The NPD process involves 8 key stages from idea generation through to product launch. It begins with brainstorming ideas and evaluating their potential. Top ideas are further developed into concepts which are tested through market research. Strategic and financial analysis determines if concepts fit the business. Products are developed, tested with customers and modified based on feedback. They are then commercialized by determining pricing and marketing plans. Finally, a launch plan introduces the product to the market.

13. • The NPD process involves eight key stages:
• 1. Idea generation - brainstorming and coming up with innovative new ideas. See generating
ideas for new products and services.
• 2. Idea evaluation - filtering out any ideas not worth taking forward. See screening new
product or service idea.
• 3. Concept definition - considering specifications such as technical feasibility, product design
and market potential. See researching new product and service ideas.
• 4. Strategic analysis - ensuring your ideas fit into your business' strategic plans and
determining the demand, the costs and the profit margin.
• 5. Product development and testing - creating a prototype product or pilot service.
See concept development and testing.
• 6. Market testing - modifying the product or service according to customer, manufacturer and
support organisations' feedback. This involves deciding the best timing and process for
See how to test the market.
• 7. Commercialisation - determining the pricing for your product or service and finalising
marketing plans. See pricing strategy for a new product or service.
• 8. Product launch - a detailed launch plan can help ensure a smooth introduction to market.

14. 1. New product development (NPD) is a process of taking a
product or service from conception to market.
The process sets out a series of stages that new products
typically go through, beginning with ideation and concept
generation, and ending with the product's introduction to the
market.
Occasionally, some of the stages overlap or vary depending
on the nature of the business

15. 1. Idea generation - brainstorming and coming up with innovative new ideas.
• Generating ideas for new products and services.
• A new idea is often the basis for starting up a business. Many entrepreneurs spot a gap in the
market and start businesses that provide a product or service that fills it. Others come up with
ways to improve an existing product.
• Idea generation
• The development of a new product or service usually starts with an initial idea. There are many
ways to come up with an idea. To begin with, you can ask yourself the following questions:
• Is there a gap in the market in the industry that you currently work in?
• Are there gaps in your existing product range?
• Are there weaknesses in existing products that you may be able to address?
• Can you adapt, modify or improve your existing products?
• Can you use customer's feedback to enhance your existing products or services?
• Can you identify a need for a particular service or product that nobody else provides?
Ideation, or generating a good product or service idea, is your starting point in any new product or
service development

16. 2. Idea evaluation - filtering out any ideas not worth taking forward
• Screening new product or service ideas
• Successful new product development starts with identifying good product or service ideas.
You will have to carefully evaluate each idea to determine which are worth pursuing and
which you should discard.
• When screening or selecting your ideas, it might help to assess them against an objective
set of criteria. For example, the criteria may include:
• the needs of your market and your customers
• details of your customer behaviours and expectations
• the affordability of your idea, including resources needed for research and development
• the technical feasibility of your idea
• the market potential of your idea
• the profitability of your idea and the return on investment
• relevancy and desirability of your new products or product improvements
• your competition and their existing products
You may also want to consider doing a SWOT analysis for each of
your ideas to identify their strengths and weaknesses

17. • SWOT analysis example
• A SWOT (strengths, weaknesses, opportunities, threats) analysis can help you
understand how your business is positioned in relation to the market and your
competitors.
• You can use SWOT analysis for any of the following:
• brainstorming
• business planning
• strategic planning
• competitor evaluation
• marketing
• product development
• business reports

18. 3.Concept definition - considering specifications such as technical
feasibility, product design and market potential
• Researching new product and service ideas
• The key to successful research and development (R&D) is conducting
extensive market research. This is essential as it helps you to identify and
understand the needs of your customers and, ultimately, develop better
products or services.
How to identify market need?
• To determine if there is a market or demand for your product or service,
ask yourself the following questions:
• Does it satisfy or create a market need?
• Will it outlive passing trends or capitalise on the trend before it dies away?
• Is it unique, distinct or superior to those offered by competitors?
• What competition will it face - direct or indirect, local, national or global?
• Will the market want your product or service at a realistic price?
• Can you identify potential customers?
• Will your product be safe for public use and comply with relevant laws and

19. Market research and market reports
Introduction
• A business that understands its customers and their buying habits can:
• sell more effectively
• compete with other suppliers
• target new customers
• identify new opportunities
• There is a wide range of data available, which can help you build up a
picture of general trends and your customers' buying habits. This
includes both published data, and information you can collect yourself.
• This guide explains primary and secondary market research. It helps you
to plan your field research and avoid pitfalls. This guide includes tips for
effective market research.
• This video explains how to use market research to gain knowledge about
your marketplace, your customers and their behaviour to target them
better: https://www.nibusinessinfo.co.uk/content/market-research-
and-market-reports

