© 2002 mcgraw-hill companies, inc., mcgraw-hill/irwin developing new products and services

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

DEVELOPING NEW PRODUCTS

AND SERVICES

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

• Product Line and Product Mix

• Classifying Products• Type of User

Consumer goods Business goods

• Degree of Tangibility

• Services and New-Product Development

THE VARIATIONS OF PRODUCTS

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• Classification of Consumer Goods Convenience goods Shopping goods Specialty goods Unsought goods

CLASSIFYING CONSUMERAND BUSINESS GOODS

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Classification of consumer goodsClassification of consumer goods

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• Classification of Business Goods Production Goods Support Goods Installations Accessory Equipment Supplies Services

CLASSIFYING CONSUMERAND BUSINESS GOODS

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• What is a New Product?• Newness Compared with Existing Products

• Newness in Legal Terms

• Newness from the Company’s Perspective

• Newness from the Consumer’s Perspective

NEW PRODUCTS AND WHY THEY SUCCEED AND FAIL

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Consumption effects define newnessConsumption effects define newness

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• Marketing Reasons for Failures Insignificant “point of difference” Incomplete market and product definition

(Protocol) Too little market attractiveness Poor execution of the marketing mix Poor product quality or sensitivity Bad timing No economical access to buyers

NEW PRODUCTS AND WHY THEY SUCCEED AND FAIL

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

NEW-PRODUCT PROCESS

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• New-Product Strategy Development• Objectives of the Stage: Identify Markets

and Strategic Roles

• 3M: Cross-Functional Teams, Six Sigma, and Lead Users

THE NEW-PRODUCT PROCESS

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

• Idea Generation• Customer and Supplier Suggestions

• Employee and Co-Worker Suggestions

• Research and Development Breakthroughs

• Competitive Products

THE NEW-PRODUCT PROCESS

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• Screening and Evaluation• Internal Approach

• External Approach

THE NEW-PRODUCT PROCESS

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• Business Analysis

• Development

• Market Testing• Test Marketing

THE NEW-PRODUCT PROCESS

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Six important U.S. test marketsSix important U.S. test markets

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• Market Testing • Simulated Test Markets

• When Test Markets Don’t Work

THE NEW-PRODUCT PROCESS

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• Commercialization• Burger King’s French Fries: The

Complexities of Commercialization

• The Risks and Uncertainties of the Commercialization Stage Slotting fee Failure fee

• Speed as a Factor in New-Product Process

THE NEW-PRODUCT PROCESS

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Marketing Marketing information and information and methods methods used in the new-used in the new-product processproduct process