A Presentation by:-•Chandan Jagtap•Sachin Methree•Ajit Mangarulkar•Nikhil Kadam•Umesh Panaskar
Causes of New Product Failures •Overestimation of Market Size •Poor quality of products •Non delivery of promised benefits of product •Product Incorrectly Positioned •Rapid change in economy •Too little marketing support •To create successful new products, the company must: understand it’s customers, markets and competitors develop products that deliver superior value to customers.
New Product Development Process Idea Generation and Screening Concept Development and Testing Marketing Strategy Business Analysis Product Development Test Marketing Commercialization
New Product Development ProcessStep 1. Idea Generation Systematic Search for New Product Ideas •Internal sources •Customers •Competitors •Distributors •Suppliers
New Product Development ProcessStep 2. Idea Screening Process to spot good ideas and drop poor ones Criteria • Market Size • Product Price • Development Time & Costs • Manufacturing Costs • Rate of Return
New Product Development Process Step 3. Concept Development & 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
New Product Development Process Step 4. Marketing Strategy DevelopmentMarketing Strategy Statement Formulation Part One - Overall: Target Market Planned Product Positioning Sales & Profit Goals Market Share Part Two - Short-Term: Product’s Planned Price Distribution Marketing Budget Part Three - Long-Term: Sales & Profit Goals Marketing Mix Strategy
New Product Development ProcessStep 5. Business AnalysisStep 6. 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
New Product Development ProcessStep 7. Test Marketing Standard Test Market Controlled Test Market Full marketing campaign in a small number of A few stores that have representative cities. agreed to carry new products for a fee. Simulated Test Market Test in a simulated shopping environment to a sample of consumers.
New Product Development ProcessStep 8. Commercialization Commercialization (often considered post- NPD) Company decide the introduction timing. Company decide where to launch the product. Primary target consumer group will have been identified earlier in research and test marketing.
Conclusion•These steps may be iterated as needed.•To reduce the time that the NPD process takes, manycompanies are completing several steps at the same time(referred to as concurrent engineering or time tomarket) • Many industry leaders see new product development as an ongoing process (referred to as continuous development) in which the entire organization is always looking for opportunities.