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Generating, Screening AND Developing Ideas: Essentials of Marketing

This document discusses product development and management. It covers the product life cycle and how marketing strategy should adapt to each stage. The five steps of new product development are outlined as idea generation, screening, evaluation, development, and commercialization. Quality management is also discussed, including the need for product managers and a total company effort in new product development. The key is understanding customer needs and having a structured development process with top management support.

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Sonia Khan
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94 views37 pages

Generating, Screening AND Developing Ideas: Essentials of Marketing

This document discusses product development and management. It covers the product life cycle and how marketing strategy should adapt to each stage. The five steps of new product development are outlined as idea generation, screening, evaluation, development, and commercialization. Quality management is also discussed, including the need for product managers and a total company effort in new product development. The key is understanding customer needs and having a structured development process with top management support.

Uploaded by

Sonia Khan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Essentials of Marketing

GENERATING,
SCREENING
AND
DEVELOPING
IDEAS

SHAHBANO
KHAN

At the end of this presentation, you should


be able to:
1.

Understand how product life cycles affect strategy


planning.

2.

Know what is involved in designing new products and


what new products really are.

3.

Understand the new-product development process.

4.

See why product liability must be considered in


screening new products.

5.

Understand the need for product or brand managers.

6.

Understand how total quality management can


improve goods and services.

7.

Understand important new terms.


92

Product Decisions for Marketing Strategy


Planning (Exhibit 9-1)

93

The Role of Product Management and New-Product


Development in Marketing Strategy

Elements of Product
Planning for Goods
& Services

The Product Life


Cycle
Development
Stages
Strategy planning
for stages

Management & NewProduct


Development

New Product
Development
5 Step Process
Success factors

Managing brands
Product
managers
Managing product
quality
94

Typical Life Cycle of a New Product


Concept

Total industry
sales

Total industry
profit (initially loss)
95

Market
Introduction
Investing in
the Future

96

Market Growth StageProfits Go Up and


Down
Innovation Attracts
Competition

Monopolistic Competition
Develops

Profits Peak and Then


Decline

Dont Ignore Long-Term Competitive Trends!


97

Market Maturity StageSales Level Off,


Profits Continue Down
Persuasive, More Costly
Promotion

Brands Are More Similar

Greater Price
Competition/Price Sensitivity

Maturity May Last a Long


Time
98

Sales
Decline A
Time of
Replacement

99

Which Stage of PLC?

910

Checking Your Knowledge


Kodak announced that it would no longer produce 35
millimeter film cameras, but would manufacture digital
cameras exclusively. Sales of digital cameras have grown
steadily and have far outpaced the sale of 35 mm cameras in
recent years, even among professional photographers. Kodaks
decision indicates that 35 mm cameras are probably in the
________ stage of the product life cycle.
A. Market introduction
B. Market growth
C. Sales decline
D. Market maturity

911

Product Life Cycles Should Be Related to


Specific Markets
Individual
Brands

Market
Definitions

May not follow the


classic pattern

Should be carefully
developed

May be introduced
in market growth or
maturity

Different markets,
different stages

Not all brands are


equally strong

AND

Contribute to the
length of the cycle

912

Product Life Cycles Vary in Length


Comparative
Advantage

Easy to Use

Some Products
Move Fast
Compatible

Easy to
Communicate

Can Be Tried
913

Interactive Exercise: Adoption

914

Other Issues in Product Life Cycle Length

Product Life Cycles Are


Getting Shorter

The Early Bird Usually Makes


Profits

Fashions and Fads

915

Planning for Different Stages of the Product


Life Cycle
Allocate
Sufficient
Money

Be Flexible

Consider all
Four Ps

Market
Introduction
& Growth

Anticipate
Speed of
Movement

Competitors
May Help
Adoption
916

Managing Mature Products

917

Are Product
Modifications
Really New
Products?

Courtesy of The Procter & Gamble Company.

