Product Service Management (PSM) is a marketing function that focuses on improving a product or service in response to changes in the market. It involves continual evaluation of the features of a product or service to ensure that it is meeting the needs of customers and staying competitive within the market.
Introduction to Product Service Management
A product service manager is responsible for overseeing the product and service development, ensuring quality, and customer satisfaction.
The goal of PSM is to increase customer loyalty and ensure that products are flexible to changing market conditions. It also involves product innovation, constant control and management of products, and three phases; developing new products, monitoring existing products, and eliminating weak products. All of these aspects are crucial to the success of any company or organization.
What is a Product Service Manager?
A product service manager is a professional who is responsible for managing the development and delivery of products and services to customers. They are in charge of managing product roadmaps, conducting market research and analysis to identify business opportunities, collecting and evaluating customer reviews, and managing different departments to develop new products for the market.
Furthermore, a product service manager must lead and inspire their workforce to accomplish their goals while adhering to the company’s policies and procedures. Their responsibilities include developing new products, monitoring existing products, and eliminating weak products.
By properly implementing product service management, companies can build customer loyalty, increase flexibility to changing market conditions and customer demands, foster product innovation, and gain more chances to increase sales and profits.
The responsibilities of a Product Service Manager are
The responsibilities of a Product Service Manager are to manage the product and service development, ensure quality, and guarantee customer satisfaction. This includes overseeing product roadmaps, conducting market research and analysis, collecting customer reviews, and managing the different departments that develop new products.
It also requires leading and inspiring their workforce to accomplish their goals while adhering to the company’s policies and procedures. In addition, the manager must be able to recognize potential business opportunities, adapt products to customer needs, make decisions regarding product selection, and maintain control over products while responding to changing market conditions.
Product Service Managers must also monitor existing products, identify weak products, and plan for product discontinuation. All of these are essential for companies to provide quality product management and be successful in any industry.
The advantages of Product Service Management
Nowadays, managing products and services requires coordinating a whole bunch of complex marketing activities, like product selection and evaluation, technological testing, market analysis, trial sales, advertisement sales support, etc.
By successfully implementing marketing strategies, you have the ability to change the company’s future for the better. Additionally, product service management provides the following benefits:
Higher customer loyalty
This is an essential objective for any business, and it’s frequently accomplished by constructing a solid rapport with customers. Product service management assesses ways of forming long-term relationships by providing customized services that are designed to meet customers’ individual needs. Furthermore, it creates products that will exceed their expectations in terms of quality at different prices.
More flexible to changing market conditions and customer demands
Product service management allows companies to be more flexible to changing market conditions and customer demands. This helps companies adjust their products and services to meet the needs of their customers and remain competitive.
Companies can use product service management to analyze customer feedback and develop products that meet their needs and expectations. Companies can also use product service management to track market trends and adjust their products accordingly.
Product service management also helps companies identify opportunities for improvement and innovate new products that are tailored to customer needs.
Product innovation
Product innovation is an important part of product service management. Companies can stay competitive and remain relevant by constantly introducing new products and services, as well as improving existing ones.
Product innovation helps companies to better meet customer needs, develop better products, and stay ahead of the competition. Companies can use market research to identify customer needs and provide solutions that meet those needs.
They can use concept testing to gauge customer reactions to potential products before investing heavily in developing them. Companies can also use feasibility analyses to ensure that their new products will be profitable and successful. By utilizing product innovation, companies can have an edge over their competitors and increase customer loyalty.
Proper management and control of products gives more opportunities to increase sales and profits
Product service management is essential for any business that wants to be successful. By constantly controlling and managing products, companies can increase their sales and profits. This is done by evaluating their quality, improving existing products, and introducing new products to the market.
Product service managers must also keep a close eye on the market and customer needs in order to make informed decisions about product changes. They must be flexible and quick to respond to changing market conditions and customer demands.
Ultimately, by making the most profitable product-mix decisions possible, companies can ensure their success and increase their sales and profits.
The Three Stages of Product Service Management
1. New Product Development
Companies invest a lot of money, time, and effort developing new products to offer to their customers. New products may be goods or services that:
You can see that some products are entirely new to the market. Even older products can be seen as “new” again in this process. For example, an established soft drink may have a “new, improved” formula or taste. Another example would be cosmetics, such as lipstick, which may have been on the market for years, but received completely.
There are various ways businesses can obtain new products. They could buy them from another person or company, license them from another person or organization (essentially paying for the ability to sell a product but not owning it), acquire them through purchasing another company, or develop them in-house.
Let’s explore the fundamental steps of internal product development. Keep in mind that an idea or potential product can be scrapped at any point during this process if the company or product/service managers determine that it won’t make a positive contribution to the product/service mix or won’t be profitable.
