BSBCUE309 – Acquire Knowledge of Products and Services in a Specified Area Copy

BSBCUE309 – Acquire Knowledge of Products and Services in a Specified Area Copy

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Identify Information Sources on Products and Services in a Specified Area and Evaluate them for Reliability and Validity

Knowing Your Business

Finding the Facts

To effectively convey information about products or services, you must have in depth knowledge about them. And the knowledge or information that you gain must be reliable and valid. Often, getting the information is the easy bit – manuals and marketing material will provide much of this.

However, how do you then know that the information is able to be relied on when you pass it on and that it will support the claims that you are making for your products and or services? The products or services could include:

• Goods
• Ideas
• Infrastructure
• Private and public sets of benefits.

Sources of information

Association – Information involving discussion of users, both the pros and cons is usually reliable. If it is coupled with advertising or sponsorship, then it is not reliable as it is just the sales pitch of the seller.

Catalogues – Not reliable as it is just the sales list and description of the seller.

Claims of competitive sales people – Not reliable as they are also trying to make sales and will be exaggerating their product value and undermining the competition.

Competitor websites – Not reliable as they are also trying to make sales and will be exaggerating their product value and undermining the competition.

Competitor sales literature – Not reliable as they are also trying to make sales and will be exaggerating their product value and undermining the competition.

Internal sales data records – They speak to the actual numbers sold accurately but do not reflect on the quality or customer satisfaction.

Other company personnel – This should be a good source of expertise provided they do not have an interest in bringing in a competitor’s product.

Sales conventions – Information should be clear and accurate. The excitement of the atmosphere may cloud areas, but if demonstrations are able to be conducted, can be very valuable.

Team members – This should be a good source of expertise provided they do not have an interest in bringing in a competitor’s product.

Trade association magazines – Information that is issued as an article involving discussion of users, both the pros and cons is usually reliable. If it is coupled with advertising or is simply paid advertising, then it is not reliable as it is just the sales pitch of the seller.

Trade shows – Information should be clear and accurate. The excitement of the atmosphere may cloud areas, but if demonstrations are able to be conducted, can be very valuable.

External sales data sources such as warehouse withdrawals – They speak to the actual numbers sold accurately but do not reflect on the quality or customer satisfaction.

You need to assess all of the information received from each of these sources. Assessing is a process and involves knowing the purpose and use, the key features, the strengths and weaknesses, as well as the support available.
We will discuss each of these in turn.

 

 

Identify Purpose and Use of Products and Services

This must really be looked at from the customer perspective – after all, if you are trying to sell pork in the Middle East, moving even the most prime cuts will be difficult. If the customer does not want it or in the very least recognise that the product will fill their need, then it has no purpose or use for them.

Some of the features seen as desirable by customers include:

• Brand

• Colour

• Country of origin

• Covenant

• Manufacturer

• Product care details

• Safety aspects

• Shelf life

• Size

• Style

• Warnings.

Consider your customers and your product or service, and ask yourself why they would want or need it. There are two fundamental questions that need to be answered when trying to determine customer needs:

1. Why do customers’ want / buy / need it?

Here we are attempting to define the added value that the customer will attain from the product or service.

• What value will the customer attain from it?
• How will the customer experience the added benefit?

2. How do they use it?

What defining events, behaviours, moments, settings, and/or situations warrant the use of the product or service? This question identifies problems, opportunities, and environment that drives the use of the product or service. The answer to this question allows us to better answer the question of, why do they buy it?

Ensure that the needs are actually those of the customer. Often organisations can be misled by issues that are obvious and on the surface, and may seem like a need, but in reality is an element or attribute of a product or service. An example could include the stated need being food where the real need is nourishment. The stated need could be a car, but the real need is transportation.

Searching for Customer Needs

• Customer Feedback:

Customers can be asked what they want using surveys or other methods of feedback. You could look at their process flow to understand their work or uses, and to determine opportunities. You could be a customer and experience what the customer experiences.
Remember that customers cannot just be asked for what they want since they are usually unable to explicitly give an answer to what their future needs and desires will be. Instead, the customer’s discussion must be translated into a need.

• Demanded Items:

Translate the feedback to what we, as designers, think they want. This can be done using a Voice of the Customer Table (VOCT). Part 1 is to gather data about how customers are using or could be using the product or service. This data can come from interviews, questionnaires, or observation of the customer’s process in action.

Part 2 involves rewording the voice of the customer into customer demands, taking into account all of the uses described in Part I. Demands take on many forms such as demands for quality, performance, low price, long life, safety, and low environmental impact. The team must interpret these various demands from the voice of the customer, the usage, and the operating environment.

After the second part is completed, the demands from the VOCT are estimated or concluded and sorted to make later prioritisation more effective.

The following VOCT example is taken from Jack B. Revelle’s Quality Essentials: A Reference Guide from A to Z, ASQ Quality Press, 2004, pages 211 and 212.

