University of Southern California Marshall School of Business MKT 445: New Product Development and Branding Syllabus: Spring

2013

Professor Matthew Selove Office: HOH 803 Office Phone: 213-740-6948 E-mail: selove@marshall.usc.edu Class Times and Locations: Tue., Thurs. 4:00 PM - 5:50 PM Tue., Thurs. 6:00 PM - 7:50 PM Office Hours: Immediately after class (or by appointment) Overview This course addresses two of the most important problems companies face: how to develop successful new products, and how to build and sustain brands. It will be useful to students interested in a wide range of careers, including marketing research managers, product managers, entrepreneurs, and consultants. The first part of the course, on new product tactics, will cover interview techniques for understanding customers needs, quantitative market research methods for measuring customer preferences, and ways of predicting how successful a product will be if it is launched. The second part, on new product strategy, will focus on analyzing a companys unique resources to decide which types of products it should develop. We will also address how to develop new resources, and how to respond to products developed by innovative new competitors. The third part, on branding, will study how to build and sustain brands, when to extend an existing brand to cover a new product, and when to launch an entirely new brand.

HOH 305 HOH 305

(Section 16492R) (Section 16493R)

Prerequisite: BUAD 307 - Marketing Fundamentals

Required Text: Course Reader

Grading 30% Midterm exam 1 30% Midterm exam 2 30% Final team project 10% Class participation An individual one-page write-up is due prior to each case discussion (you choose 4 out of the 5 cases to write up). Please see more details in the section on Case Discussions below.

Definition of Letter Grades In a typical section the average grade is between B and B+. Following is how final letter grades are determined for a typical section: A Near-perfect performance in every component of the class. In the past, very few students have received this grade. Overall performance that is substantially above the class average. Note that bad performance in one part of the class can offset good performance in another part. For example, a student who is substantially above average on both midterms, but below average in participation and below average on the final project will typically receive a grade of B+ or lower. Similarly, a student who is substantially above average in participation and on the final project, but below average on the midterms would also typically receive a grade of B+ or lower. Overall performance that is slightly above average. Because most students work hard and do a good job in the course, average performance is quite good, and I consider a B+ a good grade. Overall performance that is average or somewhat below average. For example, a student whose midterm grades are slightly below average, whose participation is well below average, and whose final team project is average would typically receive a B-. Overall performance that is significantly below the class average. For example, a student whose midterm scores are near the bottom of the class, and who participates rarely, and whose final project is average would typically receive a C-. Overall performance that is unacceptably low. Also given to students who do not turn in some assignments, or who repeatedly fail to contribute to the team project. For example, a student who misses one of the midterms (and does not schedule a make-up with me in a timely manner), but completes all other assignments, would typically receive a D, while a student who misses one midterm and also does not join a final project team would typically receive an F.

A-

B+

B, B-, C+

C, C-

D, F

Midterm Exams There will be two midterm exams. The exam questions will be based on material from the lectures and cases. I will hold an in-class review before each midterm, and I will also provide you with detailed information about each midterm a couple of weeks before the date it is scheduled. If you cannot attend class during the date of a midterm, you must submit a written signed excuse (for example, from a doctor) explaining why. We will then schedule a make-up midterm. Typically most students perform quite well on the midterms, so if you want to be above average your midterm scores have to be perfect or almost perfect. Based on past experience, here are how typical midterm letter grades are determined: Typical midterm letter grades based on percentage of midterm questions answered correctly (NOTE: This may change from year to year) 100%: A 96%: A92%: B+ 88%: B 84%: B80%: C+ 76%: C 72%: C-

Case Discussions There are five case discussions. For each case, the class schedule (see below) lists questions you should think about as you read the case. For 4 out of the 5 cases (of your choice), you should then submit a one-page write-up (double spaced) answering these questions on Blackboard prior to the start of class. The purpose of these write-ups is to make sure that everyone is well-prepared, so that we can have a productive discussion. Many of the questions do not have a clear right or wrong answer, and I will not grade these write-ups. However, at the end of the semester I will check that everyone has done 4 write-ups and has put in a reasonable level of effort. If it appears that you have exerted very low effort, I will e-mail you and give you a choice between accepting a penalty to your final grade or (to avoid this penalty) submitting another, longer write-up on the cases for which your write-ups were not acceptable. If you do not receive such an email from me, then your write-ups are fine.

Final Team Projects

You should join a team of between 3 and 5 people who are all in the same section. Teams of 6 are not allowed because previous experience has shown it is difficult to manage such large teams and ensure that everyone contributes.

Project deadlines: April 9: One-paragraph project proposals are due by e-mail. April 25 and 30: In-class project presentations (15-minutes per team) will take place. May 2: Presentation write-ups are due at the start of class. Please e-mail me a copy and also bring a hard copy to class. The write-up should be 6 to 8 pages (double-spaced). The purpose of the page limit is to force you to focus on the key points and make your points concisely. Teams that use single-spacing or exceed the page limit will be penalized with a reduction in their grade. Your write-up may include an appendix with additional charts and figures, which do not count toward the page limit. You should cite any sources of information used as the basis of your report, such as books, newspaper articles, web pages, and personal interviews.

