The document discusses various aspects of new product development including defining a product, the product mix, product differentiation, the product life cycle, and the new product development process. It explains key terms like the core, actual, and augmented product. It also outlines the different stages in the new product development process from idea generation to commercialization and launch.

1. PRESENTED BY
SOMDEEP KUMAR SEN

2.  A product is anything that has the capacity
to satisfy customer’s need/want/demand
 A product is anything offered for attention,
use or consumption that might satisfy the
need/want/demand
 The term product covers both goods and
services

3.  The core product – the core benefit that
satisfies the consumer’s need
 The actual product – the specific product
offering designed to satisfy the need
 The augmented product – additional bundle
of benefits

4.  Core product benefit: Transportation
 Actual product: The car itself – design, styling,
quality, performance, reliability, etc.
 Augmented product: Warranty, Extended
warranty, credit, zero % finance, etc.

5.  The product mix is the set of all products
offered for sale by a company
 A product mix has two dimensions:
 Breadth - the number of product lines
carried.
 Depth - the variety of sizes, colors, and
models offered within each product line
 A product line is a broad group of
products, intended for similar uses and
having similar characteristics.

6. Product Line- I Product Line- II Product Line - III
Bath Soap Detergent Beverage
•Dove
•Lirl
•Lux
•Pears
•Rexona
•Lifebuoy
•Hamam
•Jai
•Breeze
•Moti
•Surf
•Rin
•Wheel
•Sunlight
•501
•Bru
•Brook-Bond
•Taaza
•Tajmahal
ProductDepth
Product Breadth

8. LINE STRECHING
 Whenever the marketer feels that they can increase the profit by either adding
or dropping items from the product line, it is called Line stretching
 Line Stretching can be both- upward or downward
 Downward Stretching – P & G’s “Ariel” detergent begun at a premium end
& then down stretched to lower market segment by introducing “Ariel Bar”
 Upward Stretching- HUL’s Lifebuoy started as a hygienic bath soap, but later
moved to premium segment as HUL introduced Liquid Hand-Wash

9. Line Modernization-
 Even when the product is adequate, the line might need to be modernized
 In modern business line modernization is carried out to gain competitive
advantage as the competitors are also upgrading their products
 TATA Sumo (1994) >> Sumo DX (1996) >> Sumo DI Spectra (2000)……………..
So on
Line Pruning-
 Company may find out that one end of its line selling well & other end is not &
hence they may try to boost the demand for slower sales
Line Extension-
 Adding a new product line in the product mix is called Line Extension

10.  In economics and marketing, product
differentiation is the process of distinguishing a
product or offering from others, to make it more
attractive to a particular target market
 This involves differentiating it from competitors'
products as well as a firm's own product offerings
 Product differentiation can be achieved on the
basis of price, style, packaging, size, flavor etc.

11.  The stages through which a new product idea goes through from beginning to
end
 It is a generic description of the way a product behaves in the market place
 Every product passes through certain identifiable stages
 Basically, it is a model that describes the stages a product goes through

13.  This is stage where the product is first introduced to the market
 This stage is most risky and expensive as the brand awareness & the
volume of sales is very low (almost zero)
 This is also known as the stage of negative return

14.  The product has developed gained certain degree of brand awareness
 The sales volume starts to grow quickly & the profits peak
 However during the later phase of the stage sales volume starts to dip as new
competitors enter the market

15.  The most profitable Stage as the product has achieved acceptance by most
potential customers
 Sales continue to increase but at a slower pace
 Advertisement expenditures will be reduced as the brand awareness is strong
 Company not only looks to extend its market share but also it looks to defend
its existing one

16.  Sales begins to decline as the demand for the product decreases
 The product becomes technologically obsolete
 During the decline phase the firm generally have following options
1. Maintain the product & hope that the competitors will exit the market
2. Decrease the price of the product or use other pricing techniques to
increase the sales
3. Reposition the product
4. Discontinue the product

18. MARKETING OBJETIVES
 To create the product awareness and to attract the customers towards the product
Product
 They offer only on product in the market. They did not come up with the differentiated product
Price
 In the initial stages of the product, they offer the relatively higher price than their competitor
(LIFEBUOY). Because, they want to recover their initial cost of making the product
Promotion
 In the initial stages, they allocated more advertising budget So that more and more customers could
be attracted towards the product
 In ads they targeted the early adopters, who were readiest to buy the product
 The first ambassador, Leela Chitnis.
Place
 Distribution was selective and only covers the major cities of India to get recognition in those cities.

