The Impact of New Product Development On The Growth of A Firm

THE IMPACT OF NEW PRODUCT DEVELOMENT ON THE GROWTH
OF A FIRM
(A CASE STUDY OF NIGERIA BREWERIES PLC ABA, ABIA STATE)
BY
AMADI GODWIN.C.
FPN/S01 /2007/2008/HMKT 545
A RESSEARCH PROJECT PRESENTED TO THE DEPARTIMENT OF
MARKETING SCHOOL OF BUSINESS AND STUDIES,
FEDERAL POLYTECHNIC NASSARAWA,
P. M. B. 001, NASARAWA, NASSARAWA STAE.
IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE
AWARD OF HIGHER NATIONAL DIPLOMA (HND) IN MARKETING
AUGUST, 2009
i
APPROVAL PAGE
This project report has been read and approved as satisfying the
requirement for the award of Higher National Diploma (HND) in the
department of marketing, federal polytechnic Nasarawa, Nasarawa
State.
By:
MALLAM MUHAMMAD YERO DATE

PROJECT SUPERVISOR
MR J.T SOLOMON DATE

HEAD OF DEPARTMENT
M.O. ODE
EXTERNAL EXAMINER DATE
ii
CERTIFICATION PAGE
This is to certify that this research was the original work done by Amadi
Godwin .C.
In award of higher National Diploma (H.N.D) in making.
MR J.T. SOLOMON DATE

HEAD OF DEPARTMENT
MALLAM MUHAMMED YERO DATE

PROJECT SUPERVISOR
MR J.T. SOLOMON DATE

PROJECT COORDINATOR
MR M.O. ODE DATE

EXTERNAL EXAMINER
iii
DEDICATION
This research work is dedicated to my Father which is in heaven. The
soon coming king.
iv
ACKNOWLEDGEMENT
First of all, I thank the almighty God for all his mercies, kindness,
protections, and salvation unto my soul.
I will be eternally grateful to my parents Mr. & Mrs. G.U. Ekwonye who
gave me sound education to HND level. Thank you so much for your
love.
I am indebted to my dear sister Oluchi A. Amadi who devoted her
time, useful advice, and money to the success of my H.N.D program.
Many thanks to my beloved brothers and sisters in Amadi’s family,
Mr. Solomon, Mr. Wisdom (Alias Wise), Mr. Prince – Chima (Alias Notin-
de-happen), Anty Stella, Aunty Peace, Anty Blessing & Precious. You are
indeed Papa’s Children. May God bless you all for your wonderful
encouragement and support.
Phill, Madam Mimi, My queen & princess, pastor Bassy, evang.
Rufus, Mr. eke, all St Peter youths/ members, all scripture union
members (SU), all EFAC member and all NIFES members: It is difficult
to put into words what you are to me, I tried to but could not. May Jesus
richly bless you people Amen.
My appreciation also goes to my Project supervisor, Mal.
Muhammued Yero and other departmental lecturers, Mal. Suleiman
Yero, Mal. Ibrahim Abubakar, Mr. Rowland Ezenwugo, Mr. J.T. Solomon,
Mr. Kuffery Iyang, Mrs. Monica Rowland, Mr. Iliya Bawa and non
departmental staff as well, also the Federal Polytechnic Library Staff.
v
ABSTRACT
The success of an organization lies on their ability to develop new

