The video that I have watched was very interesting and informative. It has made a revolution in my head regarding the understanding of the difference between consumer needs and wants and about the segmentation process within the product. It was rather useful to understand that there is no perfect product for everyone, but there are the products that fit the specific group of people. This statement gave me the understanding that in order to make bigger profits, a company has to develop its product for as much target groups of people as possible, since it would ensure more prof. One point I also like in this video is the understanding that people do not know what they really want and like until they try it.
I think that the conclusions I have made are crucial for effective business management because only full understanding on what you should achieve and how it can be achieved can give efficient results for the company. It is important to understand that people do not always know what they want and this creates a niche for the company to work in. Clear understanding of this issue gave the possibility for continuous search of better way to satisfy the customers.
The knowledge of the necessity to find a better way to satisfy the customers of the company is always a motivation to think about; it is the task for the marketing department and new product development that can be continuously pointed for effective and efficient company existence and development. With the understanding of the differences between terms of wants and needs, it opens new possibilities for the company, because there is not enough to satisfy consumer needs, as only satisfaction of their wants would make them happy and, as a result, they would become company’s regular customers.
Kellogg had decided to create the family product because of the decreasing consumer interest to the All-Bran cereals. According to the term of the horizontal segmentation, this decision was made in order to satisfy more consumers and, as a result, to receive higher profits. Another point of view of the reasons of product family creation relates to the understanding that the life cycle of one product is shorter than the life cycle of the product line, because the product line or product family contains the life cycles of every product in the assortment. This increases the ability to receive more profits with the little difference among the products.
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Thinking about the family product as a whole, the entire brand is crucial for effective and efficient marketing campaign creation. The positioning of the product family with one common concept would increase brand recognition and create brand loyalty, at the same time, this would help to save money and decrease expenses on the image creation and advertising campaign. Building the marketing concept of the product family with the strong support of quality of the products would create the specific range of customers that would prefer not the specific product in the product line, but would be the customers of the brand.
When developing the own project, I would always remember the lesson of the horizontal segmentation and differences between needs and wants of the customers. This will help me to concentrate not only on the satisfaction of the things that customers are waiting from the product, but on the idea to find the range of products or to build the right family product in order to make the customers happy.