918

Phasing Out Dying Products

Phase-out May
Be Necessary

Profitability

Product Line
Customer
Support

Dont Pull the


Plug So Quickly
Sales Decline
Can Be Profitable

919

New Product Planning

What Is a New Product?

FTC Rule: 6 Months

Ethical Dilemmas Exist

920

New Product

921

New-Product Development Process


(Exhibit 9-4)
1. Idea
generation
2. Screening

3. Idea
evaluation
4.Development
5. Commercialization
922

Step 1: Idea Generation

1. Idea
1. Idea
generation

generation

Ideas from:
2. Screening
Customers and users
Marketing research
3. Idea
Competitors
evaluation
Other markets
Company people,
4.Development
intermediaries, etc.
5. Commercialization
923

Step 2: Screening
1. Idea
generation

2. Screening
2. Screening

Strengths and
3. Idea
weaknesses
evaluation
Fit with objectives
Market trends
4.Development
Rough ROI estimate
5. Commercialization
924

Step 3: Idea evaluation


1. Idea
generation
2. Screening

3. Idea
3. Idea
Evaluation
evaluation

Concept testing
4.Development
Reactions from
customers
5. Commercial Rough estimates of
ization
costs, sales, and profits
925

Step 4: Development

1. Idea
generation
2. Screening

4. Development
3. Idea
evaluation
R&D

Develop model or
4.Development
service
Test marketing mix
Revise plans as needed
5. Commercialization
ROI estimate
926

Step 5: Commercialization

1. Idea
generation
2. Screening

5. Commercialization
3. Idea Finalize product and
evaluation marketing plan

Start production and


marketing
4.Development
Roll out in select
markets5. Commercial Final ROI estimate
ization
927

Checking Your Knowledge


Top management of a large company recently approached the
dean of a major business school about starting a specialized
MBA program for the companys employees. After further
discussions, the dean decided that the program did not fit
well with the objectives and resources of the school, so the
program was put on the back burner until conditions
changed. The proposed MBA program was at what stage of the
new-product development process when it was shelved?
A. Idea generation
B. Screening
C. Idea evaluation
D. Development
E. Commercialization
928

New Product Development: A Total


Company Effort (Exhibit 9-5)

Organized newproduct
development
process

Complete
marketing plan

Effective
transition to
regular
operations

A basis for
superior
customer
value

New-product
success

Effective
design
929

New Product Development: A Total


Company Effort (Exhibit 9-5)
Top
management
support

Culture of
innovation

Product
champion with
authority

Cross-functional
team

Clear
understanding of
customer needs

Organized new-product development process

Timely
development
cycle

Cost
management
(costs add
value)
930

Checking Your Knowledge


Which of the following statements about new-product
development are true?
A. The process should be informal to encourage innovation.
B. The greatest number of product ideas is in the idea
evaluation stage.
C. The best criteria for evaluating new product ideas in the
early stages is return on investment (ROI).
D. The process should have top management support.
E. All of the above statements are true.

931

Need for Product Managers

Product/Brand Managers

Common in Large
Companies

Some Are Product


Champions

932

Managing
Product
Quality

933

Building Quality into Services


Server Is Linked
To the Service

Training Is Crucial

Empowerment Works

934

Other Issues in Quality Implementation


Efforts
Managers Lead the Effort

Specify Jobs and Measure


Performance

Get a Return on Quality

935

You should now be able to:


1.

Understand how product life cycles affect strategy


planning.

2.

Know what is involved in designing new products and


what new products really are.

3.

Understand the new-product development process.

4.

See why product liability must be considered in


screening new products.

5.

Understand the need for product or brand managers.

6.

Understand how total quality management can


improve goods and services.

7.

Understand important new terms.


936

Key Terms
Product life cycle
Market introduction
Market growth
Market maturity
Sales decline
Fashion
Fad
New product
Federal Trade Commission
(FTC)
Consumer Product Safety
Act

Product liability
Concept testing
Product managers
Brand managers
Total quality management
(TQM)
Continuous improvement
Empowerment

937

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