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NPD

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Jai Jaisinghani
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7 views

NPD

Uploaded by

Jai Jaisinghani
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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New Product Development

Causes of New Product Failures

• Overestimation of Market Size


• Product Design Problems
• Product Incorrectly Positioned, Priced or
Advertised
• Costs of Product Development
• Competitive Actions

• To create successful new products, the


company must:
– understand it’s customers, markets and
competitors
– develop products that deliver superior value to
customers.
New Product Development
Process

• Idea Generation and


• Idea Screening
• Concept Development
and Testing
• Marketing Strategy
• Business Analysis
• Product Development
• Test Marketing
• Commercialization
New Product Development Process
Step 1. Idea Generation

Systematic Search for New Product


Ideas
Internal sources
Customers
Competitors
Distributors
Suppliers
New Product Development Process
Step 2. Idea Screening

• Process to spot good ideas and drop


poor ones
• Criteria
– Market Size
– Product Price
– Development Time & Costs
– Manufacturing Costs
– Rate of Return
New Product Development Process
Step 3. Concept Development & Testing

1. Develop Product Ideas into


Alternative
Product Concepts

2. Concept Testing - Test the


Product Concepts with Groups
of Target Customers

3. Choose the Best One


9-7
New Product Development Process
Step 4. Marketing Strategy Development

Marketing Strategy Statement Formulation

Part One - Overall:


Target Market
Planned Product Positioning
Sales & Profit Goals
Market Share

Part Two - Short-Term:


Product’s Planned Price
Distribution
Marketing Budget

Part Three - Long-Term:


Sales & Profit Goals
Marketing Mix Strategy
New Product Development Process
Step 5. Business Analysis

Business Analysis

Review of Product Sales, Costs,


and Profits Projections to See if
They Meet Company Objectives

If No, Eliminate
Product Concept

If Yes, Move to
Product Development
9-10

Step 6. Product Development

• Target Market Requirements -----working Prototypes


using methods (QFD)

• Customer Attributes
• Engineering Attributes
• Physical Prototype
• Customer Tests
New Product Development Process
Step 7. Test Marketing

Standard Controlled
Test Market Test Market
Full marketing campaign A few stores that have
in a small number of agreed to carry new
representative cities. products for a fee.

Simulated
Sales Wave Test Market
Research Test in a simulated
Consumers who buy shopping environment
pdt , are offered pdt to a sample of
consumers.
again
Commercialization
• Launching at full fledged commercial level.
• When (First Entry, Parallel Entry ,Late Entry )
• Where
• To Whom
• How

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