Professional Documents
Culture Documents
SANA ZAHID
NAVEEN ZUBERI
EXECUTIVE SUMMARY
In the present era of fast changing market dynamics in
marketing, where everyone is trying its level best to
capture either the existing market or creating new markets
through their innovative products.
Due to technological revolution the world has practically
turned into Global village. Multinationals have been able to
develop products according to local needs. Due to credible
market research and customer needs they have been able
to create new markets. Within existing markets due to new
innovative approach they have increased the market base
and also maintained their leadership position.
Local industry has also been able to penetrate better to get
share from multinationals with quality products reinforced
with better strategies and cost effectiveness.
CHALLENGES IN NEW PRODUCTS
DEVELOPMENT
New products failure
2. Poor marketing Plan
3. Marketing plan implementation
CLASSIC EXAMPLES OF NEW
MARKET OFFERINGS
VIDEO / AUDIO IPODS
CELLULAR TELEPHONES
I MATS
ATM CARDS FROM FOREIGN BANKS
SKIN / HAIR CARE PRODUCTS
MULTI FUNCTIONALS COMPUTERS /
PRINTERS
HINDERANCE FACTORS IN NEW
PRODUCTS DEVELOPMENT
Shortage of ideas in FMCG
Higher R & D cost
Shorter product life cycle
ORGANIZATIONAL
ARRANGEMENTS
Budgeting for new products development
Organizing new products development
NEW PRODUCT
DEVELOPMENT
DECISION PROCESS
Idea generation
Called concept generation or ideation
Ideas obtained from customers by
employing user innovation
Ideas obtained from R&D etc
Major 2 sources of new product ideas
Idea screening
Second step and first decision to spend
resources
Example
Two types of errors must be avoided; go
and drop
Three questions considered by the screeners
Concept development and
Testing
Concept development:
Develop marketing and engineering details
Example
Concept testing:
Concept statement presented to consumers for their
reactions
Example
Concept should be communicated in the form of verbal
description, sketch, photograph, physical appearance,
prototype etc.
Customers are asked questions so as to check whether the
concept has strong appeal
Marketing strategy
development
Designing a marketing strategy for new product
based on product concept
This stage considers three parts:
First-target market size, sales and profit goals for
first few years
Second-planned price, distribution strategy for
first year
Third-long run sales and marketing mix strategy
Business Analysis
A review of sales, profits and cost projections
of the new product
Estimating total sales
Estimating costs and profits
Product Development
Developing the product concept into
physical product
R&D designs a prototype, that can be
produced quickly at budgeted cost
Example of a mouthwash
After prototype-alpha and beta testing
Market testing
The product and marketing program tested
in a more realistic market settings
Product is ready to be dressed up with a
brand name and packaging and put into
market testing
Three major methods-standard, controlled
and simulated test markets
Commercialization
Introducing a new product into market
Company faces high costs, may also have to
spent on advertising and sales promotion
Three things taken into consideration:
-when
-where
-to whom
Consumer Adoption Process