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• Module overview
• 1. What is marketing?
  • 1.1 What is marketing?
    • 1.1.1 Different uses of the term 'marketing'
    • 1.1.2 Different levels of marketing
    • 1.1.3 A definition of marketing
  • 1.2 Clarification of the marketing definition
    • 1.2.1 Outputs
    • 1.2.2 Inputs
    • 1.2.3 Exchange
  • 1.3 Development of marketing
  • 1.4 Types of marketing
  • 1.5 What is a service?
    • 1.5.1 Characteristics of services
    • 1.5.2 A service definition
    • 1.5.3 Classifications of services
    • 1.5.4 Services: a growth sector
  • 1.6 Marketing in the maritime industry
  • 1.7 Towards social and ethical responsibility
    • 1.7.1 Common criticisms of marketing
    • 1.7.2 Social impact of marketing
  • 1.8 Summary

• 2. Strategic marketing management

  • 2.1 Introduction
  • 2.2 The environments
    • 2.2.1 External environment
    • 2.2.2 Internal environment
    • 2.2.3 Mission statements and objectives
    • 2.2.4 Resources
  • 2.3 Controllable factors
  • 2.4 The strategic marketing management process
    • 2.4.1 Planning
    • 2.4.2 Implementation and control
    • 2.4.3 Marketing plan
  • 2.5 Types of marketing strategies
    • 2.5.1 Strategic considerations for services
  • 2.6 Summary

• 3. Marketing research and information systems

  • 3.1 Introduction
  • 3.2 The marketing information system (MIS)
  • 3.3 Marketing research
    • 3.3.1 Scope of research
  • 3.4 The marketing research process
    • 3.4.1 Step 1: defining the problem
    • 3.4.2 Step 2: analysing the situation
    • 3.4.3 Step 3: obtaining problem-specific data
    • 3.4.4 Step 4: interpreting the data
    • 3.4.5 Step 5: solving the problem
  • 3.5 Summary

• 4. Consumer and B2B buying behaviour

  • 4.1 Introduction
  • 4.2 Consumer buying behaviour
    • 4.2.1 Psychological influences
    • 4.2.2 Cultural and social influences
    • 4.2.3 The decision-making process
  • 4.3 B2B buying behaviour
    • 4.3.1 Business buying processes
    • 4.3.2 Main types of business markets
  • 4.4 The buying of services
  • 4.5 Summary

• 5. Segmenting markets, targeting and positioning

  • 5.1 Introduction
  • 5.2 Market segmentation
    • 5.2.1 Dimensions used to segment markets
  • 5.3 Target markets
  • 5.4 Market positioning
  • 5.5 Summary

• 6. Product planning and decisions

  • 6.1 Introduction
  • 6.2 Product concepts
    • 6.2.1 The total product concept
    • 6.2.2 Product classifications
    • 6.2.3 The service offering
  • 6.3 The product mix
  • 6.4 Branding
  • 6.5 Packaging
  • 6.6 Product life-cycle
  • 6.7 Product development
  • 6.8 Summary

• 7. Pricing considerations

  • 7.1 What is the 'price' of a product?
  • 7.2 Pricing environments
  • 7.3 Pricing objectives
  • 7.4 Pricing policies
    • 7.4.1 Discount and allowance policies
  • 7.5 Price setting
    • 7.5.1 Cost-oriented price setting
    • 7.5.2 Demand-oriented price setting
    • 7.5.3 The price setting process
  • 7.6 Summary

• 8. Marketing logistics networks

  • 8.1 Introduction
  • 8.2 Definition of distribution
  • 8.3 Channels of distribution
    • 8.3.1 Selecting channels
    • 8.3.2 Main Australian channels
    • 8.3.3 Distributing services
    • 8.3.4 Managing channels
  • 8.4 Managing distribution
  • 8.5 Distribution and ports
  • 8.6 Summary

• 9. Integrated marketing communications

  • 9.1 Communication with a purpose
  • 9.2 Marketing communication process
  • 9.3 The promotional mix
  • 9.4 Managing advertising
  • 9.5 Managing publicity and public relations
  • 9.6 Managing personal selling
  • 9.7 Managing sales promotion
  • 9.8 Summary

• 10. E-commerce and direct marketing

  • 10.1 Introduction
  • 10.2 Direct marketing
  • 10.3 Electronic commerce
    • 10.3.1 Successful e-commerce
  • 10.4 Online marketing
  • 10.5 Using customer databases
  • 10.6 Privacy issues
  • 10.7 Summary

