This document outlines the process for developing new products and services. It discusses analyzing markets and customer needs to identify opportunities. Key steps include identifying target market segments, analyzing competition, and generating ideas. Ideas should be reviewed for relevance and practicality before products or services are created based on market analysis and within budget constraints. Sales performance is then monitored to support continuous improvement. The overall goal is to develop offerings that provide value and meet evolving customer expectations.

1. DEVELOP NEW PRODUCTS
AND SERVICES
D1.HCS.CL6.07
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2. Subject elements
This unit comprises four elements:
• Analyse markets
• Evaluate market trends in food production and/or food
and beverage service
• Create products or services based on market analysis
and within budgetary constraints
• Monitor sales performance of products
and services
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3. Assessment
Assessment for this unit may include:
• Oral questions
• Written questions
• Work projects
• Workplace observation of practical skills
• Practical exercises
• Formal report from supervisor
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4. Element 1:
Analyse markets
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5. Analyse markets
Performance criteria for this element are:
• Target markets are identified in accordance with
enterprise marketing and merchandising policies
• Analyse market competition
• Client requirements are monitored informally in order to
evaluate market trends and client needs
• New products and services are identified
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6. Analyse markets
Performance criteria for this element are:
• Opportunities to improve sales and services are
identified
• Product and service range is monitored to identify the
demand for individual items and seasonal variations
• Product and service range is planned
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7. Need for new products and services
Need for new products and services
It is normal practice for businesses, regardless of industry,
to develop and introduce new products and services.
This may include:
• Improvements to existing offerings
• Complete changes of direction
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8. Need for new products and services
Need for new products and services
New products and services will only be successful if:
• It is unique when compared with competitor’s offerings
• It provides value for money
• The customer views the product or
service as valuable in their eyes
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9. Need for new products and services
Examples of new products and services
What have been successful new products and services
that have entered:
• Generally
• The hospitality industry specifically?
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10. Change
A rolling stone gathers no moss!
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11. Change
• What is change?
• Why is it important?
• What influences change
Change is inevitable
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12. Continuous improvement
• What is it?
• Why is it important?
• Who is responsible for implementing it?
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13. Continuous improvement
• Regardless of their visit it is important that the customer
receives a ‘quality offering’
• A quality offering is being able to use a combination of
products and services
• This combined offering, at a minimum, must meet the
customer’s:
 Needs
 Expectations
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14. Continuous improvement
Need for continuous improvement
Continuous improvement and change focuses on improving:
• Products
• Services
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15. Continuous improvement
Products and Services
• Which is more important – product or service?
• What do these include?
• Which aspects can be improved?
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16. The customer
• The customer is............
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17. Market segments
Identify market segments
Any hospitality organisation, like in any business in any industry,
cannot be everything to everyone.
It must:
• Break down the potential audience into
segments with similar characteristics
• Choose those segments they
believe will be the focus of their efforts
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18. Market segments
Generic market segments
• Age
• Social background
• Economic background
• Cultural background
• Special interests
• Physical and mental abilities
• Dietary needs
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19. Market segments
Hospitality market segments
• Business
• Leisure
• Religious
• Sporting
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20. Market segments
Tourism market segments
• Outbound Tourists
• Inbound Tourists
• Domestic Tourists
• International Tourists
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21. Target market segments
Identify target market segments
What are the key target segments for:
• Resorts
• City hotels
• Budget accommodation
• Stand alone restaurants
• Fine dining restaurant in a hotel
• Corner bar
• Coffee shop?
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22. Target market segments
Benefits of establishing target market segments
The analysis and collection of information in relation to different
target market segments will guide:
• Products and services offered
• Prices charged
• Where advertisements are placed
• How advertisements are targeted
• Staff required
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23. Analyse market competition
Importance of analysing the market?
• What do you want to analyse?
• What information do you seek?
• Where do you get this information?
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24. Analyse market competition
What is market analysis?
• Market analysis provides us with the information necessary to
understand what can cause changes in our operational
environment
• A prime intent of this activity is to gain a more
insightful and detailed view of the organisation
and where it sits in the overall business and
other settings
• Helps identify ‘current market situation’
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25. Current market situation
Market situation
• Total market characteristics – size, growth, trends
• Customer needs, perceptions and buying behaviour
• Products – service characteristics
• Prices
• Customer service and distribution
• Channels
• Communication
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26. Current market situation
Competitive situation
• Industry structure
• The geographic market in which they compete
• Their current marketing performance
• Their competitive position
• Strengths and weaknesses, and vulnerabilities of each
significant competitor
• Their objectives and competitive strategies
• Industry profitability
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27. Current market situation
Product situation
• For each product/service that the organisation offers, sales,
profits, contribution margins and growth should be
displayed
• Product lifecycle and expected demand over the product’s
life should be considered
• Growth of the product/service should be
contrasted with total market growth
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28. Situation Analysis
Analyse the environments
It is vital to understand what can cause changes in our
operational environment.
