Categories of Products You have recently started working as a product analyst at
ID: 424218 • Letter: C
Question
Categories of Products You have recently started working as a product analyst at a company that manufactures and sells a variety of soft drink products. One of your first jobs is to categorize each of the firm's new products for the upcoming year into the appropriate new product category for a presentation you are putting together for your manager. A new product is one that is new to a company in any way. If a product is functionally different from existing products in the market or is not marketed in its current form or manner by the company, it can be considered a new product. We categorize new products in the following four ways: New-to-the-market products New category entries Product line extensions Revamped products A company's core competencies and strengths influence its strategy toward developing new products. Firms that have a strong research and development (R&D) department will focus on developing new-to-the-market products to beat the competition, while firms that have a strong brand and company image can take advantage of existing products to extend or revamp their current product lines with similar but somehow differentiating attributes. Match the new product with the appropriate new product category. 1. Smartphone app that can scan any beverage and show you the exact nutritional components in detail. Revamped products Incorrect 2. Candles that make your home smell like your favorite cola. New category entries Correct 3. Selling a more caffeinated version of your traditional cola targeted at younger consumers. Product line extensions Correct 4. A 5-ounce package of your popular cola product that is better for the environment. Revamped products Correct 5. New beverage that can be made from concentrate for international consumers in a way that has never been done. Product line extensions Incorrect 6. Selling suntan lotion that has the scent of your favorite cola. New category entries Correct 7. New 10-calorie version of the company's cola product that is targeted to male consumers. Revamped products Incorrect 8. Diet soda product using a new type of artificial sweetener. Product line extensions
Explanation / Answer
1. Smartphone app that can scan any beverage and show you the exact nutritional components in detail.
New to the market
2. Candles that make your home smell like your favourite cola.
New category entry
3. Selling a more caffeinated version of your traditional cola targeted at younger consumers.
Product line extensions
4. A 5-ounce package of your popular cola product that is better for the environment.
Revamped product
5. New beverage that can be made from concentrate for international consumers in a way that has never been done.
New to the market
6. Selling suntan lotion that has the scent of your favourite cola.
New category entry
7. New 10-calorie version of the company's cola product that is targeted to male consumers.
Product line extension
8. Diet soda product using a new type of artificial sweetener.
Revamped product
Explanation
New-to-the-market products
Inventions never existed before and create a new market
New category entries
Products that are new to the company but not new to the market
Product line extensions
Additional products with new functions, flavours, or other attributes are added to an existing line.
Revamped product
An existing product is modified with new formulas, packaging, different features, and updated designs and functions
.1.Assuming no such apps ever exist for calculating nutritional value of drinks, we can consider this new to the market (or else it can be considered new category entry- Soft drink company (category 1) introducing an app (category 2))
2. Soft drink company (category 1) introducing an candle (category 2). Flavoured candles already exist in market
3. An additional version is added to the existing version. Existing version is not replaced. Original product- tradition cola, is also sold.
The product with new formulation is essentially marketed as another different product from the company (but still in the same soft drink category)
Also note a new specific is targeted. For e.g. the traditional cola may be marketed for all age groups. This version is targeted only at young consumers
4. Original product is improved with packaging – a new version replaces old version. No additional products. The product with new packaging is essentially marketed as the same original product not as an another new product
5. Such a product or similar product has never existed. We are trying to bring a new drink to the market
6. Soft drink company (category 1) introducing a suntan lotion (category 2). Flavoured suntan lotion already exist in market
7. An additional version is added to the existing version. Existing version is not replaced. Original product- tradition cola is also sold.
The product is essentially marketed as another different product from the company (but still in the same soft drink category)
Also note that the target segment varies. For e.g. the traditional cola may be marketed for all groups. This version is targeted only at male consumers
8. Original product is just reformulated. The product with new formulation is essentially marketed as the same original product not as an another new product
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