products, innovate, and effectively establish the new product
development. The objective of this study basically focuses on the impact
of a new product development on the growth of a firm (A case study of
Nigeria Breweries Plc Aba, Abia State). In the subsequent chapters, we
will look into the meaning of new product development, factors militating
against it, and its influences / impacts on the growth of a firm.
LIST OF TABLE
vi
TABLE ONE: Qualification of the company staff
TABLE TWO: The experience of the workers.
TABLE THREE: The Company do not carry out research always
TABLE FOUR: The interval of the research
TABLE FIVE: The amount budgeted for research.
TABLE SIX: Inadequate research is a problem to the
company
TABLE SEVEN: Government inspects the company’s products.
TABLE EIGHT: Government policies affect the company’s new
product development.
TABLE NINE: The Company acquire loan from banks and other
external means
TABLE TEN: The rate of interest on loan
TABLE ELEVEN: Acquiring loan from other means at 30% is a
problem to the Nigeria Breweries plc
TABLE TWELVE: Does inadequate training hinder the growth of
your company?
TABLE THIRTEEN: Does training improve new product development.
TABLE FOURTEEN: Does new development increase the sales
volume of the volume of the firm?
TABLE FIFTEEN: Does new product development increase its
market shares
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TABLE OF CONTENTS
Title Page……………………………………………………………….i
Approval Page………………………………………………………....ii
Certification…………………………………………………………….iii
Dedication……………………………………………………………...iv
Acknowledgment……………………………………………………….v
Abstract…………………………………………………………………vi
List of Tables…………………………………………………………...vii
Table of Content……………………………………………………….viii
CHAPTER ONE: INTRODUCTION/BACKGROUND OF STUDY
1.0 Introduction………………………………………………………1
1.1 Background of Study……………………………………………1
1.2 Statement of the Problem………………………………………5
1.3 Purpose and Objective of the Study…………………………..6
1.4 Research Questions……………………………………………7
1.5 Significance of the Study………………………………………7
1.6 Scope and Limitation of the Study…………………………….8
1.7 Research Hypothesis…………………………………………..9
1.8 Definition of Terms……………………………………………..10
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CHAPTER TWO: LITERATURE REVIEW
2.0 Literature review…………………………………………………13
2.1 New product development……………………………………...13
2.2 Type of new product development………………………….....14
2.3 Product planning and product development…………………..15
2.4 Why new products are developed……………………………...17
2.5 Why new products fail or succeed……………………………...17
2.6 Organizational arrangement of handling
new product development………………………………………..19
2.7 From planning to commercialization……………………..……...22
2.8 The product development process………………………………26
2.9 The concept of product life cycle………………………………...28
2.10 The concept of innovation………………………………………...31
2.11 What brings about diffusion and adoption influences………….34
Reference…………………………………………………………..39
CHAPTER THREE: RESEARCH METHODOLOGY
3.0 Research Methodology…………………………………………..40
3.1 Sampling Unit / Frame……………………………………………40
3.2 Sampling Method…………………………………………………41
3.3 Determination of Sample Size…………………………………..41
3.4 Method of Date Collection………………………………………42
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3.5 Method of Questionnaire Development and Collection……...42
CHAPER FOUR: DATA PRESENTATION & ANALYSIS
4.0 Data Presentation and Analysis………………………………..43
4.1 Respondents Characteristics and Classifications…………….43
4.2 Data Analysis and Interpretation………………………………..43
4.3 Test of Hypothesis………………………………………………..52
4.4 Discussions of Findings………………………………………….60
CHAPTER FIVE: SUMMARY, CONCLUSION & RECOMMENDATION
5.1 Summary…………………………………………………………..62
5.2 Conclusion…………………………………………………………63
5.3 Recommendation…………………………………………………63
Reference………………………………………………………….65
Appendix…………………………………………………………...66
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CHAPTER ONE
1.0 INTRODUCTION / BACKGROUND OF THE STUDY
As human beings have always sought for growth and development
all through their lives span also an organizational product. A good,
service, idea that is perceived by same potential customers as new
are a new product. It may be through innovation, imitation or
renovation. In this piece of work, the researcher will concentrate on
the impact of new product development on the growth of a firm.
The researcher will also look at how new product development
determines both the levels of economic growth and standard of
living of citizens.
1.1 BACKGROUND OF THE STUDY
New product development is one of the avenues of enlarging the
size of the product port folio of any organization, increasing its
sales volume and enlarging its financial strength. Many
organizations seems not to have recorded much success as a
result of depressed economic situation. It is imperative to
recognize the fact that necessity give birth to invention or
innovation, and for an organization to avoid being forced out of
the market, it has to innovate.
1
New product development is important in a competitive market
like that of Nigeria. It determines both the levels of economic
growth and standard of living of the citizens. Most products in the
markets today have undergone changes over times.
According to Mr. Roland’s Lecture note, new product has been
seen as the life blood of any organization. This is because seizing
new opportunities as they emerge is a way to increasing profits.
This means that a firm with a successful new products gives it the
chance of creaming off large profit before effective competition
develops. Every company must develop new product because
new products shapes the company’s future. Replacement product
must be created to maintain or build sales. Customers want new
products and firms will do their best to supply them. Companies
that fail to develop new products are putting themselves at great
risk.
Developing and managing products is critical to organization’s
survival and growth. Although several organizational approaches
to product management are possibly the share common activity
functions, and decisions necessary to guide a product through its
2
life cycle. Product managers coordinate efforts and become the
strategic centre for the product in all markets.
Marketing managers focuses on products for specific market. A
venture team is sometimes used to develop new products.
Members of the venture team come from different functional area
within an organization and have authority to execute plans.
Product planning requires the coordination of such functional
areas such research and development, production and
engineering, research and finance, accounting and marketing.
Each of these areas of departments has functional authority over
some aspects of the product.
To maximize the effectiveness of a product mix, an organization
usually has to alter its mix through such methods as new product
or the development of existing product deletion of a product, or
the development of a new product. Product modification refers to
changing one or more of a products characteristics. This approach
to altering a product mix can be effective when the product is
modifiable, when customers can perceive the change, and when
the modification is desired by consumer. Products can be
changed through the quality, functional or style modifications.
3
New product development involves generating idea, screening to
determine which idea to develop, expounding an idea through
business analysis, test marketing and commercialization. The
decision to enter the commercialization phase means that the
product has gotten to its full scale of production and that a
complete marketing strategy has been developed. The adoption
process by which the buyers go through in accepting a product
include; awareness, interest, evaluation, trial and adoption.
The process of a company in new product requires the
establishment of effective organization for managing the new
product development process. The development of new product
helps in improving the satisfaction of the consumers.
Therefore, this research is investigated on the impact of new
product development on the growth of firm using Nigeria
Breweries Plc Aba, Abia State as a case study. This industry
produces both alcoholic and non-alcoholic drinks; the alcoholic
drinks are: Star Larger Beer produced in1949, Gulder Larger
produced in 1970, Heineken re-launched in 1998, Legend Extra
Stout produced in 1992, Gulder Max Larger Beer produced in
2006. Their non-alcoholic drinks are: Maltina Bottle drink
4
produced in 1976, Amstel malta produced in 1994, Maltina sip – it
produced in 2005, Fayrouz produce in 2006.
There has been also a acute problems militating against the
standard of new produce development in the Nigeria Breweries
Plc Aba and other related firms.
Consequently, the standard of new product development is limited
to the following problems; lack of research or the on made is
inadequate, lack of capital, government policies, lack of training
among personnel’s.
Therefore, proper production management should be maintained
to improve or encourage new product development on the growth
of Nigeria Breweries Plc.
1.2 STATEMENT OF PROBLEM
New product development has contributed much to the growth and
survival of Nigeria Breweries Plc and has also suffered many
problems. Therefore, this research work is designed to critically
evaluate the problems of a new product development which are as
follows;
5
1. Lack of research or the inability of the management to find out
what the consumers need.
2. failure to find out the government rules and regulations
3. Lack of training programme; Failure to train marketing personnel
for new product and new markets.
4. Lack of Capital: The company cannot raise fund needed for new
product development when there is new ideas.
1.3 PURPOSE AND OBJECTIVE OF THE STUDY
The purpose of the research is to study the impact of new product
development on the growth of Nigeria Breweries Plc Aba. The
research study was designed to enable the researcher and the
firm;
1. To determine the importance of research findings on the growth of
Nigeria Breweries Plc.
2. To determine the relationship between government policies and
new product development.
3. To examine how inadequate training programmed affects new
4. Examine the criteria in granting loans For external finding of new
6
5. To recommend ways Nigeria Breweries Plc could improve the new
1.4 RESEARCH QUESTION
Based on the statement of the problem, the objective and
statement of the project, the following research questions were
advanced;
1. Does inadequate research affect new product development?
2. What is the relationship between the government policies and new
product development?
3. What is the relationship between inadequate training programme
and new product development?.
4. What is the relationship between finance and the expansion of new
product development ?
1.5 SIGNIFICANCE OF THE STUDY
This research is counted on the impact of new product
development on the growth of a firm Nigeria Breweries Plc Aba.
