New Product Marketing

Question 1

What are the categories of new products?

Answer 1

1. New-to-the world
2. New product line
3. Addition to existing product line
4. Improvements
5. Repositioned
6. Lower-priced

Question 2

What are the steps of the New Product Development Process? Briefly describe each one.

Answer 2

1. Strategy: plan linking NPDP with objectives of the marketing team.
2. Idea Generation: brainstorming.
3. Idea Screening: first filter.
4. Business Analysis: second filter. Preliminary figures for costs, sales and demand.
5. Development: prototype. Preliminary everything with marketing plan.
6. Test Marketing: limited introduction to market.
7. Commercialization.

Question 3

What are some causes of failure of new products?

Answer 3

• No discernible benefits
• Poor match between product features and customer desires.
• Overestimation of market size.
• Price to high or too low.
• Inadequate distribution.

Question 4

Diffusion of Innovation: what are the different adopters? Describe each one.

Answer 4

1. Innovators: obsession. High income
2. Early adopters: earn respect. Community orientated.
3. Early majority: rely on group information.
4. Late majority: guided by friends.
5. Laggards: innovation has been outmoded

Question 5

What are the stages of the Product Life Cycle? Describe each one.

Answer 5

1. Introductory: full launch of new product. High costs due to heavy promotion. Little competition. High risk of failure.
2. Growth: Sales increase at increasing rate. Competitors start to appear. Profits increase. Distribution= key.
3. Maturity: Sales increase at decreasing rate. Saturated markets. Heavy promotion to remind.
4. Decline: Long-run drop in sales.