20. • 4. Strategic analysis - ensuring your ideas fit into your business' strategic plans and determining the
demand, the costs and the profit margin.
• 5. Product development and testing - creating a prototype product or pilot service. See concept
development and testing.
• Concept development and testing
• Guide
• Concept development and testing is a crucial stage in the new product or service development. It takes
helps to identify key perceptions, user needs and wants associated with the product or service.
• What is concept development?
• Concept development involves coming up with a detailed description of an idea, explained from the
concept typically highlights the best features of the proposed solutions in terms of:
• convenience
• usability
• quality
• functionality
• performance
• price
• values
• experience
• When developing a new product or service, it is common to work with a large number of concepts and
show the most promise.

21. • What is concept testing?
• Concept testing is a process that helps you assess the customer reaction to your proposed
product or service prior to introducing it to the market. It typically involves surveying potential
users for their opinions on the concept. For example, you may want to ask them:
• Are they interested in the product?
• How much do they like the product?
• How desirable do they find the product's features?
• What features do they like most/least?
• How well would the product compare to other brands or a similar product?
• What price point would they find appealing?
• What would they like to change about the product?
• You may want to present several different concepts to determine which ones the customers find
most desirable.
• Benefits of concept development and testing
• Developing a product concept may take time, but it is extremely important for the success of
your project to define your concept clearly, test it rigorously and avoid making assumptions
about the product's feasibility.

22. • What is a new product concept?
• A new product concept is basically a blueprint for your idea. When
developing a new product concept, you should:
• describe it from your customers' point of view
• list features and benefits of your product that may appeal to
customers
• research and determine your target audience
• conduct focus groups and thorough market research
• consider resources required for designing, manufacturing and
delivering the product
• Once you develop your product concept, you should test it
rigorously with your intended customers to determine its viability.

23. • 6. Market testing - modifying the product or service according to customer, manufacturer and
support organisations' feedback. This involves deciding the best timing and process for piloting
how to test the market.
• Test the market
• Guide
• Prototyping and product testing are important throughout the design and development process.
While you are developing your new product or service, it's a good idea to keep testing the market
right track.
• New product prototypes
• Developing a prototype of your product allows you to bring it to life and test it in the market with
• A product prototype can be as simple as a mock-up or an early commissioned sample. A
• how to package, brand and market your product
• how your product's 'look and feel' appeal to your customers
• if the product meets the market expectations
• How to test your prototype
• You should test your prototype in the type of situations you expect it to be used by your
should:
• show an early version of your product to customers and refine it based on the feedback
• run focus groups - ask your targeted customer segment what they want from your product or
• conduct questionnaires - try to get as wide a sample as possible

24. In-market testing
•You may want to consider testing even after your
product goes on sale. Ongoing contact with customers
can uncover both the shortcomings of your product
and possible opportunities that you may have missed.
•Once you have a final product, you can then set about
building a brand. A brand includes everything that is
visible to the customer, such as the product name, its
packaging and its delivery.

25. •Concept testing will help you evaluate objectively which
product ideas are likely to yield the best results. It may also help
you to:
•estimate the concept market potential
•prove the viability of the concept
•eliminate poor concepts
•identify features that customers find most desirable
•develop and further test your prototypes
•segment your potential customer base
•identify the appropriate price point and position for your product
•estimate sales and potential return on investment

26. • 7. Commercialisation - determining the pricing for your product or service and
finalising marketing plans. See pricing strategy for a new product or service.
• Pricing strategy for a new product or service
• Establishing a pricing strategy for a new product or service is an important part of the
should consider pricing the moment you decide to take an idea forward as it will
to invest in the project.
• How to price your new product or service
• To set the right price for your product or service, you will need to take the following
• the impact of your new product or service on your entire portfolio
• the analysis of its value - eg the benefits to the customer and the likelihood of them
charge
• the competition and their pricing - is your product or service innovative or are you
• the selling channels you want to use - this will affect your promotional spend and
• how quickly you want to establish your product or service
• the expected life cycle of your product or service
• how much you will need to charge to cover your costs
• Make sure to cost all the materials, other inputs, machinery, processes and
need to research different suppliers and the cost of marketing and distribution.

27. • Commercialisation is marketing or selling a product or service. If you
have developed and tested a product or service you will want to
commercialise it.
• As with previous steps you should bring together a multi-disciplinary
team with design, manufacturing, finance, sales, and marketing
expertise. All will be vital to fully executing the concept.
8. Product launch - a detailed launch plan can help ensure a smooth
introduction to market