New Product Opportunities
By Leslie Pratch
When I was getting my M.B.A., I outlined what I considered most useful to digest the curriculum and to help my classmates preparing to interview for consulting firms. Nearly a decade later, I realize these notes may be helpful to first- and second-year M.B.A. students at Chicago Booth (and elsewhere) who are boning up for interviews with consulting firms. I offer them freely and if they are helpful, encourage your use of them, especially if you are pursuing a leadership position in a consulting firm.
When considering new product opportunities, consider four categories of new products:
(1) Existing market; existing product (i.e., enhanced product)
(2) Existing market; new product
(3) New market; existing product
(4) New market; new product
When marketing a new or existing product, remember the four P’s-the four things you can tweak when marketing a product:
(1) Product:
(a) Design/packaging
(b) Bundling of product with other products
(c) Services and warranty
(d) Price/Quantity ratio—how large of a segment is willing to pay for your level of quality
(2) Price
(a) Discounts
(b) Price discrimination (e.g., coupons)
(c) Economic incentives to distribution channels (e.g., commissions)
(3) Promotion
(a) Advertising
(b) Branding/Image
(c) Consumer education (about how to use your product)
(d) Public relations/reputation
(e) Grow the market as a whole
(4) Place (i.e., distribution)
(a) Experiment with channels
(b) Strengthen channels
(c) Focus channels
(d) Decrease costs
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Leslie Pratch, Ph.D. is a clinical psychologist with an M.B.A. in Strategy and Finance and a B.A. in Religion from Williams College. She works with boards of directors and private equity investors to select and develop executives. She can be reached at (312) 464-7919 or email her at leslie@pratchco.com or visit www.pratchco.com.