This research work will go a long way in helping the following;
1. The Researcher: - It will enable the researcher to ascertain the
problems involved in the cost of developing a new product.
7
2. The Firm: - This research work will help the Nigeria Breweries Plc
to identify the problems involved in the development of a new
product and also suggests the everlasting solution to them. It will
also help the firm to increase its sales volume, profit and market
share.
3. The Society: - This project work has gone deep to assist the
economy by increasing Job opportunities for the young graduates.
It will also help to develop marketing in the economy environment
both domestic and international.
1.6 SCOPE AND LIMITATION OF THE STUDY
In the cause of this study, the researcher uses senior, middle, and
Junior staff of Nigeria Breweries’ products, from four (4) selected
L.G.A. in Abia State, which include Aba North, Aba south,
Osisioma Ngwa, Isialangwa South.
However, in trying to make this research work a successful one by
enquiring relative information, the researcher encountered the
following constraints;
1. Time: - The time allowed for this research work is not enough for
intensive study of the project.
8
2. Finance: - Shortage of fund also limited the researcher to only
four (4) local government areas as well as restricting him into
printing and administering questions to the selected few among
the senior, middle and junior classes of the company’s staff.
1.7 RESEARCH HYPOTHESIS
Hypothesis is a tentative statement about the universe which may
or may not be true. For the purpose of this research work, the
following hypothesis is considered;
HYPOTHESIS ONE:
HO: Inadequate research does not affect new product
development.
HI: Inadequate research affects new product development.
HYPOTHESIS TWO:
HO: There is no relationship between government policies and
product development
HI: There is no relationship between government policies and new
9
HYPOTHESIS THREE:
HO: There is no relationship between new product development
and inadequate training.
HI: There is relationship between new product development and
inadequate training.
HYPOTHESIS FOUR:
HO: Finance procurement is not a problem to new product
development.
HI: Finance procurement is a problem to new product
development.
1.8 DEFINITION OF TERMS
To avoid misinterpretation of any aspect of this work, it becomes
necessary to the researcher to define some of the essential terms
used in this work.
These terms therefore should be understood as follows:
Product: This is one of the elements of marketing mix that
represents the basic offering being made to consumers. It is also
everything (both favourable and unfavourable) that one receives
as an exchange; it is a complexity of tangible and intangible
10
attributed, including functional, social, and psychological utilities or
benefits. A product may be a good, services, or an idea.
Marketing Mix: This consists of four (4) major variables in
marketing, which serves as pillars that makes marketing to stand
well; they are product, place, price, and promotion. It is also called
the 4P’s and marketing elements
Marketing Strategy: This is the process of determining a target
market and choosing the marketing mix variables needed to
maximize satisfaction of those consumers. It is also the set of
objectives which an organization allocates to its functions in order
to support the overall corporate strategy, together with the broad
methods chosen to achieve these objectives.
Innovation: This is the process of producing something new
inform of product or service that someone or any company has
never produced it before. It is also refers to any good, service or
idea that is preserved by someone as new.
Research: This is an organized way of finding valid or useful
information about a particular domain or phenomenon in an
environment with a set of objectives. It can also be described as a
thorough investigation or in-depth search for the causes of any
problem within intention of preferring solutions.
11
Commercialization: This is one of the product development
stages in which the product is first submitted to the market and
thus commences its life styles.
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CHAPTER TWO
2.0 LITERATURE REVIEW
2.1 WHAT IS A NEW PRODUCT
Perhaps the key criteria as to whether a given product is new are
how the intended market perceives it. If they buyers perceives that
a given item is significantly different (from competitive goods being
replaced in some characteristic appearance / performance) then
that product is a new product.
New product development according to John (1981 P. 233) “Is the
creation and adjustment of goods and services to satisfy customer
demands”. In creating and adjusting products to satisfy customer
demands, management should realize that it is primary in the
business of providing satisfaction. People spend their money to
attain satisfaction and not the specific technical characteristics of
the item being purchased. It is for this reason that marketing
research into the needs and desires of intended market is so
highly important to product development.
13
2.2 TYPES OF PRODUCT DEVELOPMENT
Product development is not limited to the creation of new products.
In fact, there are three basic types of product development
activities;
1. Development of new products
2. Improvement of existing products
3. Determination of new uses for existing products.
According to Kotler (1988 P. 428) if the product concept passes the
business test, it moves to R & D and or engineering to be
developed into a physical product. Up till now, it has existing only
as a word description, a drawing or a very crude mock-up. This
step calls for a large jump in investment which dwarfs the idea
evaluation costs incurred in the earlier stages. This stage will
answer whether the product idea can be translated into a
technically and commercially feasible product. If not the company’s
accumulated investment will be lost except for any useful
information gained in the process.
The R&D department will develop one or more physical version of
the product concept. It hopes to find a prototype that satisfies the
following criteria.
14
1. The consumers see it as an embodying the key attributes
described in the product concept statement.
2. The prototype performs safely under normal use and conditions.
3. The prototype can be produced for the budgeted manufacturing
costs.
Developing a successful prototype can take days, weeks, months,
or even years before it could be effective. So also in designing a
new commercial average for example, will take several years of
development word. Even developing a new test formula can take
time also.
2.3 PRODUCT PLANNING AND PRODUCT DEVELOPMENT
According to Stanton (1978 P. 167) product planning embraces all
activities that enable a company to determine what product it will
market. Adeyemi M.A. (2004 P. 316) see product planning as the
process that involves screening new product ideas, testing their
feasibility in the market, and planning a programme to market
them.
Product development, a more limited encompasses the technical
activities of products research engineering and design more
15
specially the combined slope of product planning and product
development includes marketing decisions in the following areas
1. Which product should the firm make and which should it buy?
2. Should the company market more or fewer product?
3. What brand, package and label should be used for each product?
4. What new use is there for new product?
5. How should the product be styled and materials should it be
produced?
6. In what quantities should each item be produced?
7. How should the product the product be priced?
Once a company has carefully segmented the market, chosen its
target customers, identified their needs and determined its market
positioning, it will now be easy for her to develop a new product.
However, market plays a key role in the new product process by
identifying and evaluating new product ideas and working with
R&D and others in every stages of development.
Every company must develop new products because new product
shapes the company’s future. A company can add new products
through acquisition routes which can take three firms; buying a
16
license, buying from other companies, or Franchise from other
company.
2.4 WHY NEW PRODUCTS ARE DEVELOPED
Pride (1984) said that new products are developed and introduced
into the market for the following reasons:
1. To meet the customer’s needs and wants which are dynamic in
nature.
2. Companies develops new product in order to explore the
opportunity that is available to them.
3. New products are developed so as to tight competitors in the
market.
4. New products are been developed to ensure continuity of any
business ventures through making utilization of the idle and
excess capacity thereby making better profit.
5. New product development increases the total sales volume of the
firm.
6. It also increases its market share.
2.5 WHY NEW PRODUCTS FAIL OR SUCCEED
Kotler (2003 P. 351) why do some products fail, while others seem
to succeed? In one of his survey, the respondent executives gave
17
the following reasons listed in order of frequency of mention for the
failure of new products (the 125 firms surveyed were considered to
be successful product innovators).
1. Inadequate market analysis over estimating potentials sales of the
new product, inability to determine buying motives and habits, and
misjudgments as to what products the market wanted in regards to
research.
2. Lack of training programme; failure to train marketing personnel for
new products and new markets.
3. Government policy; government constraints new products have to
satisfy consumer safety and environmental concerns.
4. Lack of capital; inadequate supply of money to some companies
with ideas but cannot raise fund to research launch and even
produce.
5. Shorter product life cycle; when a new product is successful, rivals
is quick to copy it. For example, Sony used to enjoy a three year
lead on its new products before others starts copying but now
Matsus hita will copy the product within six months, leaving hardly
enough time for Sony, to recoup its investment.
6. Fragmented markets companies have to aim their new products at
smaller market segment and this can mean lower sales and profits
for each product.
18
7. Poor timing of introduction: The usual mistake here is to introduce
a product too late to the market, although in most cases the
problem is premature market entry.
2.5 ORGANIZATIONAL ARRANGEMENT OF HANDLING NEW
PRODUCT DEVELOPMENT
Robert (1978 P.29) observes that depending on the organization of
an organization most companies have product branch manager
who co-ordinates the new product ideas before going to the
product manager. In some companies, the following are the
responsibilities of new product::
1. Product Manager: - An average organization may have full
section of the department known as the product development in
the company
President
Executive Vice President
V.P of V.P of V.P of V.P of V.P of

