New Product Development Flashcards
Product
The specific combination of goods, services, and ideas that a firm offers to its target market
Innovation
The creation of a new or significantly improved product offering
Five specific drivers of innovation are..
Consumer expectations, competition, globalization, technology, and changing society
New-to-the-market Products
Products that have never been seen before and create a new market
New Category Entries
Products that are new to a company but are not new to the marketplace
Product Line
A group of related products marketed by the same firm
Product Line Extensions
Products that extend and supplement a company’s established product line
Revamped Product
A product that has new packaging, different features, and updated designs and functions
Diffusion
How new products are likely to be adopted, the rate at which they will be adopted, and the process through which their products will spread into markets
Adoption
When a consumer purchases and uses a product
Five stages of the consumer adoption are…
Awareness, Interest, Evaluation, Trial, and Adoption
Innovators
Consumers that adopt a product almost immediately after the product is launched
Early Adopters
Consumers that purchase and use a product soon after it has been introduced
Early Majority
Consumers that are careful in their purchase research, gathering more information and and spending more time thinking about the purchasing decision than the earlier adopters
Late Majority
Consumers that tend to be cautious about new things and ideas
Laggards
Consumers that tend to not like change; they may remain loyal to a product until it is no longer available for sale
New product characteristics are…
Competitive Advantage, Compatibility, Observability Complexity, Trialability
New Product Development (NPD) process
The process of conceiving, testing, and launching a new product in the marketplace
Seven stages of NPD Processes are…
New Product Strategy Development, Idea Generation, Idea Screening, Business Analysis, Product Development, Test Marketing, Product Launch
Planned Obsolescence
A marketing criticism in which companies frequently come out with new models of a product that make existing models obsolete. It can also involve limiting the product lifespan rather than the product availability.
Product Life Cycle (PLC)
A series of stages that happen during a product’s life
Introduction Stage
The stage of the product life cycle when a product is new and sales are low, while expenses are high
Growth Stage
The stage of the product life cycle characterized by increases in sales, profits, and competition
Maturity Stage
The stage of the PLC during which late majority and repeat buyers make up an increasing percentage of the customer base. The main objectives of the maturity stage are earning profits and maintaining the firm’s market share for as long as possible.
Decline Stage
The stage of the PLC that is preceded by declining sales and profits. Depending on the product, the decline in sales may occur over a long period of time. During the decline stage, competitors drop out of the market as the product becomes unprofitable
