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Discussion and Participation questions
Pages 3 (753 words)
1. There are many things that companies should consider when developing a product. The objective of developing a new product is to help companies improve their sales. Prior to developing a product the product development team has to work with the marketing department to determine the target market for the product.
A product that came out over 10 years ago which failed very fast after its release into the marketplace was Cherry Cola. The flavor of the soda was awful. A product that was introduced by Microsoft to compete directly with the IPod was the Zune. The Zune player failed to achieve the goal of threatening the dominance of the IPod in the portable music player market segment. A product in the automobile industry that failed was the Yugo auto brand. The Yugo was a very inexpensive automobile whose target market was the low income customers. The cars lack of performance, reliability, and style made this product a failure in the marketplace. 2. Companies should consider a variety of factors when establishing a price policy for a product or service. One of the most important factors in regards to price is that a price point must be selected at a value that is sufficient to cover the direct cost and overheads of the company and to earn a decent profit. Companies that select a price point that is too low might run out of business soon because if sufficient revenues are not generated a company will go out of business. Once the correct profit formula is in place there are several other factors to consider. A very important factor in price setting is the competition. The price of the competition will determine the lowest or highest price one can charge for a similar item. ...
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