09 - New Product Development & Strategies Flashcards
new product development
development of original products/improvements/modifications, and new brands through the firm’s own product development efforts
acquisition
buying a company/license/patent to produce a product
new product development process (8)
idea generation
idea screening
concept development + testing
marketing strategy development
business analysis
product development
test marketing
commercialization
idea generation
systematic search for new products
- internal sources
- external sources
- crowdsourcing (including broad communities in discussion of new product innovation process)
idea screening
screening new product ideas to spot good ones and drop poor ones
concept development + testing
product concept - detailed version of product idea stated in stated in meaningful consumer terms
concept testing - testing product concepts w/ group of target consumers to find out if the concepts have strong consumer appeal.
marketing strategy development
designing initial marketing strategy for new product based on the product concept
three components of the marketing strategy statement
- description of target market + value proposition + short term goals
- price + distribution + budget
- planned long term goals
business analysis
review of projections for a new product to find out whether these factors satisfy the company’s objectives
product development
developing product concept into a physical product to ensure that the product idea can be turned into a workable market offering
test marketing
product and its proposed marketing program are tested in realistic market settings
types of test marketing
standard - small markets where the firm conducts a full marketing campaign
controlled - tested among controlled panels of shoppers and stores
simulated - create a shopping environment
controlled and simulated reduce the costs and speed process up
commercialization
introducing a new product into the market.
requirements for a successful new product development
customer-centered
team-based (cross-functional team)
systematic effort (innovation management system to collect, review, evaluate + manage product ideas.)
product life cycle stages
product development - sales are zero
introduction - slow sales growth + nonexistent profits
growth - rapid market acceptance and increasing profits
maturity - sales slowdown + profits level off/decline
decline - sales fall off and profits drop