Marketing Finance manufacturing personnel Research & development
Sales Production Marketing research Sales Advertising

manager manager manager promotion Manager
TRADITIONAL ORGANIZATION AND THE PRODUCT MANAGER

SOURCE: Robert, D. Histrictt, Marketing a new product (The Macmillan Press 2 nd Edition, (1978)
19
2. New Product Department: - This takes in change of developing
new ideas and coordinating research both within and outside the
company for the product. Multidivisional firms may choose the new
product development organization. Some department have also
been labeled new product development department. This
organizational structures, separates new product development
planning and management tasks from the existing divisions in the
organization to centralize the new product decision-making
process and eliminates redundancy of these tasks across
divisions. This consists of part of the product developments like
sourcing for minor ideas within the company. This is normally
carried out where there one different managers in the production
development department.
President
Executive Vice President
Research & development Legal President New product
Finance Engineering Production Marketing
RELATIONSHIP OF NEW PRODUCT DEPARTMENT AND OTHER DEPARTMENT

20
3. New Product Committee: This is responsible for one department
and not for all angle of the organization. This stands as a
department taking the responsibility of new product development.
4. The Venture Team: According to Robert (1978 P. 40), this type of
organization is not a new approach to new product development. It
seems to be better suited to the design and development of new
product that do not necessarily fit into the ongoing business of the
firm. A study of 98 venture managers for industrial and consumer
products at large corporations characteristics;
1. The venture team is organizationally separated from the remainder
of the organization.
2. Members are as revived from various functional areas such as
engineering, production, marketing, and finance
3. Existing lines of authority in the permanent organization are not
necessarily valid in the venture team.
4. The venture team manager usually reports to chief executive and
is given authority to major decisions.
5. The team is free of deadline and remains together until the task is
completed.
6. Freedom from time pressure fosters creativity and innovation.

To Management
New venture division Central Television Application Solid state

research & division division division
development 21
Venture Production Marketing Engineering Finance
team A
Venture
team B
SOLID LINES PERMANENT ORGANIZATION DOWTED LINE VENTURE