Generating ideas: A plethora of sources can give you inspiration for new products—employees, customers, sales representatives, retailers, friends, family members— anybody! You might need to generate hundreds of ideas before you find a great one for new-product development. Some companies have product-management committees that meet on a regular basis to come up with new-product ideas. Every idea must go through a screening.
Screening ideas: The goal of screening new-product ideas is to weed out any that will likely be unviable. Therefore, top-level managers from various departments (finance, engineering, distribution, etc.) are often involved in this stage. Even if an idea looks good on paper, it may not be possible to execute it due to financial constraints, a history of failed attempts, or a misalignment with a company’s goals and objectives.
Test your product concept. If an idea passes the screening process, it’s time to get feedback from possible customers about the potential product. Concept testing should answer the following questions:
- Will our target market be interested in this product??
- Is it the right time to introduce this?
- What advantages does our target market hope to gain from this product??
Concept testing can entail a basic customer questionnaire or, in other instances, an actual prototype of the product. Being judicious at this stage of the new-product development process is essential because continuing to develop a product requires a more substantial financial investment from the company.
Perform a business or feasibility analysis: This is a comprehensive analysis that takes various factors into consideration, such as demand, costs, competition, required investment, and potential profit. Different departments’ managers will likely contribute to this stage of the process. The feasibility analysis is a more in-depth and earnest screening step. It might take several months to finish. If a company decides that the product is achievable at the current time, it will take additional steps to bring it to fruition.
Developing the product. Product development is a long and extensive process that could take months or even years to complete. In this stage, a working model of the product is tried out, modified, and retested until the company decides if it’s ready to be released. The cost of production is estimated and plans for packaging, labeling, brand name, promotion, and distribution are made.
Try the product out in a test: Test marketing is when you introduce a product to a limited market to see how it will do. It helps product/service managers plan out actual marketing strategies. We test the product in specific locations to get reactions from customers and retailers before starting wider distribution. Based on the test market, product changes can be made, or if the test market results are bad, the product might be discontinued.
Not every new product requires test marketing. In some instances, it may not be used because it can be pricey, slow down the process of entering the market, provide an unreliable depiction of results, offer no guarantee of success, and give competitors a chance to copy the concept while it’s being tested..
Product Commercialization: If a product has made it through all of the other steps in the new-product development process, it is now ready to be commercialized. The product enters full-scale production, a marketing strategy is being developed, service and sales training is being performed, and the product life cycle begins.
2. Existing Product Monitoring
Existing product monitoring is an important part of product service management. It involves tracking the revenue, profits, market share, and performance of products that have already been released. It helps product service managers make informed decisions about which products are most successful and which ones need to be improved or discontinued.
The process requires regular monitoring and evaluation to ensure that products remain competitive and profitable. Product/service managers also identify new opportunities to improve existing products and analyze customer feedback to ensure they are meeting customer needs. This type of management helps companies stay ahead of their competition and maximize their profits.
3. Weak Product Elimination
Product elimination is an essential part of product service management, as it allows companies to stay competitive and make the most profitable decisions by removing weak or unprofitable products from their product mix. This process involves making a careful plan to avoid damaging a company’s reputation, and it can be done quickly or over a set period of time.
Companies must make sure to phase out weak products slowly to give customers time to find alternatives, or continue to offer service for a discontinued product for a set period of time. Product/service managers must weed out any weak products, as they can be costly to the company. Ultimately, product elimination is an important part of product service management that allows businesses to make the most profitable decisions and stay ahead of the competition.
Conclusion
Product service management is an essential and integral part of any company’s success. It helps companies to stay competitive and keeps them up to date with customer expectations, market trends, and technological advancements. Product service managers are responsible for developing, monitoring, and eliminating products,
all in an effort to provide the best goods and services for their customers. By properly managing their products and services, companies can increase customer loyalty, remain flexible to ever-changing conditions, innovate and improve on existing products, and ultimately increase sales and profits. As such, it is evident that product service management is an invaluable asset to businesses of all sizes.
Frequently Asked Questions About The Role of Product Service Management in Marketing
What Is The Role Of Product Service Management In Marketing?
Product service management (also known as product/service management) is the process of tailoring a company’s offerings to customer demands that come from changes in the market. A product service manager (PSM) tries to predict customer needs and then manages product development
Who Manages New Product Development?
The product/service manager is typically responsible for managing new product development. The manager will work with a team of professionals including designers, engineers, marketing experts, and more to develop the product and bring it to market.
What is New Product Development (NPD)?
New Product Development (NPD) is the process of designing, creating, and introducing new products to the market. It involves understanding customer needs, researching and developing products that meet those needs, and bringing them to the market.
