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   Overestimation of Market Size   Product Design Problems   Product Incorrectly Positioned, Priced or    Advertised  ...
   Idea Generation and Screening   Concept Development and Testing   Marketing Strategy   Business Analysis   Product...
New Product Development ProcessNew Product Development ProcessStep 1. Idea GenerationStep 1. Idea Generation    Systematic...
New Product Development ProcessNew Product Development ProcessStep 2. Idea ScreeningStep 2. Idea Screening    Process to ...
New Product Development ProcessNew Product Development ProcessStep 3. Concept Development & TestingStep 3. Concept Develop...
New Product Development ProcessNew Product Development ProcessStep 4. Marketing Strategy DevelopmentStep 4. Marketing Stra...
New Product Development ProcessNew Product Development ProcessStep 5. Business AnalysisStep 5. Business AnalysisStep 6. Pr...
New Product Development ProcessNew Product Development ProcessStep 7. Test MarketingStep 7. Test Marketing             Sta...
Sales andProfits ($)                                                     Sales                                          Pr...
Sales      Sales                     Low sales                                Low sales      Costs      Costs             ...
Growth Stage of the PLC        Sales        Sales                Rapidly rising sales                             Rapidly ...
Maturity Stage of the PLC         Sales         Sales                       Peak sales                                    ...
Decline Stage of the PLC         Sales         Sales                    Declining sales                                  D...
New product-development
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New product-development

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Product or service is designed/ manufactured in such a way that marketing efficiency and effectiveness is dependent.

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New product-development

  1. 1.  Overestimation of Market Size Product Design Problems Product Incorrectly Positioned, Priced or Advertised Costs of Product Development Competitive Actions To create successful new products, the company must: › understand it’s customers, markets and competitors › develop products that deliver superior value to customers.
  2. 2.  Idea Generation and Screening Concept Development and Testing Marketing Strategy Business Analysis Product Development Test Marketing Commercialization
  3. 3. New Product Development ProcessNew Product Development ProcessStep 1. Idea GenerationStep 1. Idea Generation Systematic Search for New Product Ideas Internal sources Customers Competitors Distributors Suppliers
  4. 4. New Product Development ProcessNew Product Development ProcessStep 2. Idea ScreeningStep 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
  5. 5. New Product Development ProcessNew Product Development ProcessStep 3. Concept Development & TestingStep 3. Concept Development & Testing 1. Develop Product Ideas into 1. Develop Product Ideas into Alternative Alternative Product Concepts Product Concepts 2. Concept Testing --Test the 2. Concept Testing Test the Product Concepts with Groups Product Concepts with Groups of Target Customers of Target Customers 3. Choose the Best One 3. Choose the Best One
  6. 6. New Product Development ProcessNew Product Development ProcessStep 4. Marketing Strategy DevelopmentStep 4. Marketing Strategy Development Marketing Strategy Statement Formulation Part One -- Overall: Part One Overall: Target Market Target Market Planned Product Positioning Planned Product Positioning Sales & Profit Goals Sales & Profit Goals Market Share Market Share Part Two -- Short-Term: Part Two Short-Term: Product’s Planned Price Product’s Planned Price Distribution Distribution Marketing Budget Marketing Budget Part Three -- Long-Term: Part Three Long-Term: Sales & Profit Goals Sales & Profit Goals Marketing Mix Strategy Marketing Mix Strategy
  7. 7. New Product Development ProcessNew Product Development ProcessStep 5. Business AnalysisStep 5. Business AnalysisStep 6. Product DevelopmentStep 6. Product Development Business Analysis Business Analysis Review of Product Sales, Costs, Review of Product Sales, Costs, and Profits Projections to See if and Profits Projections to See if They Meet Company Objectives They Meet Company Objectives If No, Eliminate If No, Eliminate Product Concept Product Concept If Yes, Move to If Yes, Move to Product Development Product Development
  8. 8. New Product Development ProcessNew Product Development ProcessStep 7. Test MarketingStep 7. Test Marketing Standard Standard Controlled Test Market Controlled Test Market Test Market Test Market Full marketing campaign Full marketing campaign A few stores that have A few stores that have in a small number of in a small number of agreed to carry new agreed to carry new representative cities. representative cities. products for a fee. products for a fee. Simulated Simulated Test Market Test Market Test in a simulated Test in a simulated shopping environment shopping environment to a sample of to a sample of consumers. consumers.
  9. 9. Sales andProfits ($) Sales Profits Time Product Introduction Growth Maturity Decline Develop- mentLosses/Investments ($)
  10. 10. Sales Sales Low sales Low sales Costs Costs High cost per customer High cost per customer Profits Profits Negative NegativeMarketing Objectives Create product awareness Create product awarenessMarketing Objectives and trial and trial Product Product Offer a basic product Offer a basic product Price Price Use cost-plus Use cost-plus Distribution Distribution Build selective distribution Build selective distribution Advertising Advertising Build product awareness among Build product awareness among early adopters and dealers early adopters and dealers
  11. 11. Growth Stage of the PLC Sales Sales Rapidly rising sales Rapidly rising sales Costs Costs Average cost per customer Average cost per customer Profits Profits Rising profits Rising profits Marketing Objectives Marketing Objectives Maximize market share Maximize market share Product Product Offer product extensions, Offer product extensions, service, warranty service, warranty Price Price Price to penetrate market Price to penetrate market Distribution Distribution Build intensive distribution Build intensive distribution Advertising Advertising Build awareness and interest in Build awareness and interest in the mass market the mass market
  12. 12. Maturity Stage of the PLC Sales Sales Peak sales Peak sales Costs Costs Low cost per customer Low cost per customer Profits Profits High profits High profits Marketing Objectives Marketing Objectives Maximize profit while defending Maximize profit while defending market share market share Product Product Diversify brand and models Diversify brand and models Price Price Price to match or best Price to match or best competitors competitors Distribution Distribution Build more intensive distribution Build more intensive distribution Advertising Advertising Stress brand differences and Stress brand differences and benefits benefits
  13. 13. Decline Stage of the PLC Sales Sales Declining sales Declining sales Costs Costs Low cost per customer Low cost per customer Profits Profits Declining profits Declining profits Marketing Objectives Marketing Objectives Reduce expenditure and milk the Reduce expenditure and milk the brand brand Product Product Phase out weak items Phase out weak items Price Price Cut price Cut price Distribution Distribution Go selective: phase out Go selective: phase out unprofitable outlets unprofitable outlets Advertising Advertising Reduce to level needed to retain Reduce to level needed to retain hard-core loyal customers hard-core loyal customers

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