Example for a Torch
VOCT Part 1
Voices of the Customer                                         Use
Who What When Where Why How
Easy to find during night power failure Adults and kids See during power failure Night House for basement See in the dark, check circuit Hold in hand or set on surface
VOCT Part 2
Reworded Demands Demanded Quality Quality Characteristics Function Reliability Other
Cash hold easily Cash hold easily
Can use hands-free Can use hands-free
Maintain aiming Maintain aiming
Fits in Drawer Diameter
Always ready to use Does not work

 

Analysing and Organising Demands
Reworded Demands Demanded Quality Quality Characteristics Function Reliability Other
Cash hold easily Cash hold easily
Can use hands-free Can use hands-free
Maintain aiming Can see easily Maintain aiming
Fits in Drawer Can store easily     Size Does not work
Always ready to use Does not work

 

In addition, you should be monitoring the market trends. A trend is when a particular product or service becomes a preferred object by the customer. This can be in response to many things such as a marketing endeavour (television advertising increases interest) or recessions (customers seeking cheaper alternatives).

Identify and Evaluate Key Features of Products and Services

Once you understand the customer purpose or use of the product or service, you are ready to identify and evaluate the key features of the products and services to see how they match up to the customer needs.

Start with the information on your own products or services. Read and digest the labelling and descriptions that are provided for the user and for marketing purposes. Consider the marketing and advertising – what are the key messages and who are the target audience?

Deciding what product information to promote or disregard can be difficult for marketers aiming to inform consumers about their product’s competitive advantages. However, a trade-off occurs in that consumers could be overwhelmed by technical product information, while insufficient information may lead to negative inferences that a product is inadequate. Reactions to technical product information vary, but it is proposed that difficult-to-evaluate features are discounted because of uncertainty about what value they offer. Brands can also play an integral role in balancing this risk-reducing strategy. By understanding these hypothesised reactions to difficult-toevaluate features, communications about brands may be better managed.

There are a number of factors to consider when evaluating the success of a product.

1. Does it meet the specification?

The specification covers:
• What the product must do
• Who it is made for
• Under what conditions it should operate.

You may need to consider the ‘operator’ and the ‘user’. For example, at a supermarket checkout, the customer is the ‘user’ and the person on the till is the ‘operator’.

The product has to:

• Meet the needs of the user
• Fit the environment and conditions where it will be used

This includes safety, ease of use (ergonomics), what it looks like (aesthetics), reliability, maintenance, the right price, and quality.

2. Costs

Production costs – are they within target?
Selling price – is it acceptable and did it meet the target price?

3. Checking against the competition Compare:

• Quality
• Unique features
• Selling price.

Identify and Evaluate Strengths and Weaknesses of Products and Services

Evaluation also involves assessing the strengths and weaknesses of products and services to improve their effectiveness. It provides a useful and important tool to address the need for credible information, well-grounded decision making, and transparency.

Evaluation provides needed feedback for managing any product. It uses systematic data collection and analysis to address questions about how well the products are working, whether they are achieving their objectives, and, no less importantly, why they are or are not effective.

Evaluation produces evidence that can be used to compare alternative products, guide product development and decision making, and reveal effective practices. By its very nature, it supplies the publicly accessible information that is at the heart of transparency.

Product analysis and market appraisal in terms of strengths and weaknesses, sometimes called a SWOT (strengths, weaknesses, opportunities, and threats) analysis is as fundamental as the basic market investigation.

The SWOT analysis can play an essential part in the marketing planning process. Once clearly identified, the strengths will be strongly promoted and the weaknesses in many cases can be corrected. Indeed many of them may in fact prove to be unjustified perceptions, such as ‘it always rains there’, or ‘restaurants are not good’. Generalisations are rarely true, but criticism can be very constructive in sharpening the competitive edge.

SWOT (Strengths, Weaknesses, Opportunities, and Threats)

A SWOT analysis consists of the following two activities:

• An assessment of the organisation’s internal strengths and weaknesses
• An assessment of the opportunities and threats posed by its external environment.

Assessing the Internal Environment

The internal scan of the organisation involves identification of its strengths and weaknesses, i.e, those aspects that help or hinder accomplishment of the organisation’s mission and fulfilment of its goals with respect to:
• People (human resources)
• Properties (buildings, equipments, and other facilities)
• Processes (such as production, packing, despatch, etc.)
• Products (what is sold).

Assessing the External Environment

External scanning explores the environment outside the organisation to identify opportunities and threats it faces. This involves:
• Events, trends, and forces in the Social, Technological, Economical, Environmental, and Political areas (STEEP); these would include Codes of Practice, policies and guidelines, Regulations, and relevant legislation
• Identifying the shifts in the needs of customers and potential clients
• Identification of competitors and collaborators.

After assessing these internal and external factors of an organisation, a SWOT Analysis is sketched.

The SWOT analysis is very subjective and should always be focused upon a segment of the market. This will enable you to ask ‘What are the Critical Success Factors (CSFs) that are essential to the decision-making process of the buyer in that segment?’ Weight the CSFs so that you can separate those drivers that are most important.

Complete the strengths and weaknesses from the customer’s point of view including their view in relation to the competition. This will allow you to match key CSFs to opportunities. Then rank those opportunities that are most profitable or sustainable. Finally, factor in the impact of threats.

