new product innovation
TRANSCRIPT
NEW PRODUCT INNOVATION
Agenda
Product Development Market Research Concept Testing Prototype Development Market Testing Product Launch Discussion
Why New Products?
New product development is critical to long-term success
Approximately one-third of the revenue a business generates is coming from products they did not sell five years ago
Changing environment creates new demands and needs
Product Development
Must be alert to quickly develop opportunities Focus on markets or product categories
consistent with organization’s objectives, resources, capabilities and strengths
Securing a competitive advantage
New Products
A way of getting new and keeping old customers
Effective way of obtaining a competitive advantage
Source of growth and excitement
New Product Categories
New to the world products New product lines Product line extensions Improvements and revisions to existing
products Repositionings Cost reductions
Product Development Process
Marketing Research
Very important to product development success
Key to successful marketing is imaginative, effective, creative communication
Find a need and fill it.
Marketing Strategies
Increase the number of customers Increase the average transaction Increase the frequency of repurchase
Marketing Concepts
Consumer orientation Customer service orientation Profit orientation Society
Marketing Mix
Product
Price
Promotion
Placement
Market Research
Who is my target audience? Are there enough members of this target group
to make the business worthwhile? How large is the potential market and how much
of that potential market can I capture? Who is my competition and what would make
someone choose my product over their current?
Researching Market Opportunity and Threats
Economic Realities•GNP•Disposable Income
Legal & Regulatory Condition•Laws•Regulations
Societal Focus•Population Shifts•Values•Attitudes•Competition•Trends
Technological Development•Advance in technology•Market receptiveness to technology
Market Placement
Identify target markets Size and growth potential Ability and ease of reaching segment Good fit with organizational objectives Greatest revenue generation with least
investment
Market Research – Pricing Strategies
Goal is to achieve a target profit Can you hold a product’s manufacturing costs
down to less than 25% of its perceived value? (example 100 $ perception 75$ cost of
production) Estimating manufacturing costs
Obtain price quotes from several suppliers
Concept Testing
Determine Critical success factors Financial objectives Marketing mix strategies
Product, Pricing, Promotion, Placement Marketing plan initiatives
Activity, Budget, Timing
Prototype and Test Marketing
Survey end-users Do you prefer this product over your current
product? Does this product meet the need you thought it
would? Does the way the product works provide an
important benefit? Would you consider buying this product? What improvements would you like added to this
product?
Reasons For New Product Failures
Poor marketing research Technical problems Insufficient marketing effort Bad timing
Launch Plan
Audit Challenge and refine assumptions from current
plan Evaluate success for input into next year’s plan Revise plan for new year incorporating marketplace
learning's, marketing insights and current plan successes
Summary
New product development drives growth Market research is critical to the success of a
new product launch Market research is a continuous process as
customer needs, your business and the environment changes