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what are the elements of the design mix?
function, aesthetics, cost
what does the function do?
the product/service needs to be fit for purpose, needs to perform well, needs to be practical, usable, safe, reliable and functionable
what are aesthetics?
the appreciation of beauty in a product (how it looks, taste and feels)
what is cost?
how the price can be used effectively
why does lower costs of production mean a business gains an competitive advantage?
it allows the business to produce more products at a lower price, therefore, more sales will be made
what is a product lifecycle?
the birth to death process of a product as it grows and falls
what are the elements of the product lifecycle?
research & development, introduction, growth, maturity, decline
what is research & development?
when the product is designed and market research is used to analyse the product to meet customer needs-very expensive phase, the product is not making any revenue/profit (investment)
what is introduction?
when a product is launched to the market-sales may be low as customers won’t know the product, advertising will be used
what is growth?
when the product is making big sales and is popular-advertising will still be used
what is maturity?
when the market is starting to become saturated-many other business will have now come out with own versions of the product, sales are high but profit will start to fall, products will be discounted
what is decline?
when a product is no longer making any sales and will be taken off the market-items will be heavily discounted before the product becomes obsolete
how can a product’s lifecycle be extended?
updating packaging, adding more/different features, changing the target market, advertising
what can a business do by changing the packaging?
the products maturing or declining will get a fresh new image and will be re-released-encourages customers to continue to buy the product (aesthetics)
what can a business do by adding more or different features?
a new style of a product (modification) will remind past customers to change the product to a new version (phones, cars)
what can a business do by changing the target market?
the business will choose to segment their products to a different age group or interest group-marketing, advertising, social media
what can a business do by advertising?
a new creative advertising campaign can regain customer interest and make an impact on product sales
what is a benefit to a business of withdrawing a product from the market when it reaches the decline phase?
it allows the business to save money for future products, reduces costs
what is differentiation?
when a business makes their product/service different from competitors
how can a business differentiate their product?
branding, unique selling point, location, design, customer service
how can a brand differentiate by branding?
customers will buy a product because it is their favourite brand, helps build the brand
how can a brand differentiate by their unique selling point?
makes the business stand out from other competitors
how can a brand differentiate by location?
by having a service in the right area (petrol station on a busy road, pub on a housing estate etc)
how can a brand differentiate by design?
used to brand and promote the products, helps customers identify the brand through packaging
how can a brand differentiate by customer service?
helps customers see that a brand is capable of treating them well (airlines, hotels etc)
what are the benefits of producing a high quality product/service?
improves brand image, allows a business to charge a premium price, fewer customer complaints
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