Once your SWOT is completed, dovetail it with the rest of your strategic thinking. Some basic rules to remember:

• Be realistic about the strengths and weaknesses of the organisation
• It should distinguish between where the organisation is today and where it could be in the future
• It should always be specific – avoiding grey areas
• Always apply SWOT in relation to the competition, i.e. are we better than or worse than the competition?
• Keep the SWOT short and simple, avoid complexity and over analysis
• SWOT is subjective.

SWOT is a very popular tool with marketing teams. Questions that should be considered in each area include:

Strengths
Weaknesses
  • Price, value, and quality?
  • Morale, commitment, and leadership?
  • Advantage of proposition?
  • Disadvantages of proposition?
  • Capabilities?
  • Gaps in capabilities?
  • Financial reserves, likely returns?
  • Lack of competitive strength?
  • Competitive advantages?
  • Own known vulnerabilities?
  • USPs (Unique Selling Points)?
  • Continuity and supply chain robustness?
  • Resources, assets, and people?
  • Effects on core activities and distraction?
  • Experience, knowledge, and data?
  • Reputation, presence, and reach?
  • Innovative aspects?
  • Financials?
  • Location and geographical?
  • Timescales, deadlines, and pressures?
  • Accreditations, qualifications, and certifications?
  • Cash flow, start-up cash-drain?
  • Processes, systems, IT, and communications?
  • Reliability of data and plan predictability?
  • Cultural, attitudinal, and behavioural?
  • Accreditations, etc?
  • Management cover and succession?
  • Processes and systems, etc?
  • Management cover, succession?

 

Opportunities
Threats 
  • Industry or lifestyle trends?
  • Political effects?
  • Market developments?
  • Legislative effects?
  • Partnerships, agencies, and distribution?
  • Environmental effects?
  • Competitors’ vulnerabilities?
  • IT developments?
  • New markets, vertical, and horizontal?
  • Competitor intentions – various?
  • Technology development and innovation?
  • Market demand?
  • Global influences?
  • New technologies, services, and ideas?
  • Niche target markets?
  • Vital contracts and partners?
  • Geographical, export, and import?
  • Obstacles faced?
  • Market need for new USPs?
  • Insurmountable weaknesses?
  • Market response to tactics, e.g. surprise?
  • Employment market?
  • Major contracts and tenders?
  • Financial and credit pressures?
  • Business and product development?
  • Economy – home and abroad?
  • Information and research?
  • Seasonality and weather effects?
  • Market volume demand trends?
  • Seasonal, weather, and fashion influences?

 

Here is an example of a SWOT to help you understand the concept:
Strengths
Weaknesses
  • Excellent communication skills
  • Large distances between potential retailers
  • Exceptional customer service
  • Poor storage in current premises for production and storage of stock
  • Able to provide original and high quality product range
  • Little knowledge or experience in mass production of stock
  • Manager has completed Diploma in Business Administration and conducted indepth market research
  • Start-up finance not required
Ability to expand product range

 

Business Opportunities 
Business Threats 
  • Market research indicates: very large numbers of potential customers
  • Some craftspeople may not want to supply me with stock due to decreased profit margin
  • a trend towards ‘cottage craft’ home decorating as society becomes more environmentally aware
  • Across the board, imported home decorator products and giftware are cheaper in general than Australian made products
  • Owners of retail outlets say it is difficult to find reliable, friendly, and cost efficient suppliers
  • From market research conducted, it was found that products sold in stores are more expensive than those same products sold at specialist craft markets
  • Open a market stall to sell products direct to the public and also to see emerging trends first hand
  • At present there are no other wholesalers providing this proposed product or service, there is potential for someone to imitate this business idea within a short space of time
  • Immense number of potential raw material suppliers
  • No other suppliers in Melbourne who only sell products handmade by Australian craftspeople
  • Diversity in product range allows exploration of new outlets as preferred target market

Once key issues have been identified with your SWOT analysis, they feed into marketing objectives.

List Relevant Product and Service Support Details

Product support is a service provided by many retailers of various products, primarily electronics, that provides the end-user with a resource for information regarding the product, and help if the product should malfunction. Product support can be found in most manuals for products in the form of a phone number, website address, or physical location.

The Internet has allowed for a new form of product support to develop. Some online communities have developed to give support where manufacturer support is lacking.

While you can always refer to manuals or the Internet, if you keep a list of the common types of support questions that you are asked, it will be quicker to provide a response.

It is important to understand how the product is made, the value of the product, how the product should and can be used, and what products work well together.

You need to know:

• Pricing structure
• Styles, colours, or models available
• History of the product
• Any special manufacturing process
• How to use the product
• Product distribution and delivery
• Servicing, warranty, and repair information.

Key Points

• Information sources about products and services in a specified area must be identified and evaluated for reliability and validity

• The purpose and use of products and services must be identified

• Key features of the products and services must be identified and evaluated

• Strengths and weaknesses of the products and services must be identified and evaluated

• The relevant product and service support details must be listed.