19. Marketing Objectives
 The marketing objectives of the Lux were to expand their market to the other cities of India
MARKETING STRATEGIES
Product
 In the growth stage, the company had offered the same product in the market.
Price
 In this stage, the company had changed their price to some extent because of maximizing the
market share. ( Slightly cut down the prices )
Place
 In this stage, company had expanded their market to the other cities of INDIA. Their distribution
channel was the same as in the initial stages of the product.
Promotion
 In the growth stage, they had increased their advertising budget as in the initial stages because of
attracting the new customers or to retain the existing customers.
 Sharmila Tagore, Hema Malini, Zeenat Amaan, Juhi Chawla, Madhuri Dixit, Sridevi

20. MARKETING OBJECTIVES
 The marketing objective of Lux is to maximize more profit while defending the market share. And to expand
the market to all the cities of INDIA.
MARKETING STRATEGIES
Product
 The Lux has made the modification in the product by introducing
 Lux Almond, Lux Orchid , Lux Fruit, Lux Saffron, Lux Chocolate, Lux Oil and Honey.etc
Price
 The Lux products are now available at higher prices in the market, the reason behind is that the company’s
marketing objectives is to maximize more profit
Place
 Now Lux products are available in almost all the cities of India
Promotion
 In this stage Lux advertising has been reduced to some extent because of the more brand awareness in the
minds of customers.
 Recently, they have shown Aishwarya Rai , kareena kapoor & ShahRukh khan

22.  A product that opens up entirely a new
market
 A product that replaces an existing
product
 An old product introduced in a new
market
 An old product packaged in a different
way
 An old product marketed in a different
way
 A new product launched in a new market
 A new product launched in an old market

23.  Throx
Socks with a spare - Throx is a company that
sells socks, claiming to have solved the
problem of the missing sock: by selling three
socks instead of two
 The Fizz
The screw on ice-cream top - The Fizz is a
plastic cup that screws on to a plastic PET
bottle allowing you to create a mobile ice
cream float

24.  Neglect of market research
 Inaccurate market research
 Poor marketing after launch
 Poor distribution
 Performance below expectation
 Product too complex
 Market not ready for the product

25.  To add to product mix
 To replace declining products
 To take advantage of new technology
 To maintain/increase market share
 To defeat or to keep up with rivals
 To maintain competitive advantage
 To bring in new customers

26. Idea Generation
Idea Screening
Concept Testing
Business Analysis
Product Development
Test Marketing
Commercialization
AmountofInvestment

27.  New Products by their very nature are the results of innovations
 These innovations result from creative & free thinking
 The sources of Idea generation are:
 R & D Department
 Production Department
 Sales Team
 Employees
 Customers
 Competitors
 Market Sources

28.  The main objective of idea screening is to spot good ideas and reject
poor ones
 Ideas are checked for technical feasibility, financial viability &
marketability
 Ideas are rated according to marketing, production & strategic factors

29.  During this stage the consumers are presented with a proposed product to
measure their attitude & intentions
 Sample of potential buyers are presented with the product idea through a
written or oral description to determine the attitudes & initial buying
intentions

30.  In this stage potential profitability of the new product are evaluated
 During this phase potential sales, profit, BEP , ROI, etc. are reviewed
 During this phase the company analyzes the feedback of the sample of the
potential buyers.
 Analysts look to study the technical & the financial feasibility of the product
 Several statistical analysis such regressing, hypothesis testing etc. are used
during this phase

31.  R&D turns the idea into a product
 Engg. & production issues are involved
 Concern with design, materials, production, processes, quality & safety
 Developing the product concept into a physical product

32.  Launching a product in small geographical area
 A field experiment in realistic market setting
 Releasing the product into a small but representative market where
consumer reactions can be assessed & the marketing mix checked and
adjusted
Objectives
 Forecast likely results of a national launch
 Test the operational effectiveness of the marketing plan
 To identify possible problems & customer reaction

33.  Introducing a new product in the market
 Heavy promotional expenditure at the launch as the product is in the
introduction stage
 Product has to be well targeted and positioned
 Choice of skimming or penetration pricing