Product and Consumer Satisfaction: A Comprehensive Guide
Product and Consumer Satisfaction
The products of an organization help to create the image of the firm in the mind of the consumer. This image is reflected in the customers’ perceptions and feelings about its goods or services. People purchase products to satisfy needs or wants and obtain benefits as a result, normally exchanging it by money.
Main Principles in Strategic Marketing
- Satisfaction of Consumer needs: the consumer is the center of marketing actions. No need to develop products if does not have consumer sense or not defined by ‘consumer insights’
- Develop a Long-Term relationship with the consumer targeted
- Involves an exchange win-win, understanding marketing processes and system as an activity or just as a communication system.
Classification of Product Concept
The product has become the best way to satisfy the needs and the consumer can easily exchange money for it intended to obtain. Classification of this product concept is a hard task:
- Tangibility: goods and services.
- Intangibility: hopes and willingness related with a consumer satisfaction.
- Goods: physical caracteristics, tangibility
- Services: association of goods and persons. Requires time. Result intangible
- Experiences: combination of goods and services in a concrete moment of the time.
- Event: Planification and coordination of goods and services just in a moment of time but it disappears when consuming.
- Persons. It could be defined as a product in the mean way that conducts to company sales and results. Normally they are associated to the “celebrity” concept.
- Places. Is not a “product to be sold” but helps to conduct results and generating demand. Close relationship with tourism sector
- Organizations. Values, vision and mission can be transmitted to the consumer as a way to sell goods and services. – Ideas: That kind of product reflects the aim to satisfy needs or the way for obtaining a benefit (to ‘feel better’) after consumption.
Brand Concept and Value
Brand concept owns specific and valuable characteristics develop the product strategy of a firm. In fact, it is only “a part of the product” but reflects meanwhile part of the company identity becoming one of the most important topics to be considered when investing the resources. Brand concept is very difficult to define due to its heterogeneity and volatility. Brand is an idea reflected on consumers’ mind, reminding them positioning items and attributes related to products that company commercializes. In this sense, the brand become as the most important attribute of a product due to it is able to offer value to consumers and firms. Whether consumer perceives expected benefits and clear positioning of the brand/firms, the identity created in the mind will generate positive expectations and behaviors when purchasing and consuming. This fact, will create a positive emotional bond known as loyalty. To sum up, companies develop strategic plans (with huge amounts of investment) to develop brand concept in consumers mind, being a powerful vehicle to conduct firm image, positioning, perceptions, etc. from its consumers.
Product Life Cycle Overview
As seen, environmental forces, market conditions, consumers and competitors are continuously changing; product portfolio offer needs to be in continuous adaptation to satisfy consumer needs.Product development and innovation is one of the most important strategic decision to define company evolution and trend (and most survival) for the next years. Companies need to adapt its business to environmental changes in order to continue performing an offer based on satisfying in the best way consumer needs. Just following Proctor analysis (Proctor, 2008), developing the ranges of products (for segments) should be:
- New lines can be added to widen the product mix. It works with complementary products: a manufacturer of devices can develop a line of batteries.
- The length of existing product lines can be increased by introducing additional items, e.g. the manufacturer of DVDs can develop TVs, radios or laptops.
- New product variants can be added to deepen the product mix, e.g. the radio manufacturer can add new models which are the same size as existing items but which have different features.
- Product consistency can be made more or less depending upon whether a firm wants to acquire a strong reputation in a few or many different areas.
One problem that has been found in trying to make use of the product life cycle concept as a management tool is that many products do not appear to perform in the market place as it suggests
Introduction
Sales are low and promotion and distribution are relatively high. Obtaining distribution for a product requires amounts of cash and promotional costs are greatest in relationship to during the introductory stage. In addition, extensive promotion is required to secure distribution. High margins can provide the cash heavy promotional expenditure and this in turn produces high initial positioning
Growth
New competitors enter the market attracted by the prospect of production potential and the large profits to be made as the market grows size and economies of scale come into operation. There is also a decline in the ‘promotion sales ratio’—that is the amount of money spent on promotion in relation the amount of sales generated, since sales are expanding during this stage. The net result of all this is that increased profits are generated as costs spread over a larger volume and unit manufacturing costs decrease. several strategies to keep up market growth as long as possible (continually looking for new ways to improve product quality ,adding new features to a product ,refining the styling of a product ,introducing new models and flanker products)
Maturity Stage
The maturity stage follows on from the onset of decline in the rate of sales growth. The latter produces over-capacity in the industry which in turn leads to increased competition. It is a stage in which profits decline. During the maturity stage, firms implement frequent price reductions and increase advertising and consumer promotions.
Decline
Sales of most products eventually start to decline for one or more of several reasons. These include technological progress, shifts in consumer tastes increased domestic and foreign competition. Over-capacity in the market produced together with price cutting and lower profits. At this time firms may withdraw from the market and those remaining reduce the number of products that they have to offer, pull out of smaller market segments and weaker trade channels, cut the promotion budget or reduce prices even further.