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- [Instructor] Hello, and
welcome to the lecture

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on the first P of our marketing mix.

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It stands for product.

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So this is about a product,

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and more broadly service to development.

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How do you create an offer, a
product that will create value

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for customers and help
you fulfill the mission

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of the business or the organization?

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Here's an overview of what we're gonna do.

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We're gonna talk about innovation.

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We're gonna talk about traits
for success, for a product.

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We're gonna talk about the MVP model

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that does not stand for
most valuable player,

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but minimum viable product.

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We're gonna talk about
the product life cycle

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and a model of adoption and
the diffusion of innovation

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and of new products.

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Here's the homework that's
associated with this week.

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So, consider that the
main product or service

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that you will be offering.

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And you can answer these questions.

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First, I want you to
think about the innovation

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and how it fits with the position
that you have identified.

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Next, I want you to
consider the MVP concept

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and see how, and if it can
be applied to your case.

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I want you to list the
characteristics of success

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and sort of judge them.

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Where do you rate strongly,
and where maybe not so strongly

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and what can you do to
accentuate a strength

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and shore up a weakness.

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And then think about who
will be the early adopters

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and how can you bring more
customers in over time?

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So again, I think this
homework will make more sense

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once you see it in context.

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So new products can be
delivered in a few ways.

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You can add new functionality
to an old product

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or a new product in an old line.

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And one of the things I
want you to think about,

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is innovation.

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And one way of thinking about innovation,

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is how disruptive to consumption
patterns is the product.

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So I have here photos of a
rotary phone, a stereo system,

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a multi-component stereo
system like I used to have

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back in the day, and a desktop computer.

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And thinking about how in many ways,

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and probably in order from top to bottom,

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these items in the photos
are rather obsolete now.

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You really don't see them a lot,

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especially except as some
sort of retro statement.

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You really don't see a
lot of rotary phones.

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And in many ways, they've been replaced

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by these three things that you see

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in the bullet points here.

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Cell phones have largely
replaced rotary phones,

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iPods, or actually cell
phones have replaced this

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and headphones or earbuds,

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have largely replaced
multi-component stereos.

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And laptops have largely
replaced desktops.

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So you can think about the innovation

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has been, how disruptive has it been?

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Has it made products obsolete
and has it really changed

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how people consume things
where they buy things?

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So, one thing I was thinking about,

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is how few people have landlines now.

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They're becoming more and more rare.

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I would say most folks who
have a landline, for example,

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my 80 something parents have a landline.

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I don't, most young folks I know don't.

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Few folks have a multi
component stereo now.

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I mean, almost folks stream it online.

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You really don't buy music
on a piece of plastic

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as often anymore.

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So these items have been really
disruptive to the products

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that they have replaced.

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You can think of this as
three types of innovation,

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there's sort of a continuum
rather than distinct categories,

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but at the one end, you can
think of it as continuous,

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where there's only a minor modification.

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So taking an existing product
and offering in a new flavor,

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a new color, a new package,
new size, et cetera.

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In the middle is what we think
of as dynamically continuous,

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which is there's a big change,

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but it doesn't disrupt.

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So a hybrid car is pretty
different from a regular car.

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A CD is a different
product than a vinyl album,

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but it's still a piece of plastic.

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A hybrid car is still a car.

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A cordless phone is still
connected to a landline.

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But then you can think
about discontinuous,

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which really is a fundamental change.

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So, PCs personal computers have
certainly changed our lives

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in countless ways.

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Streaming movies on the
internet, social media.

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There really wasn't anything before that.

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MP3 files, have meant that we share

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and listen to music electronically,

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where rather than buying
a piece of plastic,

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cell phones mean that you
don't have to be home,

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that you can talk to people as
well as all the other things

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that phones do, text and
taking pictures and videos

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and all kinds of things like that.

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Here are a number of links to websites,

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which talk about how to innovate
the nature of innovation,

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how to do it, what to look
for, why it's an advantage,

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lots of questions like this.

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So please have a look at these

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before our in-class discussion.

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Next, I'm going to walk you
through the characteristics

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of success, and I will go through each one

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in the next few slides.

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The first one is superior advantage.

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That customers must perceive

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that your product or service is better.

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There must be something about you

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that will make them change,
that will make them try it,

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that will make them keep buying it.

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And think back to our
customer value equation,

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that in some way you must be
offering perceived benefits.

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There's something of
value, something better

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and or at a lower cost.

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So might be the actual
monetary cost they pay

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as well as time convenience.

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But, you really have to offer
something that is superior

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compared to what they're buying now.

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Next, it should be compatible.

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So, it should align well
both with your business

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and with the community.

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So you can think about that your products

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should align with your values

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as well as it should be
a good fit for the people

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you're trying to sell them to.

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In their attitudes,
their norms or behaviors.

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So a lot of what you say
in your mission statement

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might help inform whether
this product is compatible,

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so on the strength and weakness
side of the SWOT analysis,

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as well as the community.

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So the opportunity and threat
side, is it a good fit?

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Does it put you into
that top right quadrant

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of the SWOT analysis of
strengths greater than weaknesses

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and opportunities greater than threats.

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Next, is simplicity.

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It should be fairly
straightforward how to use it.

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That it should be something
that people can pick up and use.

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The instruction should be pretty
simple and straightforward

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having only basic skills.

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That the more that people can
easily use it and consume it,

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the greater the chance of success,

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and the more sort of hurdles
that exist toward the using it

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makes it less likely to be successful.

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Next, is observability.

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And this goes back to
the superior advantage.

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That where the innovation
is, why it's better,

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why it's different, why it's improved,

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should be really obvious.

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It should be either observable
or very easily communicated.

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Next, is trial ability.

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So you don't want something
that's a huge risk.

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That you can do things like free samples,

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an introductory price, a
smaller trial package size.

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But, the more that the consumer

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can kind of take your
product for a test drive,

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figuratively speaking, can
try it out, try a sample,

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a small size, the more
that you make it easy

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for them to try it at a low,
you know, low costs to them.

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Not a lot of effort, not
a lot of money to try it

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for the first time, that the more likely

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it will be successful.

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And last, last is low perceived risk.

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So here you want to decrease the risk.

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So, in things like
warranties and guarantees,

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that's ways that if they don't
like it, they can return it.

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So thinking back, it's sort
of related to trial ability.

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But in this case, it's
what kind of assurance,

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especially if they do make a fairly large

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upfront investment, what
can you do to assure them

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that if they don't like it,
that if it all goes wrong,

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they can return it or, you know,

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offering some sort of
warranty or guarantee

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that they can get their money
back if things go wrong.

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This is the end of part one.

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Please go to part two.

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Thank you.