TEAM MINUTES
2.7 FROM PLANNING TO COMMERCIALIZATION
Robert (1978 P. 43) says that new product planning and
development organization often has difficulties in maintaining a
balance of emphasis between existing products in various stages
of development. Why does the preoccupation of operating
personnel with products already on the market cause difficulty in
generating interest in new product plans? Personnel in the
planning development stage do not always participate in the
product commercialization. Once commercialization is reached,
the planning personnel continues to plan and develop new
products. The problems of transferring knowledge from planning to
operation is frequently encountered but may be resolved by
allowing development personnel o move into operations. This
problem is not as great in the product manager of organization
because the product once it achieves commercialization. With the
22
committee, new product department, and possibly the venture
team, this transfer of knowledge may be a more serious problem
since those groups are not likely to participate in the market
introduction. This responsibility would be given to the marketing
department. The problem of knowledge transfer, role conflict,
insufficient authority and so on may be minimized or eliminated
completely if the firm and its employees maintains a positive
attitude towards new product planning and development. A positive
attitude will help to ensure the success of any of the four
organizational structures.
THE RESEARCH AND DEVELOPMENT / MARKETING
INTERFACE
According to Robert (1978 P. 44), Those individuals responsible for
new product planning and development must interest with
research and development in order to ensure the technical
feasibility of any new product idea, as well as to determine the
actual specification required for consumer satisfaction. This
interaction often breaks down for two reasons;
1. Lack of good communication during relevant stages in the product
evolution process.
23
2. Value conflict between the research and development group and
marketing personnel.
The First problem occur because research and development has
difficult responsibility of explaining the new technology used in the
new product development to the marketing staff. New designs,
materials, and procedure that must be clearly communicated to
those in the new product development organization are constantly
being developed. It is also imperative that research and
development groups be kept informed of the long-rage goals of the
firm in the marketing of new products so that effort is congruent
with these objectives.
Value conflict primarily because the researched development has
little appreciation for problems in branding, packaging, distribution,
pricing and promotion, and it must be instilled with awareness and
understanding of how the problems faced by marketing
organization affects the success of nay new product introduction.
Flexibility in managing role of research and development seems to
be the key to a successful cooperation. Communication and
understanding of the problems faced by each member will help to
minimize the conflict of interest. Frequent meetings and careful
scheduling will also aid in this inter face.
24
IDEA GENERATION
New product development according to Anozie (2005) call for
generation of a large and interesting pool of possible product ideas
with a view to finding better ones. The greater the number of ideas
generated, the better the ones are lovely to be found. Anozie
(2005) further stated some sources of new product ideas as
follows:
1. Customers: - According to Anozie, the market concept demands
that the search for a new product ideas should start with the
identification of customer’s needs and wants. Ways of identifying
customer’s needs and wants are; Direct customer surveys,
Projective tests, focused group discussions, suggestion systems
and letters received from customers, and perpetual and
preferential mapping of the current product space to discern new
opportunities.
2. Scientists: - Use of research labs for basic research e.g.
production of TV and transistors, new forms of packaging was as a
result of research into solid state physics some companies exploit
the basic technology to search for minor modifications of existing
products.
25
3. Competitors: - Competitors must watch the new product
development by companies. Marketing intelligence can come from
distributors, suppliers, and salesmen of the new product.
4. Company Salesmen and Dealers: - They are good sources of
product ideas because they have first experienced the customer’s
unsatisfied needs and complaints. They are often the first to learn
of the competitive developments.
5. Top Management: They can help by defining those product
market areas of greatest interest in which the new product is
needed.
2.8 THE PRODUCT DEVELOPMENT PROCESS
Given some of the major issues historically confronted by firms in
developing new products and given the continued proliferation of
new consumer and industrial products in the lake 1970’s, 80’s and
90’s respectfully. It is therefore necessary that a firm develop new
products for commercialization.
According to Kotler (2004 P. 349) companies that fails to develop
new products are putting themselves at great risk. Their existing
products are vulnerable to changing customer needs and tastes,
26
new technologies, shortened product life cycles, and increased
domestic and foreign competition.
Kotler (2004 P. 356) typically listed the product development
process as follows;
1. Idea Generation: The process of generating new ideas may
consist of brain storming, reverse brainstorming, attribute costing
or problem inventory analysis.
2. Screening: Techniques for evaluating new ideas may consist of
checklist or open discussion where ideas are either eliminated or
considered further.
3. Business Analysis: The use of focus groups and concept as to
the exact nature of the idea before its prototype is made. This
analysis should also provide further evaluation of idea in order to
eliminate any of those not considered favourably at this point.
4. Development: Prototype development of the idea must be
evaluated in terms of production problems, safety requirement
costs, and other modifications necessary before entering any test
market.
5. Testing: The setting up of test markets can provide valuable data
on the nature of the market and needed marketing strategy
27
changes or product modification necessary to ensure a successful
launch.
6. Commercialization: The new product is launched into the market
at full-scale production with a significant commitment of the firm’s
resources and reputation.
2.9 THE CONCEPT OF PRODUCT LIFE CYCLE
A.K Arowomole & M.A. Adeyemi (2005) see product life cycle as a
marketing theory in which products or brands follow a sequence f
stages including: introduction, growth, maturity and sales declines.
According to Cunblitt and Still (1971), product life cycle begins
where the new product development process ends. Among many
writers observed that products are like living organisms during
which they pass through certain stages, which begins when the
product idea is conceived through the time it is introduced into the
market.
The product life cycle is a attempt to recognize distinct stages in
the sales history of the product. The plc concept is mostly used as
a framework for developing effective marketing strategies in
different stages of the product life cycle. The stages of this cycle
cannot necessary be predicted in terms of exact time nor can it be
28
claimed that a specified product life cycle must follow all of the
stages with no alternative. The stages of the product life cycle are
as follows according Kotler (2004) ;
1. The Introductory Stage: This is a period of slow growth as the
product is introduced in the market. And because it takes time to
roll out a new product and fill dealer pipelines, sales growth tends
to be slow at this stage. Profits are also nonexistence or negative
at this stage. Promotional expenditures are at their highest ratio to
sales because of the need to
i. Inform potential consumers, ii. Induce product trial, and iii.
Secure distribution in retail outlets. Prices tend to be high
because costs are high.
2. The Growth Stage: This is a period of rapid market acceptance
and substantial profit improvement. Early adopters like the product,
and additional consumers starts buying it. New competitors enter,
attracted by the opportunities. They introduce new product features
and expand distribution. Prices remains where they are or fall
slightly, depending on how fast demand increases. The product
attain sales momentum through favourable word of firm. Firms
have to watch for a change from an accelerating to a decelerating
rate of growth in order to prepare new strategies. So also market
29
expansion strategies would help strengthen the firm’s competitive
position.
3. Maturity Stage: This is a period of a slow down in sales growth
because the product has achieved acceptance by most potential
buyers. Profits stabilize or decline because of increased
competition. Most products poses formidable challenges to
marketing management. The maturity stage is divided into three
phases; growth, stable, and decaying maturity. In the first phase,
the sales growth rate start to decline. There are no new distribution
channel to fill. In the second phase, sales flatten on a per capital
basis because of the market saturation. Most potential consumers
have tried the product, and future sales are governed by
population growth on a replacement demand. In the third phase,
decaying maturity, the absolute level of sales starts to decline, and
customers begin switching to other products.
4. Decline Stage: This is the period when sales decline for a number
of reasons, including technological advances, shifts in consumer
tastes, and increased domestic and foreign competition. All lead to
over capacity, increased price cutting and profit erosion. The
marketing strategy relevant to this period is to identify the truly
declining products, develop for each strategy of continuation
through marketing mix, concentration that is concentrating its
30
resources only in the strongest markets and channels or milking
strategy – that is sharply reduces its marketing expenses to
increase its current profits. Finally, the company may phase out the
product in a way that minimizes the hardship to company profits,
employees and customers.
2.10 CONCEPT OF INNOVATION
According to M.A. Adeyemi & A.K Arowomole (2004 P. 183)
“Innovation is the process of producing something new inform of
product or services that someone or any company has never
produced it. It also refers to any good, service or idea that is
preserved by someone as new. Development of new products,
services or ways of working. Pride (1974) defines, innovation as
the creation of something new and different. In other words, there
should be a recognition of opportunity and the creation of product
to satisfy the newly found opportunity. This implies that there will
be an attempt at planned change, the planning of new products to
permit the constant introduction of profit making opportunity
through planned marketing efforts. More so, this definition
embraces original products, major modification of existing products
duplication of competitors products, and product-line acquisition of
all which involves addition of something new into the production.
31
Continuous innovation is the only way to a very product obsolence,
yet successful new product developments is hard to achieve.
Reasons are;
1. Shortage of important new product ideas. Shortage of
fundamentally new technologies needed for major innovation
to avoid economic stagnation.
2. Fragmented market; Competition leads to fragmented
markets. New products are directed to capture a large share
of a small segment instead of the main market.
3. Growing social and government constraints: New safety,
ecological compatibility and other government requirements
which have affected / slowed down the rate of innovation
decision in may industries.
4. Costliness of new product development process. A company
has to develop a great number of new product ideas in other
to have or find out a successful one.
5. High rate of product and services fall short of expectation
especially among the consumer product manufacturers.
6. Shortage life spans of successful products: The rate of cult
throat competition among rivals shortens drastically the life
spans of even commercially successful products.
32
IMPORTANCE OF PRODUCT INNOVATION
Anozie (2005) listed the following importance of product
innovation:
1. The advancement of technology and the proliferation of new goods
and services are visible in every industry or company,
consequently most of today’s products are bound to be replaced
sooner or later. Hence, the profitability and every survival of most
companies or industries depend essentially upon a continuing flow
of successful new product. Therefore, is the only response to the
dynamic society and technology which is subjects to continuous
change.
2. Companies are increasing dependently upon new products for the
maintenance expansion of sales.
3. Few products, if any, perfectly satisfy the needs and frequency
change. The major objective of product innovation is to modify
product or renovate products to satisfy the need of consumers at a
reduced cost. The successful execution of this policy generates
customer’s loyalty. As the need arises companies should quickly
replace their current declining product before competitors do it for
them.
33
2.11 WHAT BRINGS ABOUT DIFFUSION AND ADOPTION
INFLUENCES
According to Mr. Awa (2005 P. 124) “No two products holds equal
potential for consumer’s acceptance”. While some products (such
as Baby Pampers, Gala meat, Barbing Chipper, and shoes) is to
achieve consumers endorsement almost over-night, others (such
as Golden guinea, Begedoff Larger beer, 33 export larger and
many more) crumbled in the liquor shelf for one requiring different
information sources at each successive stage in the process.
Purchase time is very important in diffusion theory because the
average time a consumer takes to adopt an innovation is a
predicator of the overall length of time that will be required for the
new product to achieve widespread adoption.
CATEGORIES OF ADOPTERS
Rogers (1983) articulates that or defines a person’s innovativeness
on “the degree to which an individual is relatively earlier in
adopting new ideas than the other members of his social class or
system”. In each product area, there are pioneers and early
adopter. Roggers proposed an adoption categorization scheme
based on time by dividing adopters into five(5) categories of
innovations.
34
2½ Innovations
34% 34%
13½ Early Late
Early Majority Majority
Adopters 16% Laggards
THE SEQUENCE AND PROPORTION OF ADOPTER CATEGORIES

