Development of new product

Development of new product

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  Development of New Product
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  New product development(NDP)  NDP is a process which designed to develop, test and consider the viability of products which are new to the market in order to ensure the Growth or survival of the organisation.
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  New Product Importance  Company . . .  Societal . . .  Sales Revenue  Create jobs  Replace “fading products”  Increase standard of living  Spread Risk  Increase competition  Innovate or Die
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  Categories of NewProducts  Creates New Market with Radically New Product or Product Line.  Enters Existing But Not Previously Targeted Market with New-Product or Product Line.  Stays in Existing and Previously Targeted Market by Enhancing Existing Product or Product Line.
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  The New-Product PLANNING 1. IDEA GENERATION PROCESS 2. IDEA 3. Concept 4. BUSINESS SCREENING Development & ANALYSIS Testing 5. PRODUCT DEVELOPMENT 6. TEST 7. COMMERCIALIZATION MARKETING
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  Step 1. IdeaGeneration: An ongoing search for product ideas to be consistent with target market needs and the organization’s goals Sources of Product Ideas sources Internal Customers Competitors Distributors Suppliers Product idea Principle: Set the climate for innovation
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  Step 2. IdeaScreening  Process to spot good ideas and drop poor ones.  Criteria-  Market Size,  Product Price,  Development Time & Costs,  Manufacturing Costs &  Rate of Return.
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  Step 3. ConceptDevelopment & Testing 1. Develop Product Ideas into Alternative Product Concepts 2. Concept Testing - Test the Product Concepts with Groups of Target Customers 3. Choose the Best One
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  Step 4. BusinessAnalysis Step 5. Product Development Business Analysis Review of Product Sales, Costs, and Profits Projections to See if They Meet Company Objectives If No, Eliminate Product Concept If Yes, Move to Product Development
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  Step 6. TestMarketing Standard Test Market Controlled Test Market Full marketing campaign A few stores that have in a small number of agreed to carry new representative cities. products for a fee. Simulated Test Market Test in a simulated shopping environment to a sample of consumers.
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  Step7.Commercialization Stage  Offer the product with commitments of full scale resources and effort  Decisions:  Timing -When? Seasonal influences?)  Geographical strategy -Where? Weather?  Target markets  Marketing mix strategies (4p’s)
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  Causes of NewProduct Failures  Overestimation of Market Size.  Product Design Problems.  Product Incorrectly Positioned, Priced or Advertised.  Costs of Product Development.  Competitive Actions.
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