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it’s good and
good for you
Slide 9.1
Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
New product development and...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
New product development str...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
New product development pr...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
• Marketing strategy devel...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Business analysis involves...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
• Involves the creation an...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Test marketing is the stag...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
New product development pr...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
• Advantages of simulated ...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
New product development pr...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
New product development pr...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Managing new product
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Managing new product
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Managing new product
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Managing new product
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Managing new product
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Product life-cycle strateg...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
• Product development
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Product life-cycle strateg...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Additional product and ser...
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Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013
Additional product and ser...
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PoM 6th ed. chapter 09

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Developing new products and managing the product life cycle

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PoM 6th ed. chapter 09

  1. 1. it’s good and good for you Slide 9.1 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Chapter 9 Developing new products and managing the product life cycle
  2. 2. Slide 9.2 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development and product life-cycle strategies • New product development strategy • New product development process • Managing new product development • Product life-cycle strategies • Additional product and service considerations Topic outline
  3. 3. Slide 9.3 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development strategy Acquisition refers to the buying of a whole company, a patent or a license to produce someone else’s product. New product development refers to the development of original products, product improvements, product modifications and new brands through the firm’s own product development efforts. Two ways to obtain new products
  4. 4. Slide 9.4 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process Major stages in new product development Figure 9.1 Major stages in new-product development
  5. 5. Slide 9.5 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Idea generation is the systematic search for new product ideas. Sources of new product ideas • Internal • External Idea generation
  6. 6. Slide 9.6 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Internal sources refer to the company’s own formal research and development, management and staff, and intrapreneurial programs. External sources refer to sources outside the company such as customers, competitors, distributors, suppliers and outside design firms. Idea generation
  7. 7. Slide 9.7 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Inviting broad communities of people— customers, employees, independent scientists and researchers and even the public at large—into the new product innovation process. Crowdsourcing
  8. 8. Slide 9.8 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) • Identify good ideas and drop poor ideas. • R-W-W screening framework: – Is it real? – Can we win? – Is it worth doing? Idea screening
  9. 9. Slide 9.9 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Product idea is an idea for a possible product that the company can see itself offering to the market. Product concept is a detailed version of the idea stated in meaningful consumer terms. Product image is the way consumers perceive an actual or potential product. Concept development and testing
  10. 10. Slide 9.10 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Concept testing refers to testing new product concepts with a group of target consumers to find out if the concepts have strong consumer appeal. Concept development and testing
  11. 11. Slide 9.11 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 • Marketing strategy development involves designing an initial marketing strategy for a new product based on the product concept. • Marketing strategy statement includes: – Description of the target market – Value proposition – Sales and profit goals. Marketing strategy development New product development process (Continued)
  12. 12. Slide 9.12 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Business analysis involves a review of the sales, costs and profit projections to find out whether they satisfy the company’s objectives. Marketing strategy development New product development process (Continued)
  13. 13. Slide 9.13 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 • Involves the creation and testing of one or more physical versions by the R&D or engineering departments. • Requires an increase in investment. • Shows whether the product idea can be turned into a workable product. Marketing strategy development Product development New product development process (Continued)
  14. 14. Slide 9.14 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Test marketing is the stage at which the product and marketing program are introduced into more realistic marketing settings. Provides the marketer with experience in testing the product and entire marketing program before full introduction. Marketing strategy development New product development process (Continued)
  15. 15. Slide 9.15 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Types of test markets Standard test markets Controlled test markets Simulated test markets
  16. 16. Slide 9.16 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 • Advantages of simulated test markets – Less expensive than other test methods – Faster – Restricts access by competitors. • Disadvantages – Not considered as reliable and accurate due to the controlled setting. Marketing strategy development New product development process (Continued)
  17. 17. Slide 9.17 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Marketing strategy development When firms test market • New product with large investment • Uncertainty about product or marketing program When firms may not test market • Simple line extension • Copy of competitor product • Low costs • Management confidence
  18. 18. Slide 9.18 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 New product development process (Continued) Commercialisation is the introduction of the new product • When to launch • Where to launch • Planned market rollout Marketing strategy development
  19. 19. Slide 9.19 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Managing new product development Successful new product development should be: • customer-centred • team-based • systematic.
  20. 20. Slide 9.20 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Managing new product development (Continued) Customer-centred new product development: new ways to solve customer problems and create more customer satisfying experiences. New product development strategies
  21. 21. Slide 9.21 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Managing new product development (Continued) Sequential new product development: company departments work closely together individually to complete each stage of the process before passing it along to the next department or stage. • Increased control in risky or complex projects but may be slow. New product development strategies
  22. 22. Slide 9.22 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Managing new product development (Continued) Team-based new product development: Various company departments work closely together, overlapping the steps in the product development process to save time and increase effectiveness. New product development strategies
  23. 23. Slide 9.23 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Managing new product development (Continued) Systematic new product development: innovative development approach that collects, reviews, evaluates and manages new product ideas. • Creates an innovation-oriented culture. • Yields a large number of new product ideas. New product development strategies
  24. 24. Slide 9.24 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies Product life cycle Figure 9.2 Sales and profits over the product’s life from inception to decline
  25. 25. Slide 9.25 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 • Product development – Sales are zero and investment costs mount. • Introduction – Slow sales growth and profits are nonexistent. • Growth – Rapid market acceptance and increasing profits. • Maturity – Slowdown in sales growth and profits level off or decline. • Decline – Sales fall off and profits drop. Product life-cycle strategies (Continued)
  26. 26. Slide 9.26 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) Figure 9.3 Styles, fashions and fads
  27. 27. Slide 9.27 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) Fads are temporary periods of unusually high sales driven by consumer enthusiasm and immediate product or brand popularity.
  28. 28. Slide 9.28 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) • Slow sales growth • Little or no profit • High distribution and promotion expense. Introduction stage
  29. 29. Slide 9.29 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) • Sales increase • New competitors enter the market • Price stability or decline to increase volume • Consumer education • Profits increase • Promotion and manufacturing costs gain economies of scale. Growth stage
  30. 30. Slide 9.30 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) • Slowdown in sales • Many suppliers • Substitute products • Overcapacity leads to competition • Increased promotion and R&D to support sales and profits. Maturity stage
  31. 31. Slide 9.31 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) • Market modifying • Product modifying • Marketing mix modifying Maturity stage modifying strategies
  32. 32. Slide 9.32 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Product life-cycle strategies (Continued) • Maintain the product • Harvest the product • Drop the product Decline stage
  33. 33. Slide 9.33 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Additional product and service considerations Public policy and regulations regarding developing and dropping products, patents, quality and safety. Product decisions and social responsibility
  34. 34. Slide 9.34 Kotler et al., Principles of Marketing, 6th edition © Pearson Education Limited 2013 Additional product and service considerations (Continued) • Determining what products and services to introduce in which countries • Standardisation versus customisation • Packaging and labelling • Customs, values and laws. International product and service marketing—challenges

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