It is important that managers analyse what is happening both:
• Outside the business (external environment)
• Inside the business (internal environment)
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29. Analyse the environments
SWOT analysis
• Strengths – what the business does well
• Weaknesses – what the business can improve upon
• Opportunities – where the business can improve or take
advantage
• Threats – where the business may become
disadvantaged, weakened or susceptible
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30. Analyse the environments
Analysis of external environment
• Competitors
• Economic climate
• Customer preferences
• E-business
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31. Analyse the environments
Analysis of external environment
• Environment
• Technology
• Political issues
• Legal issues
What other external influences exist?
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32. Analyse the environments
Analysis of internal environment
• Environment
• Organisational structure
• Products
• Services
• Equipment
• Marketing
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33. Customer focus
• Before we can tailor our products and services to provide an
offering that the customer wants, we first need to find out
what they actually want
• Many businesses make the mistake of providing an offering
they THINK the guest wants, but what is offered doesn’t meet
their needs
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34. Customer focus
• Who are your customers?
• What are the needs of your customers?
• How do you identify their needs?
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35. Customer needs
Generic needs
• Value for money
• ‘Offering’ reflecting what was advertised
• Expectations met/exceeded
• To feel respected
• To feel welcomed
• To be served by friendly staff
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36. Customer needs
Generic needs
• To be dealt with in a prompt and courteous manner
• To receive assistance when necessary
• To be in comfortable, clean surroundings
• To feel remembered and recognised
• To be heard and understood
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37. Customer needs
Specific needs
What are the specific needs of your markets?
• Business
• Women
• Family
• Leisure
• Elderly
• Others
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38. Expectations
Expectations come from:
• The company’s image or reputation in the market
• Past visits
• Advertisements and promotional messages
• Competing hotels
• Industry standards
• Comments from family, friends and colleagues
• Price charged for the offering
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39. Identify new products and services
As mentioned, an ongoing process for a hotel to stay ‘fresh,
unique and in demand’ is to identify new products and services
to attract and maintain customers.
In hospitality the product/service offering is combined to meet
customer needs and consists of the following elements:
• A tangible product or products
• Environment
• Services
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40. Identify new products and services
Products
• What is classified as a product?
• What are examples of products in the hospitality
environment?
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41. Identify new products and services
Services
• What is classified as a service?
• Who provides the service?
• What are examples of services in the
hospitality environment?
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42. Identify new products and services
Characteristics of services
Pure services are activities or benefits characterised by:
• Intangibility
• Inseparability
• Perishability
• Variability
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43. Opportunities to improve sales and
services
Need to identify improvement opportunities
The need to identify opportunities for improvement is especially
important when new products and services are introduced as
new opportunities may become apparent as they are
implemented into the marketplace:
• How can you do this?
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44. Opportunities to improve sales and
services
Ways to identify improvement opportunities
• Observing what occurs in the workplace
• Develop and use a checklist to guide what you observe
• Involve workers in your observations
• Analysing documentation
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45. Opportunities to improve sales and
services
Ways to identify improvement opportunities
• Being advised by management/owners
• Monitoring the external business environment
• Making ‘improvement/continuous improvement (CI)’ a
standing topic in every staff meeting
• Involving staff
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46. Generate ideas
Generating ideas
• How would you generate ideas?
• Why is it important to involve staff in the process?
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47. Generate ideas
Common techniques to generate ideas include:
• Talking to colleagues and supervisors
• Looking at what happens in other venues
• Contacting industry peak bodies
• Reading industry literature
• Conduct internet research
• Using creative thinking techniques
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48. Generate ideas
Creative thinking techniques
• Brainstorming
• Visualising
• Making associations
• Lateral thinking
• Six thinking hats
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49. Generate ideas
Use relevant knowledge
In addition to creative thinking ideas, there is always the need
to apply relevant knowledge to a situation where workplace
improvements are being considered:
• Technical knowledge
• Service-based knowledge
• Information from different work areas
• Information from colleagues
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50. Review ideas
Review ideas for relevance and practicality
When you have captured ideas and information relating to them
your next step is to review and evaluate these ideas.
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51. DEDY WIJAYANTO 51
deddywijayanto@stptrisakti.ac.id
See in part 2