Unit Iv

NEW PRODUCT
DEVELOPMENT
PROCESS.
1
CONTENT
• New Product.
• New Product Development &

Process.
• Conclusion.
2
New
product.
• A product is anything that can be offered
to a market to satisfy needs and wants.
• A New product is any product which is
perceived by the customer as being new.
New product Categories…….

1:New to the world.
2:New to the product lines.
3:Additions to the existing product line.
4:Improvements & revisions of existing
products.
5:Repositioning.
6:Cost reductions.
3
New Product
development Process
• New Product Development is the
development of original products, product
improvements, product modifications, and
new brands through the firm’s own R & D
efforts. This process consist of following
steps.
1. Idea Generation.
2. Idea Screening.
3. Concept Development & Testing.
4. Marketing Strategy Development.
5. Business Analysis.
6. Product Development.
7. Market Testing.
8. Commercialization.
4
1.Idea
Generation .
• Idea generation is continuous,
systematic search for new product
opportunities.
• Ideas form using creativity generating
techniques and generated through
firm’s Internal Sources & external
Sources.
5
2.Idea
Screening.
• Filtering the ideas to pick out good ones &
dropping the poor ones.
• It involves a preliminary elimination process in

which a large number of product ideas are
screened in terms of the organization’s
objectives, policies, technical feasibility, and
financial viability.
• Total ideas are categories into three group.
They are, promising ideas, marginal ideas and
rejected ideas.
• In screening ideas, the companies normally

face 2 serious errors & they must try to avoid
these mistakes.
1. DROP ERROR 2. GO ERROR
6
3. Concept
Development &
• Here, the Testing.
Product Idea is converted into
product concept.
 Product Ideas means Possible product that company

may offer to the market.
 A product concept is a detailed version of the idea
stated in meaningful consumer terms
• When developing product concept following criteria

should be consider.
Who will use the product.
What primary benefit should this product provide.
When will this product be consumed.
• Concept Testing means presenting the

product concept to target consumers,
physically or symbolically, and getting their
reactions.
7
4.Marketing
Strategy
Development.
After concept testing, for concepts that qualify a
preliminary marketing strategy is created to
introduce new product into market.
8
5.Business Analysis.
 This stage will decide whether from financial as
well as marketing point of view, the project is
beneficial or not.
In Business Analysis ,
• Estimate likely selling price based upon
competition and customer feedback.
• Estimate sales volume based upon size of
market.
• Estimate profitability and break-even point.
 If above are match with the company's

objectives, then the new product concept
moves to product development stage.
9
6.Product
Development.
• Up to now, the product has existed only as a
word description, a drawing.
• The company will now determine whether

the product idea can translate into a
technically and commercially feasible
product.
Produce
a
Test the Conduct focus Make
physical product group adjustment
customer
prototype
10
7. Market
Testing.
• Now the product is ready to be branded with

a name, logo, and packaging and go into a
preliminary market testing.
• Marketing Testing involves placing a product

for sale in one or more selected areas and
observing its actual performance under the
proposed marketing plan.
• Methods for market testing:

1. Sales wave research.
2. Simulated test marketing.
3. Controlled testing marketing.
4. Test markets.
11
8.Commercialization.
• After successful market testing, new product
comes to commercialisation stage.
• During this stage, production of new product
on a commercial basis is rapidly built up and
implementing a total marketing plan.
• For formally launching a New Product, the

following decisions to be taken:
A) When to launch (Timing)
B) Where to launch (Geographic Strategy)
C) To Whom (Target-Market Prospects)
D) How to launch (Introductory Market Strategy)
12
CONCLUSION.
• Every year millions of rupees are being spent
on R&D for new products development. Such
huge investment is necessary as new products
are the only means of survival of a firm.
• Product development process include ; Idea
Generation, Idea Screening, Concept
Development & Testing, Marketing Strategy
Development, Business Analysis, Product
Development, Market Testing,
Commercialization.
• New product development provides a number
of advantages to the enterprise.
 To produce goods & services with best quality.
 It helps in providing maximum customer
satisfaction.
 To replace declining product and take
advantage of new technology.
 To maintain/increase market share with
competitive advantages.
 To fill gap in the market.
13

Unit Iv

Uploaded by

Copyright:

Available Formats

Unit Iv

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Unit Iv

Uploaded by

Copyright:

Available Formats

NEW PRODUCT

• New Product Development &

New product Categories…….

• It involves a preliminary elimination process in

• In screening ideas, the companies normally

 Product Ideas means Possible product that company

• When developing product concept following criteria

• Concept Testing means presenting the

 If above are match with the company's

• The company will now determine whether

• Now the product is ready to be branded with

• Marketing Testing involves placing a product

• Methods for market testing:

• For formally launching a New Product, the

You might also like