AMONG THE POPULATION THAT EVENTUALLY ADOPTS
SOURCE: Redrawn from Everrett M. Rogers, Diffusion of

Innovations (New York: The free press, 1983)
1. Innovations: These are first consumers to adopt new products.
They enjoy trying new products and tends to be venture some
trash and daring. They account for 2½ % and are technology
enthusiasts. In return for low prices, they are happy to conduct
alpha and beta testing and report on early weaknesses.
2. Early Adopters: They are guided by respect. They are opinion
leaders n their communities and adopts new ideas early but
carefully. They represents 13½ % after the innovators and are also
visionaries who search for new technologies that might give them
a dramatic competitive advantage. They are less price-sensitive
and willing to adopt the product if given personalized solutions and
good service support.
3. Early Majority: They are deliberate, they adopt new ideas before
the average person. They account for 34% and are pragmatists
35
who adopts the new technology hen its benefits are proven and a
lot of adoption has already taken place. They make up the main
stream market.
4. Late Majority: They are skeptical, they adopt and innovation only
after a majority have tried it. They account for 34% and are
conservative who are risk averse technologies shy, and price-
sensitive.
5. Laggards: They are traditionally bound; they are suspicious of
change, mix with other tradition bound people, and adopts the
innovation only when it takes on a measure of tradition itself. They
accounts for 16% who resists the innovation until the finds out that
the status quo is no longer defensible.
STAGES OF ADOPTION PROCESS
According to Roggers, the innovation diffusion process is the
spread of a new idea from its sources of invention or creation to its
ultimate users or adopters. The consumer – adoption process
therefore focuses on the mental process through which an
individual passes form first leaving about an innovation to final
adoption.
36
Adopters of new products have been observed to move through
five stages:
AWARENESS
INTEREST
EVALUATION
TRIAL
ADOPTION
STEPS IN THE ADOPTION PROCESS

SOURCE: KOTLER (2004)
Awareness: - At this stage, the consumer becomes aware of the
innovation but lacks information about it.
Interest: - When a consumer develops interest in the product or
product categories, he searches for information about how far the
innovation can help him solve his consumption related problems with
ease.
Evaluation: - The consumer considers whether to try the innovation
by assessing the available information in the light of the problems at
37
hand and thereby noting whether further information could be sought
to further reduce ht risk involved in the decision. Most consumers
evaluation are cognitively or mentally related and may involve the use
of models, especially where two or more brands are to be considered.
Trial: - The consumer tries the innovation to improve his or her
estimates of its value. Risk is always very high at the trial stage, but it
is often reduced by free samples, warranties and guarantees,
instruction books and many others.
Adoption: - The consumer decides to make full and regular use of
the innovation base on the satisfactory performance of the product at
the trial stage or favourable evaluation of the product innovation.
FACTORS INFLUENCING THE ADOPTION PROCESS
Marketers recognize the following characteristics of the adoption
process; the effects of personnal influence; differing rates of adoption;
and differences in organization’s readiness to try new products.
38
REFERENCE
Awa Okorie .H. (2005), “ Marketing Basic Concepts and Decision”

Igwurunta, Port-Harcourt, River State
A.K. Arowomole & M.A. Adeyemi (2004), “Compendium of Marketing

Terminologies”
Anozie E.E. (2003), “Product-mix and Brand Strategy” Owerri, Imo State.
Philip Kotler (2003), “Marketing Management Eleventh Edition” Prentice

Hall Indian Branch.
Pride, M. & Ferrell O.C. (1982), “Fundamentals of Marketing Honghton

CO. Boston
Robert, D. Hisrictt (1978) “Marketing a new product” London 2 nd Edition
Udell, J.G. (1981), “Marketing in an age of change” An introduction. John

Willey & sons. Inc. Canada
39
CHAPTER THREE
3.0 RESEARCH METHODOLOGY
In this chapter, the research has to discuss the methodology used
to carryout the research work. The main intention was on the following
research unit, sampling method, and sample size, method of collection
of data, method of questionnaire distributed, and data analysis.
3.1 SAMPLING UNIT/FRAME
The population of this research work consist the staff of Nigeria
Breweries PLC Aba, using four (4) selected local government areas in
Abia State.
70 staff both senior, middle, and junior classes were used from each
local government making the entire population 280. Among the local
government are:-
1. Aba – North 70
2. Osisioma - Ngwa 70
3. Aba - South 70
4. Nsialangwa – South 70
Total 280 staff
40
3.2 SAMPLE METHOD
To draw the sample from the sampling unit, the researcher
adopted probability sampling method. This method gives all the member
of the sample unit equal chance to being selected. In this way, every,
member is qualified and whether or not he she is selected is a matter of
chance. Therefore, sampling method.
3.3 DETERMINATION OF SAMPLE SIZE
The sample size of this work was using the staff of Nigeria
Breweries PLC, under Aba-North local government area by adopting
Yaro Yamea’s formula;
N = N
1+ n (e) 2
Where N = sample size E = level of significant, and N =
population size.
TAKING A SAMPLE ERROR OF 5% WHERE n = 70
N= 70 = 70
I + 70 (0.05)2 1 + 70 (0.0025)
N= 70 = 70
1+0.175 1.175 = 60
N = 60, therefore sample size = 60
41
3.4 METHOD OF DATA COLLECTION
The obtained fine the respondents through the use of
questionnaire and interview. Such respondents were the staff of Nigeria
Breweries PLC Aba.
SECONDARY DATA:- The research also made use of literature that are
related to the topic such as textbooks, journal, magazines and many
others.
3.5 METHOD OF QUESTIONNAIRES DISTRIBUTION AND
COLLECTION
The questionnaires were distributed personally Aba North local
government area. Sixty (60) questionnaires were structured and
administered to the senior, middle and junior classes of staff and the 60
questionnaires were retread.
TABLE 3.6
Respondent Number Distributed Number Retread %
Senior Staff 25 25 42
Middle Staff 20 20 33
Junior staff 15 15 25
Total 60 60 100
42
CHAPTER FOUR
4.0 DATA PRESENTATION AND ANALYSIS
The purpose of this chapter is to present and analysis the collected
data using them to proffer solution to the research questions as well as
test the hypothesis stated in chapter one of this work.
4.1 RESPONDENTS CHARACTERISTICS AND CLASSIFICATION
In analyzing the data collected, the researcher tread to the
examine the reliability of the data collected from the respondents. This
was based on the questionnaire distributed and returned. Therefore, the
purposes of this analysis, the questionnaire were used. However, sixty
(60) questionnaires were distributed and returned during the data
collection.
4.2 DATA ANALYSIS AND INTERPRETATION
TEST OF RESEARCH QUESTION
Question 1: Qualification: What is the qualification of your work?
43
TABLE 4.21: RESPONSES
RESPONSES NO. OF RESPONDENT PERCENTAGE
FSLC 5 8.30
JSS 4 6.70
SSCE 10 17.00
NCE 5 8030
OND 30 50.00
HND and ABOVE 6 10.00
TOTAL 60 100
INTERPRETATION: The analysis shows that 5 respondent or 8.3% are
FSLC workers, 4 or 6.7% respondent and SS workers, 10 or 17%
respondents are SSCE, 5 or 8.3% respondents are NCE, 30 or 50%
respondents are HND and above workers in the company.
QUESTION 2: EXPERIENCE: What is the experience of the company’s
worker’s?
44
TABLE 4.22 RESPONSES.
RESPONSES NO. RESPONDENTS PERCENTAGE

