works well when you have multiple products to sell. Often times marketers who utilize a complete website to market their products have several different landing pages-one for each product or family of products.

R'tist @ Tourism

• 5 – Online Promotion Plan– The online marketing tools that should be included in promotion plan will be based upon goals,

audience’s online habits and preferences, as well as company’s financial and time constraints. The most commonly used tools are:

• Organic SEO : Organic SEO is used to impact website’s position within the search engine results for relevant keywords.

– Pros: This strategy drives targeted traffic to site and has long-term benefits that often outlive efforts. Surfers place more trust in the natural results than they do in paid results.

– Cons: It takes time for the benefits of organic SEO to materialize. It can be extremely expensive.

• Paid Search Engine Marketing or SEM : SEM is used to drive targeted potential buyers to site via sponsored search engine results-think “Google AdWords”.

– Pros: This strategy can provide near immediate results. It also allows advertisers highly detailed analytics. Performance based pay structure-you pay only for clicks.

– Cons: Many a firm has lost their shirt doing PPC marketing. Campaigns can get expensive really quick and if you aren’t conducting testing you could easily get in over head.

• Affiliate Marketing: Affiliate marketing is where one pay affiliates a commission on the sales that they help to generate online.

– Pros: Highly cost effective way to bring targeted buyers to site. In addition to bringing sales affiliates also give back-links to site.

– Cons: sales are dependent upon the strength of affiliates. Although relative to SEO and PPC overall affiliate marketing costs are low the set up costs can be expensive.

R'tist @ Tourism

• Online PR: Online PR speaks to the methods that we use to influence the perception of online audience to product(s) or brand. This includes social media as well as the management of online newsroom and press releases.

– Pros: Relatively inexpensive to utilize. Since online pr often results in people sharing information with each other about products, this tool is very similar to a traditional referral.

– Cons: have little control of message as much of online pr as the consumer primarily controls or drives social media. Also have less control over the type of traffic that website will receive from online pr efforts-could get a high percentage of window shoppers from this type of marketing.

• Email Marketing: Email marketing is a form of marketing where the marketer uses emails as the communication medium to reach the consumer-directly.

– Pros: This can be used to complement PPC marketing and it can greatly enhance the experience of current customers. Relative to the other tools email marketing offers a very high ROI.

– Cons: can easily alienate customers if we aren’t careful. If you break the CAN-SPAM Act you could be fined up to 16,000 USD for a single violation.

• Blogging: can use a business blog to communicate with audience while building web presence.

– Pros: Very affordable. Easy way to establish brand online. – Cons: Can be highly time consuming. May take a long time to generate sales .

R'tist @ Tourism

Product Launch

• Long gone are the days when announcing a new product was simply a matter of putting together a news release, sending it off over the wire and counting on major news outlets to spread the word.

• Today, because consumers are able to get information from a variety of sources and platforms, a successful product launch requires an integrated approach; – one that includes • traditional, • social and • online marketing tools.

R'tist @ Tourism

• 1. Traditional Methods

– Even though new media seems to get all the glory, traditional television, print or radio media outreach remains an effective way to expose a never-before-seen product to the masses. Be sure to clearly spell out the elements of your product that make it newsworthy. How is it different from your existing products? How is it different from other similar products? What benefits does it provide to the consumer?

– Don’t discount other proven methods like advertising, trade shows, speaking opportunities, promotional events and direct mail. Ignoring them can lead to wasted opportunities. If you invest the time to truly understand the demographics and behaviors of the people hoping to reach, know if these traditional methods are worth time and investment.

R'tist @ Tourism

• 2. Search Engine Optimization (SEO)

– Before starting online efforts to market new product, one must have a “home base,” which ideally is a search-friendly website or blog.

– When launching a product, to aid both potential customers and contribute to optimized search engine performance, consider creating a product-specific landing page that features photos, descriptions and/or video.

– Make sure this page is appropriately coded for search, complete with keyword-rich copy, title tags, header text, a unique URL and meta information that succinctly describes your new product.

– Make sure this page is visible and easily accessible from your home page, at least for its initial release.

– To build online content library, consider enhancing traditional media outreach efforts and social media news presence by distributing product press release using paid services with both text-only and multimedia options, such as PR Newswire, PRWeb and PitchEngine.

R'tist @ Tourism

• 3. E-mail Marketing

– E-mail marketing is a fantastic way to provide specialized content to people with whom we’ve already built relationships.

– Consider offering a pre-order for new product, exclusive only to e-mail recipients. Or, offer a sneak peek at the new product before it's released to the public.