• 11. Managing the service encounter

  • 11.1 Introduction
  • 11.2 Participants
    • 11.2.1 Customers
    • 11.2.2 Service personnel
  • 11.3 Managing the service encounter
    • 11.3.1 Role theory
    • 11.3.2 Script theory
  • 11.4 Process
    • 11.4.1 Operations management and services
    • 11.4.2 Manufacturing efficiency
    • 11.4.3 Improving services efficiency
    • 11.4.4 Matching supply and demand
  • 11.5 Physical evidence
    • 11.5.1 Types of physical evidence
    • 11.5.2 Space demarcation
    • 11.5.3 Atmospherics
    • 11.5.4 Servicescapes
  • 11.6 Summary

• 12. Customer relationship management

  • 12.1 Introduction
  • 12.2 Customer relationship management
  • 12.3 Customer satisfaction
    • 12.3.1 Benefits of customer satisfaction
  • 12.4 Service quality
    • 12.4.1 Conceptual model of service quality
    • 12.4.2 SERVQUAL
  • 12.5 Summary

6.7 Product development

Every firm needs to periodically examine the number and diversity of products in its stable. Product development does not just mean creating new products. It can also mean revitalising and repositioning present products. This has happened with passenger ships, which no longer serve as a major means of transporting people, but of entertaining them.

However, if organisations are developing new products they must keep in mind that many do not succeed and there are many reasons for that. Table 6.2 summarises some of these reasons for you.

No firm can depend on its current products indefinitely for growth and profitability. So, even though it is high-risk and high-cost over the long haul, firms have to be involved in new product development. In Figure 12.4 in Kotler et al. (2004, p. 447) you are given a graphic illustration of the steps in the development process.

Consider this

Do you feel that such a process is in existence in your organisation or an organisation you are familiar with?

Table 6.3 Why new products fail

Bad concept : The product does not meet a consumer need or does not offer a good value. Insignificant difference: A difference exists but isn't significant enough to warrant changing from a current brand; many failures here are 'me-too' products. Poor execution : The product never actually duplicates the original, proven concept. Inadequate budget : Underestimating the investment needs to launch a new product and move it into profitability can adversely limit development at every step, from initial R&D through promotion. Insufficient market size: The market may not be big enough to generate volume necessary to produce a profit. Bad timing: The product may be tested or introduced at the wrong time of year or in the wrong cultural or economic environment. Mistargeting : A good product may be offered to a group that doesn't want or need it. Mispositioning: A product designed to do one thing may be positioned as something different or marketing communications explaining the product may be unclear. Misjudging the competition : A company may fail to read the exact nature of the competitive situation and lack adequate planning for competitive counter-strikes. Misestimating: Forecast sales may be overstated or costs may be underestimated. Market changes: The market environment may change between testing and launch. Wearing blinders: A company may become so committed to making a concept come alive that it subconsciously overlooks or downplays all 'bad news' as it goes through the developmental steps.

Source: Keegan et al. (1995, p. 409)

Bear in mind, however, that having a systematic new product development process does not eliminate the risk of a marketing disaster; it only lessens it. One of the exciting aspects of marketing is that a new product can pleasantly surprise you by being a runaway success!

However, in reality, there are seldom true innovations like the aeroplane, computers, DVDs or ball-point pens that revolutionise our lives and are outstanding marketing successes. Often it is only the larger firms that have the financial resources, research facilities and plant capacity to produce innovations. Yet, since they are also rather bureaucratic, they tend to stifle creativity. Hence there is a trend towards giving small, unstructured project teams within the firm the freedom to innovate and to act in an entrepreneurial role.

You can read all about the new product development process in your textbook, and an example in the first article of how the process could be applied to developing a new butter product. Now is also a good time to read how Branch (1998) applies the 7P marketing mix to ports and shipping. By working through this reading you will not only gain a broad perspective of each of the extended marketing mix elements but also understand how they relate to the maritime sector. This is a useful reading to keep referring back to as you progress through the chapters. Note however that Branch (1998) mistakenly refers to the 7P marketing mix as the international marketing mix. Please now turn to the next readings.

In your text

Kotler et al. (2004) Chapter 12, pp. 436-460, 'New products', 'New product development strategy', 'The new product dilemma' and 'The new product development process'.

Reading 6.5

Hudson, K. 2002, 'Developing new products? Develop new thinking', Marketing & eBusiness , April, pp. 42-43.

Reading 6.6

Branch, A. E. 1998, Maritime Economics: Management and Marketing , 3 rd edn, Stanley Thornes, Cheltenham , United Kingdom , pp. 341-357.

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