1 -2 15 25
2-3 15 25
3 and Above 30 50
Total 60 100
INTERPRETATION: - From the table 4.2 above shows that 15 or 25%
respondents were 1 – 2 years experience, 15 or 25% respondents were
2 – 3 years of experience while 30 or 50% were 3and above years of
experience in the company.
QUESTION 3: Does your company carry out research always?
TABLE 4.23 RESPONSES
Responses No. of Respondents Percentage

Yes 20 33.33%
No 40 66.66%
Total 60 100
INTERPRETATION: - From the above table, 20 or 33% respondents
said Yes while 100 or 67% said No.
Therefore, the company does not carry out research always.
QUESTION 4:- If yes, how many years interval do they carry out their
research?
45
TABLE 4.24 RESPONDENTS
Responses No of Respondents Percentage

2 years 10 17
3 years 20 33
5 years 30 50
Total 60 100
INTERPRETATION: - Table 4.4 above shows that 10 or 17% of the
respondents said 2 years, 20 or 33% said 3 years while 30 or 50% said
5 years.
Therefore, it was greed that the company carries out research in every 5
year intervals.
QUESTION 5: How much does your company dget for research?

Below N20, 000 40 67%
Above N20, 000 20 33%
Total 60 100
Interpretation: from the above table we see that 100 or 67% respondents
said that the company budget below N20, 000 for research while 20 or
33% respondents said that the company budget above N20, 000.
46
QUESTION 6: Is inadequate research a problem to new product
development on the growth of your company?
Responses No of respondents Percentage

Yes 43 72%
No 17 28%
Total 60 100
INTERPRETATION: - From the table above 43 or 72% of the
respondents said Yes, while 17 or 28% of the respondents said No.
QUESTION 7:- Does government agents? Make more to inspect your
products?

Yes 48 80%
No 12 20%
Total 60 100
INTERPRETATION: - In analyzing the table above 48 or 80% of the
respondents agreed that government agents inspect the company , while
12 or 20% of the respondents said No.
QUESTION 8: Does the government policies effect the development of
new product in your company?
47
Yes 35 58.33%
No 25 41.67%
Total 60 100
INTERPRETATION: - From the table above 35 or 58:33% of the
respondents agreed that government policies effects new product
development in the company, while the remaining 25 or 41.67% of the
respondents disagreed.
QUESTIONS 9:- Does you acquire loan from bank and other external
means?

Yes 35 58.33%
No 25 41.67%
Total 60 100
INTERPRETATION: - In analyzing whether the company acquire loan
from banks and other external means, 35 or 33% agreed that the
company acquire loan from banks and other sources, while 25 or 41%
disagreed.
QUESTION 10: What is the rate of the interest on the loan?

10% 5 8.33%
20 25 41.67%
30% 30 50%
Total 60 100
48
INTERPRETATION: - From table 4.10 above, 5 or 8.33% agreed at 20%
while 30 or 50% agreed at the rate of 30%.
QUESTION 11: In question “10” with interest rate of 30%, do you think
that acquiring external fund is or problem to the company?
TABLE 4.211 Responses

Yes 55 91.67%
No 5 8.33%
Total 60 100
INTERPRETATION: - From the above table, 55 or 91.67% of that
respondents said Yes to the question, while 5 or 8.33% said No.
QUESTION 12: Does inadequate training hinder the growth of your
company?

Yes 45 75%
No 15 25%
Total 60 100
INTERPRETATION: - From the above table, 45 or 75% agreed that
inadequate training hinder the growth of the company, while 15 or 25%
disagreed.
49
QUESTION 13: Does training improve new product development?
Response No of respondent Percentage

Yes 46 76.67%
No 14 23.33%
Total 60 100
INTERPRETATION: - From the above table, 46 or 76.67% of the
respondents agreed while 14 or 23.33% disagreed.
Question 14: Does new development increase the sales volume of the
firm?

Yes 44 73.3%
No 16 26.6%
Total 60 100
INTERPRETATION: - From the above table, 44 or 73.3% of the
respondent said Yes, while 16 or 26.6% of the respondents said No.
QUESTION 15: Does new product development increase its market
share?
Responses No of Respondent Percentage

Yes 50 83.33%
No 10 16.67%
50
Total 60 100
INTERPRETATION: - The table above shows that 50 or 83.33% of the
respondents said Yes to the question, while 10 or 16.67% said No to the
question.
4.3 TEST OF HYPOTHESIS
For proper presentation and analysis of the data collection, the
four hypothesis were tested where necessary, in order to rest the
hypothesis stated in chapter one. Using chi-square method:
Formula = C = RT X CT
GT
When, RT = Row total
CT = Column total
GT = Grand total
Therefore, formula for the chi-square x2 = (O – E)2