Team Project Topic: New Product Proposal 1. Choose a company (not one from the class case discussions). 2. Provide a brief overview of the company: when it was founded; recent revenues and profits; key products; types of customers it serves. 3. Describe at least 3 important resources the company has: What makes each resource valuable? What makes it difficult to imitate? 4. Choose at least one key competitor and describe how its resources are different than those of the focal company. 5. Based on this analysis of resources, come up with an idea for a new product the company could launch. This product can be new to the world, new to the firm, or an extension or improvement of an existing product line. 6. Describe market research that you would conduct before launching the product. Discuss how you would use at least one qualitative method (e.g. interviews, ZMET) and at least one quantitative method (e.g., surveys, perceptual mapping, conjoint analysis, ASSESSOR). 7. Describe how the results of your market research might change your plans for the new product. In what cases would the results cause you to abandon the product idea? How might you change product features in response to the market research?

Team Management: An important goal of the team project is to give you experience working in groups. All members of a team will receive the same grade for the project; however, it is important for everyone to contribute and be a reliable teammate. If a particular teammate is not meeting expectations, then you should first address that person directly, and ask him/her to take the project more seriously. If this does not work, then you may let me know. In extreme cases, I will allow a team to remove a teammate, or I may reduce the class grade of someone who is not contributing.

Class Schedule Introduction Tue. 1/15 Course Overview

Part 1. New Product Tactics Thurs. 1/17 Tue. 1/22 Understanding Customer Needs Generating New Product Ideas Perceptual Mapping Case Discussion: Johnson Wax: Enhance (A) Case questions for one-page write-up: (1) What customer needs are served by the new Enhance product? (2) What information about Enhance do respondents have when they decide which brand to purchase in the lab study? (3) What additional information do they have when they decide whether to make a repeat purchase? (4) Given the results of the ASSESSOR test, what course of action would you recommend to Johnson Wax? Conjoint Analysis Messenger Bag Game At least one member of your team should bring a laptop computer to class. Messenger Bag Game: Results and Discussion Concept Testing Concept Testing: Results and Discussion

Thurs. 1/24 Tue. 1/29

Thurs. 1/31 Tue. 2/5

Thurs. 2/7 Tue. 2/12

Thurs. 2/14

Part 2. New Product Strategy Tue. 2/19 Introduction to Resources (TBA) Company Resources: In-class mini-case discussions Review for Midterm 1 Midterm Exam 1 Case Discussion: Google, Inc. Case questions for one-page write-up: (1) What are Googles resources? (2) What new products is Google developing? (3) Will its current resources allow Google to be successful with these new products? Developing New Resources Case Discussion: Real Madrid Club de Futbol Case questions for one-page write-up: (1) What are Real Madrids resources? (2) What investments do they need to make to sustain these resources? (3) Should Real Madrid try to develop a large fan base in the United States? Spring Break Spring Break Responding to Innovative New Competitors Case Discussion: eReading: Amazon's Kindle Case questions for one-page write-up: (1) Name three companies that are threatened by the Kindle, and describe how the Kindle could hurt their business. (2) How should each of these companies respond to this threat?

Thurs. 2/21 Tue. 2/26

Thurs. 2/28 Tue. 3/5

Thurs. 3/7

Tue.

3/12

Thurs. 3/14

Tue.

3/19

Thurs. 3/21 Tue. 3/26

Thurs. 3/28

Part 3. Branding Tue. 4/2 Building and Sustaining Brands Case Discussion: Burberry Case questions for one-page write-up: (1) What challenges did the Burberry brand face in 1997? (2) How did the new management team address these challenges?

Thurs. 4/4

Tue.

4/9

Choosing a Name, and Extending Brands Each team should e-mail me (selove@marshall.usc.edu) a project proposal with: - Names of all team members. - A one-paragraph description of your project idea.

Thurs. 4/11 Tue. 4/16

Review for Midterm 2 Midterm Exam 2

Conclusion Thurs. 4/18 Tue. 4/23 Pricing, part 1 Pricing, part 2 Student Presentations of Team Projects Student Presentations of Team Projects Course Wrap-up Team projects are due at the start of class. Please e-mail me a copy and also bring a hard copy to class.

Thurs. 4/25 Tue. 4/30

Thurs. 5/2

Order of Readings in Course Reader Johnson Wax: Enhance (A) Google, Inc. Real Madrid Club de Futbol eReading: Amazon's Kindle Burberry HBS Case 9-583-046 HBS Case 9-910-036 HBS Case 9-504-063 HBS Case 9-709-486 HBS Case 9-504-048