Marketing_Management_14th_Edition-min

338 PART 5 SHAPING THE MARKET OFFERINGS
|Fig. 12.3|
Product-Item
Contributions to a
Product Line’s Total
Sales and Profits
Percentage Contribution to
Sales and Profit
50
40
30
20
10
Sales
Profits
0
1
2 3 4 5
Product Item
and voice mail. Companies should recognize that items can differ in their potential for being priced
higher or advertised more as ways to increase their sales, their margins, or both. 29
MARKET PROFILE The product line manager must review how the line is positioned against
competitors’ lines. Consider paper company X with a paperboard product line. 30 Two paperboard
attributes are weight and finish quality. Paper is usually offered at standard levels of 90, 120, 150,
and 180 weights. Finish quality is offered at low, medium, and high levels. Figure 12.4 shows
the location of the various product line items of company X and four competitors, A, B, C, and D.
Competitor A sells two product items in the extra-high weight class ranging from medium to low
finish quality. Competitor B sells four items that vary in weight and finish quality. Competitor C
sells three items in which the greater the weight, the greater the finish quality. Competitor D sells
three items, all lightweight but varying in finish quality. Company X offers three items that vary in
weight and finish quality.
The product map shows which competitors’ items are competing against company X’s items.
For example, company X’s low-weight, medium-quality paper competes against competitor D’s
and B’s papers, but its high-weight, medium-quality paper has no direct competitor. The map also
reveals possible locations for new items. No manufacturer offers a high-weight, low-quality paper.
If company X estimates a strong unmet demand and can produce and price this paper at low cost,
it could consider adding this item to its line.
Another benefit of product mapping is that it identifies market segments. Figure 12.4 shows
the types of paper, by weight and quality, preferred by the general printing industry, the point-ofpurchase
display industry, and the office supply industry. The map shows that company X is well
positioned to serve the needs of the general printing industry but less effective in serving the other
two industries.
Product line analysis provides information for two key decision areas—product line length and
product mix pricing.
|Fig. 12.4|
Product Map for a
Paper-Product Line
Source: Benson P. Shapiro, Industrial Product
Policy: Managing the Existing Product Line
(Cambridge, MA: Marketing Science Institute
Report No. 77–110). Copyright © 2003. Reprinted
by permission of Marketing Science Institute and
Benson P. Shapiro.
Finish Quality
High
Medium
Low
General
printing
D
D
B
C
C
D X X A
B
X
Point-ofpurchase
displays
C
Office
supplies
B
A
B
Low (90)
Medium (120) High (150) Extra high (180)
Paper Weight