Product Market Management may be called product management marketing or product marketing management. It is the function that acts as the liaison between the outside sales force/ and or customers and the internal departments in the company.
The process of planning
Planning is the keystone of product and market management. In our rapidly changing world and more especially markets, there exists a need for a process that moves an idea from creative thought to a distinct value for the company. That process consists of Analysis, Planning, and Communication. Planning, being in the middle between analysis and communication, is the keystone that holds the three parts up to support the process.
The process must contain specific mileposts that when attained require a review to determine whether or not to proceed with the development of the new product or service. The ongoing review process means then that as part of the planning process, that success is defined in advance. In the planning process, it also must be positively affirmed that the idea fits with the culture and capabilities of the organization. The planning process must also define what the idea is, how it works, why it should be done, who is going to do it and who is going to use it. When and where must also be outlined. Once these issues are defined then they must be tested and revised into a new iteration of the plan. Test and iterate until perfected or discarded.
Since planning is the keystone of product and market management, a deficient plan will cause the entire innovation process to collapse.
The importance of analysis
Analysis and synthesis of equal believability. Believability is crucial to the success of product managers and market managers as they provide the liaison between the internal parts of the organization and the external world of sales, marketing, distribution, and customers. Without sound analysis and synthesis of that information, the believability of the product management comes into question and the ability to do the job is diminished.
Market managers and product managers must have carefully analyzed what is being done presently, where the product or competitive product is in its lifecycle. They must analyze upstream and downstream capabilities and requirements. The ease of change must also be evaluated. What outside factors (P.E.S.T.L.E.) will affect the product and the market. The resources available and the constraints facing the organization must also be analyzed. With new product ideas, the fit with the culture, values, return-on-investment, and people of the organization must also be considered. A competitive analysis is always critical to success.
Once the information is gathered and analyzed comes the task of synthesizing the best possible planned solution for the customer, the company and for the people involved. The resulting plan must optimize all of the variables to increase the likelihood of success.
Promotion Decisions are the last of the 4 Ps because they are dependent upon the preceding 3 Ps. Product, Price, and Place will all define the parameters for the Promotion Decisions.
The product quality, brand, warranty, and service all make a statement about the image of the product. Image or perception of the offering is important when considering promotion alternatives.
Pricing, whether it is high priced or low priced, also makes a statement that needs to be incorporated into promotional considerations.
Place or channel of distribution also is an indicator of promotional tactics. Whether your product is sold in a high-end retail outlet or a low priced discounter will affect how the promotional program needs to be developed.
If, for example, you decide to sell direct via the internet, your pricing, packaging, and distribution might be set in a way that would preclude you from being able to sell through wholesalers to retailers at a later date as your packaging, pricing and distribution would not be appropriate for that channel. Is there sufficient margin to cover your sales costs, wholesaler margins, retail packaging, retailer margins, co-op advertising, volume rebates, merchandisers and more when your original plan was to sell direct via the internet
Product – Market Management is all about balance. The products, brands, and markets that we manage all have a product-life-cycle that requires modifications of the marketing mix if we are to maximize the profitability of that product, brand or market over its life.
The different stages of the product life cycle present us with challenges and options that must be evaluated. Sometimes, we are forced to consider trade-offs and optimize performance based upon a balance of the options available to us at that particular time. As the product moves through the various stages it is critical to adjust the marketing mix to reflect the current situation.
Finding creative solutions to resolve the conflicts that occur between strategy options and the 5 Ps is always a matter of balance.
The work with a product
One of the most difficult things a product or market manager has to do is pulling the plug on a product. So much time and effort go into exploring a product, the market, the opportunities, and the strategies that the manager feels like the product is an extension of themselves. It is an extremely difficult thing to do in part because of the investment up to the point of pulling the plug.
Jack Welch at General Electric suggested that if a product couldn’t be one or two in the market, then the best option was to drop the product and move the resources supporting that product to something else with a better chance of getting to first or second in the market.
The easiest way to face a product reduction is through a regular product line review. Seasonal products might best be reviewed at the end of a season. sometimes it makes sense to evaluate after an important trade show. Some managers I know review product lines several times a year while others do an annual product line review. Having an established review certainly makes facing the issue a little easier.
It is also important to remember that the product manager’s job is to maximize the profitability of the product over the life cycle. If the profitability isn’t there or the product is approaching the end of its life cycle, the decision to pull the plug is easier to make. Hopefully, the product manager was able to anticipate the steps in the life cycle and is using creative destruction to bring a new, profitable product to market to replace the one on the way out.