developing a product

1. Product Development
• Product development is the
process of developing, testing,
and commercializing a product
or service with the ultimate
objective of solving the problem
of the primary target market.
9-1

2. Four Sequential Steps of Product
Development:
9-2
1.Developing a product or
service description.
2.Creating a prototype.
3. Testing the prototype and
4.Validating the market.

3. Reasons for new product failure
•
•
•
•
•
•
•
•
•
Overestimation of market size
Poor design
Incorrect positioning
Wrong timing
Priced too high
Ineffective promotion
Management influence
High development costs
Competition
Product Development Strategy
9-3

4. Product or Service Description
➢Simply describes how a product
or service works and how it
benefits the customers.
➢Serves as the blueprint of all
business operations
9-4

5. Characteristics of product or service
description:
9-5
➢It should directly address the primary
target market in a personal manner using
everyday language.
➢It should highlight the features that will
cater to the customer’s needs or address
the customer’s problems.
➢Realistic superlatives should be used for
the product description.

6. Creating a Prototype
9-6
Prototype – is a preliminary model or sample
of a new product or service that is created to
test a product concept or service process.
•Creating a prototype - is an exciting process
for the entrepreneur because he or she will
be able to see that his or her ideas will soon
become a tangible reality.
- lessens implementation/commercialization
risks

7. Advantages of creating a prototype:
9-7
➢Enables the entrepreneur to engage in trial-and-error,
provides room for improvements, and refines the
functionality of the product design or service process.
➢Provides the entrepreneur a window to test the
performance and specifications of various materials
and service processes.
➢Helps the entrepreneur effectively describe the
product or service to the product team.
➢Elicits respect from key stakeholders and customers
and it gives credibility to the entrepreneur.

8. Testing the product prototype
➢Is a vital process before an
actual product or service is
launched to the market.
9-8

9. TESTING METHODS
9-9
➢Focus Group Discussion
➢Legality and ethical test
➢Safety test
➢Product costing test
➢Component test
➢Competitors’ product/service test

10. 9-10
Validation of Market Acceptability
➢Is the process of finding out if
the intended primary target
market will be buying the
product or availing the service.
➢The last step before the product
or service can be introduced to
the market.

11. Sample questions during
validation:
9-11
➢Will the primary target market like the
product or service?
➢Will the primary target market buy the
product or service when it is already
in the market?

12. Those questions can easily be answered if the
entrepreneur will perform the following
activities:
9-12
1. Use the most strategic marketing research tool
(FGD,etc.) wherein the entrepreneur can get the
most relevant answers in the cheapest way
possible.
2. Prepare relevant open-ended questions that
answers the objectives.
3. Find market experts who also target the same
market but are not directly competing with the
entrepreneur.
4. Collate all the data, analyze them, and prepare a
summative report that answers the objective
questions.

13. • Based on
your observation, do you
think Filipino
entrepreneurs test their
products or services first
before launching them to
the public? Why?
9-13

14. THANK YOU!
9-14