Chapter 11 Developing and Managing Products

A New Product is defined as a product new to the world, the market, the producer, the seller or some combination of these. There are different categories of New Products including new to the world, new product lines, additions to existing product lines, improvements or revisions of existing products, repositioned products and lower-priced products.

Disney's New Product

An example of one of Disney's new product strategies is improvements or revisions of existing products. This strategy is the new and improved version of the product that may be significantly or only slightly changed. Recently Disney announced new itineraries and ports for their cruise line for 2013.This improvement will expand to new destinations such as Venice, Italy and Greece. Also the Disney Cruise Line will utilize a second home port in Florida with Caribbean Sailings in Miami for their first time. With this improvement Disney is now able to to take more families to more destinations around the world.

New Product Strategy links the new product development process with the objectives of the marketing department, the business unit and the corporation.

Disney's New-Product Development Process

This process follows as :1. New Product Strategy

                          2. Idea generation

                         3. Idea screening

                             4. Business analysis

                        5. Development

                           6. Test Marketing

                                7. Commercialization

                          8. New Product

1. One of Disney's New Product Strategies was to expand their cruise line

2. New Product ideas evolve from many sources including customers, employees, distributors, competitors, vendors, research and development and consultants. The idea of the expansion of the Disney Cruise line has evolved from customers and competitors. In order for customers to reduce air fare costs they have decided to expand their ports and destinations closer to more consumers. Also while adding to their locations they will build stronger brand loyalty against their competitors.

3. Idea screening eliminates ideas that are inconsistent with the organization's new-product strategy  or are inappropriate for some other reason. Ideas on Disney's new fantasy ship ranged from appropriate concepts on the boat to the exact designs that emulate scenes from their movies. The Walt Disney Company CEO Bob Iger and his management devise weekly meetings to discuss every aspect of the $1 billion dollar boat.

4. Business Analysis is the stage where preliminary figures for demand, costs, sales and profitability are calculated. In order to estimate the financial numbers for this billion dollar Cruise Disney had to calculate the demand, cost, sales and profitability.

5. Development is the stage in which a prototype is developed and a marketing strategy is outlined.The expansion of more cruise lines will lead to the development and outlined strategy  of expanding and modifying the port facility to accommodate for the extension of the dock, enhancements to the terminal building allowing for additional luggage and passenger capacity and a multi level parking structure. Also the development for new entertainment and activities. In order to expand their entertainment Disney has developed the first ever Disney's Pixar Toy Story Musical.

6. Test Marketing is the limited introduction of a product and a marketing program to determine the reactions off potential customers in a market situation. Disney has noted they are continuing to test new markets as part of their growth. By operating in centers such as New York and Texas they are providing a convenient way for residents, testing new markets as to whether they enjoy the Disney Cruise Line Vacation.

7. Commercialization is the decision to market a product. The initial commercialization for the introduction of a product can vary from a few weeks to several years. After Disney has finished their development of the cruise line they introduced the expansion early in January of 2011.

8. New Product is at the end of the cycle bringing the product to the market which Disney has undergone with their Cruise Line

Chapter 16 Integrated Marketing Communications

Integrated Marketing Communications is the careful coordination of all promotional messages for a product or a service to assure the consistency of messages at every contact point where a company meets the consumer.

Disney's Promotional Strategy

A promotional strategy is a plan for the optimal use of the elements of promotion which includes advertising, public relations, personal selling and sales promotion.

The most common form of advertising is traditional media including television, radio, newspapers, magazines, books, direct mail, billboards and transit cards. The Walt Disney Company advertises their theme parks, television shows, movies and toys through traditional media.

As shown to the left there are Disney billboard advertisements leading to the arrival at the Walt Disney Park building up the excited anticipation to visit the park.  

Disney's Public Relations

Public relations is the marketing function that evaluates public attitudes, identifies areas within the organization the public may be interested in, and executes a program of action to earn understanding and acceptance. Also it helps an organization communicate with its customers, suppliers, stockholders, government officials, employees and the community which it operates. Recently with the devastating outcome of Hurricane Sandy Disney has donated 2 million dollars to relief efforts and has consistently broadcasted public service announcements on their ABC, ESPN and Radio Disney Networks encouraging viewers to support relief and rebuilding efforts. Disney presents a community minded image which consumers notice.