– This will help to nurture and reward existing relationships and continue building on the trust that is already earned.

– Additionally, we may set up an e-mail drip campaign that sends messages on a regular schedule at timed intervals to keep product or service top-of-mind with customers, and also to keep the sales funnel flowing.

• 4. Online Advertising – Tools such as Google AdWords (and other pay-per-click services) can boost

awareness and funnel parties directly to product. – Online advertising allows one to get in front of a specific audience but with

wide reach. – Another option is to do some research to determine the most widely read

blogs and sites in your industry and also those frequented by people in target markets.

– Advertising is often the main revenue generator on these sites and blogs, so it’s a great way to begin building relationships with the editors and site operators for a chance to get in front of the people who are most inclined to care about product.

– Don’t overlook opportunities to advertise on social networks. Some have predicted that $4 billion will be spent on Facebook advertising alone in 2011.

– Marketers are already realizing the benefit of getting in front of this giant’s more than 500 million users.

– If one choose to pursue any of these options, make sure the ads are clickable and direct all referrals to a targeted landing page on your company’s website.

R'tist @ Tourism

R'tist @ Tourism

• 5. Social Networks

– When product is ready to go, inform current customers and brand enthusiasts by updating existing social networks.

– Have a presence on one of the well-known platforms and/or another niche social network, craft catered messages for each.

– But, don’t just post to any of these social networks and walk away. – There are many tools available to manage multiple social network

profiles, keep the information up-to-date and continue to communicate with connections, while providing the social proof needed for people to buy.

– Naturally, these networks are filled with potential for people to share information.

– For this reason, make sure you provide valuable content. Try different mediums for discussing new product, such as videos, podcasts, photos and/or live chats.

R'tist @ Tourism

• 6. Geolocation

– If one have a physical location, customers frequently utilize geolocation tools like Foursquare or Gowalla to further marketing gusto.

– By closing the gap between online marketing platforms and a physical store, one can encourage sales through different channels and fully connecting the buying experience.

– Offer special deals for business’ mayors, and promotions for best customers;

– this kind of strategy goes a long way in creating a lot of buzz for new product.

R'tist @ Tourism

• 7. Group Buying Sites

– Groupon, Living Social, Deal On, My Daily Thread and other collective buying sites continue to grow in popularity and offer the opportunity to introduce and incentivize the purchase of product to an opt-in audience.

– These sites give you the ability to customize product offer by market and expand the product’s reach beyond those who are already familiar with company.

R'tist @ Tourism

• 8. Blogger Outreach

– Blogging has grown tremendously in the past five years. – Even though Technorati found that 65% of blogger survey

respondents are hobbyists, it’s likely one will find several bloggers in industry who have very active communities and traffic/subscriber numbers that blow traditional media websites out of the water.

– Blogger outreach goes hand-in-hand with traditional media outreach when it comes to generating interest for a new product, and the approach and methods used are much the same.

– Understand the blog, its audience and its content before sharing information about product. If it makes sense, offer product for the blogger to review.

– When working with bloggers, remember this golden rule: • Treat them with the same respect as you would traditional journalists.

R'tist @ Tourism

• 9. Social Media Influencers

– Using a strategy similar to traditional media outreach, take the time to research, locate and understand the most active social media users in target markets.

– These people are at a unique advantage, having earned a large and tuned-in set of viewers, listeners and followers.

– While the payoff might not be immediate, creating relationships with these highly influential people can lead to valuable long-term opportunities.

– While there is no universally accepted way to define and measure influence, using tools like Twitter Grader and Klout will give a good indication of the major players in the social space and in specific industry or market.

– Can also take it one step further and narrow search by category. – Tools like Twello allow you to search a directory filtered by self-identified

expertise, interests and professions. – This can be especially helpful for identifying Twitter users in a subfield that

directly relates to new product.

R'tist @ Tourism

• 10. Online Retail Sites

– Invest in partnership opportunities with well-respected online retail sites to improve the availability and credibility of business and product.

– Advertising on sites such as Amazon, eBay and Google Product Search will place product in an environment searched by people that have already identified themselves as inclined to buy.

– Amazon, specifically, offers a program called Amazon Advantage that allows sellers to delegate order fulfillment and shipping to Amazon.

– In addition, these products are eligible for “Free Super Saver Shipping” and are labeled as “shipped and sold by Amazon.com.”

– This provides buyers with the peace of mind they might not have when buying from an unknown vendor or site.

R'tist @ Tourism

Thank You…!!!©Ramakrishna Kongallae-mail: [email protected]