In 2009 Disney used a publicity campaign to promote their movie "Disney's a Christmas Carol". The Disney's Christmas Carol tour was a train tour that visited 40 cities with a multi car exhibit showcasing different aspects of the production. It was described as a rolling Disneyland exhibit but its free. The movie was top in the box office with $31 million in sales.

Disney's Sale Promotion Approach

Sales promotion contains all the marketing activities other than personal selling, advertising and public relations that stimulate consumer buying and dealer effectiveness. An example of one of Disney's many promotions is their vacation giveaways through their sweepstakes and contests.

The Sender and Encoding

The sender is the originator of the message in the communication process. Encoding is the conversion of a sender's ideas and thoughts into a message, usually in the form of words or signs. Disney's most famous campaign is "Let the Memories Begin" using photos and videos of real consumers visiting the parks and resorts, which will encourage even more people to visit the park. Disney noticed that consumers have a higher level of trust toward user generated content and the messages that come through as oppose to traditional advertising.

The Goals and Tasks of Promotion

These goals and tasks includes informing, persuading and reminding. Disney consistently broadcasts their upcoming attractions for their theme parks including a description for the ride and videos of what the experience will be like to inform consumers on whats new to come. Persuasion is an important factor for Disney because they appeal to the emotional needs and inner kid feelings to persuade consumers to continue visiting their parks. The reminding promotion keeps the product and brand name in the consumer's mind.

AIDA Concept

The AIDA Concept outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message. AIDA stands for attention, interest, desire and action. The Disney Cruise Line can be showed as an example for the AIDA concept.

1. Attention - The Disney Cruise Line began operation in 1998 so it was unknown and the company needed to create awareness. They created awareness through extensive ads on television and magazines.

2. Interest - Disney demonstrated the features of the cruise and the benefits for both kids and adults while sailing to various locations to create interest for their new cruise line.

3. Desire - Disney had to convince consumers their cruise was the best option for a family cruise by creating a game room, lounges, outdoor spas, casino, live shows, treasure hunts and more to show the idea that there's something for everyone in the family.

Action - To motivate customers to attend the cruise they consistently advertise the features and benefits.

Chapter 10 Product Concepts

What is a Product -  A product is everything, both favorable and unfavorable, that a person receives in an exchange. A product can be defined as a tangible good, services or ideas or a combination of these. The types of consumer products include, convenience products, shopping products, speciality products and unsought products.

Disney's Consumer Products -

Consumer Product - A product bought to satisfy an individuals personal wants.

Disney's consumer products includes speciality products. A speciality product is a particular item that the consumers search extensively for and are very reluctant to accept substitutes. To market speciality products status-conscious advertising is used to maintain the product's exclusive image. Brand names and quality of service are very important for speciality products. Disney products can be considered speciality products because of the company's exclusive image. Disney's merchandise is inspired by the popular characters from their animated films which produce toys, apparel, home decor and books.

Disney's Product Line and Product Mix

A product line is a group of closely related product items. An example of Disney's many product lines is their Cinderella line for all ages after the release of Cinderella The Diamond Edition. The collection of products includes toys, fashion, makeup, nail polish and home decor which are available at department and speciality retailers nationwide.

Product Mix- A product mix is all the products that an organization sells. All of Disney's apparel , television shows, toys and theme parks constitute its product mix

Repositioning- The change of consumers' perception of a brand. Disney typically targets to younger kids but in 2010 Disney repositioned by changing the family friendly movie Alice in Wonderland 19 years later to a dark live action adventure. The new look of Alice in Wonderland now targeted 12-22 years old with their merchandise in Hot Topic aimed at Gothic style.

Branding

A brand is a name, term, symbol, design or a combination that identifies a seller's product and sets them apart from competitors products. Disney's most famous brand symbol is their Mickey Mouse character. The benefits of branding is product identification, repeat sales, and new product sales. The Disney company has relatively high brand equity which is the value of company and brand names. Disney is a global brand that is very well known and wants to continue expanding "the Disney experience". Disney has also achieved brand loyalty which is the consistent preference of one brand over others. Their history and success of being a family brand has resulted in children favoring Disney products the most in comparison to other brands. The popular character Mickey Mouse is also one of Disney's trademarks. A trademark is the exclusive right to use a brand or part of a brand.