E
Where, x2 = chi-square
O = observed frequency
E = Expected value
The degree of freedom has to be determined by using this formula,
(R-I) (C-I)
51
Where, R = number of rows
C = number of columns
Therefore, we have DF = (2 -1) (3 – 1)
2 degree of freedom 1 x 2 = 2
The critical value of significance and degree of freedom 2 under 0.05 =
5.99.
DECISION RULE
The decision rule for the test statistics is to accept the alternative
(Hi) hypothesis if the computed value is higher than the critical value
5.99 and if not, accept the null hypothesis (Ho) and reject alternative (Hi)
hypothesis.
HYPOTHESIS ONE
HO: Inadequate research does not affect new product
development.
Hi: Inadequate research effect new product development.
QUESTIONNAIRE 4em 6
Table 4.31 actual Observation (O)
Responses Senior Staff Middle Class Junior Staff Total

Yes 17 18 8 43
No 2 5 10 17
Total 19 23 18 60
Table: 4.32 expected frequency (E)
52
Yes 13.62 16.48 12.9 43
No 5.38 6.52 5.1 17
Total 19 18 60
E = RT X CT
GT
Thus, the formula for the chi-square x2 = (O – E) 2

E
TABLE 4.33 Computation of the4 chi-square
(O – E)2
O E O–E (O – E)2
E
17 13.62 3.38 11.42 .085
2 5.38 -3-38 11.42 2.12
18 16.40 1.52 2.31 0.14
5 6.52 -1.52 2-31 0.35
8 12.9 -4.9 24.01 4.71
10 5.1 4.9 24.01 10.03
Decision rule: hence the computed value (10.03) of the chi-square is
greater than the critical value 5.99; we accept the alternative hypothesis
Hi and reject the null hypothesis Ho. Therefore the research
development.
HYPOTHESIS TWO
Ho: There is no relationship between the government policies and
53
Hi: There is relationship between the government and new product
development.
Table 4.34 Responses
Response Senior Staff Middle Class Junior staff Total

Yes 14 189 3 35
No 1 4 20 25
Total 15 22 23 60
Table 4.35 Expected frequency (E)
Response Senior Staff Middle Class Junior staff Total

Yes 8.75 12.83 13.42 35
No 6.25 9.17 9.58 25
Total 15 22 32 60
Table 4.36 Computation of the chi-square
O E O–E (O - E)2 (O – E)2

E
14 8.75 5.25 27.36 3.15
1 6.25 - 5.25 27.56 4.41
18 12.83 5.17 26.56 2.08
4 9.17 - 5.17 26.73 2.91
3 13.42 - 10.42 108.58 8.09
20 9.58 10.42 108.58 11.33
31.97
DECISION RULE
54
If x2 CD > x2, reject Ho and accept Hi therefore with the computed
value 31.97 which is higher than critical value 5.99, than the researcher
accepts that there is relationship between the government policies and
Test of Hypothesis there
Ho: there is no relationship between new product development and
inadequate training
Hi: There is relationship between new product development and
inadequate training.
Question 11 and 12
Table 4.37 Actual observation (O)

Yes 19 20 6 45
No 1 3 11 15
Total 20 23 17 60
Table 4.38 Expected frequency (E)

Yes 15 17.25 12.75 45
No 5 5.75 4.25 15
Total 20 23 17 60
55
Table 4.39 Computation of the chi-square
(O – E)2
O E OE (O – E)2
E
19 15 4 16 0.84
10 5 -4 16 32
20 17.25 2.75 7.56 0.44
3 5.75 - 2.75 7.56 1.32
6 12.75 - 6.75 45.56 3.57
11 4.25 6.75 45.56 10.72
20.07
DECISION RULE
Therefore, the researchers accept the Hi saying that there is
relationship between training and new product development.
HYPOTHESIS FOUR
Ho: Finance procurement is not a problem t new product
development
Hi: Finance procurement of a problem to new product
development.
Table 4.25 actual observation (O) 8 expected frequency

Yes 12 (8.17) 16 (11.080) 7 (15.75) 35
No 2 (5.83) 3 (7.92) 20 (11.25) 25
Total 14 19 27 60
56
Table 4.310 Computation of chi-square
(O – E)2
O E O–E (O – E)2
E
12 8.17 3.83 14.67 1.80
2 5.83 - 3.83 14.67 2.52
16 11.08 4.92 24.21 2.18
3 7.92 - 4.92 24.21 3.06
7 15.76 - 8.75 76.56 4.86
20 11.25 8.75 76.56 6.81
21.23
DECISION RULE
Hence, the computed value 21.23 of the chi-square is greater than
the critical value (5.99). We accept the alternative hypothesis (Hi) which
says that finance procurement is a problem to new product development.
4.4 DISCUSSION OF THE FINDING
From the analysis of findings on the impact of new product
development on the growth of a firm (a case study of Nigeria
Breweries Plc Aba, Abia State), the researcher discovered the
following findings:-
1. The staff of Nigerian breweries PLC, Aba Complained that
research and development department does not carry out
adequate research. That they unable to find out what the
consumers needs and wants are overestimating potential sales of
57
the new products, and enablement to determine the buying
motives and habits of the forget markets.
2. Lack of training programme. There is insufficient training
programme for the marketing personnel for new products and new
markets which effect the new product development of the
company.
3. Ineffective government policies and regulation by government
agents hinder the growth of the company there includes, the
inspection fees, taxes, levies, quality, dates of production and the
expiring dates.
4. Lack of Capital: The respondents complained that inadequate fund
is a problem to the new product development. Even when new
ideas were generated the management cannot raise money
needed for research, launch and even product.
5. That shorter product life cycle affects new product development in
the organization. The respondents also complained that most
products have shorter life cycles.
58
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 SUMMARY
Nigeria Breweries Abia Plc seems not to have recorded
much success as a result of depressed economic melt down. This
is because, they failed to recognize the fact that necessity gives
birth to invention or innovation. New product is indeed the life
blood of any organization and therefore stands as one of the
avenue of enlarging the size of the product portfolio of any
organization, increasing its sales volume and enlarging its financial
strength.
Once a company has segmented the market, chosen its
target customer groups and identified their needs and determined
59
its derived market positioning it is ready to develop and launch
appropriate new products.
Marketers should participate with other department in every
stage of new product development which are: idea generation,
screening analysis, development, testing and commercialization.
Finally, consumer’s adoption process also help on
organization to induce sales since it is the only way by which
customers learn about new products, try them, adopts or reject
them.
5.2 CONCLUSION
Conclusively, in reading through the chapters of this research
work, chapter one is expressly on the introduction of new product
development and most problems militating against them. Chapter
two tends to be more mature. It reviewed other authors write up on
the topic. Chapter three, the researcher stated the methods used
in data collection and distribution of questionnaire, which chapter
four was used to prove that all the research problems and
hypothesis stated in chapter one were true and real. This can be
seen through the response of the respondents from questionnaire
items 6, 8, 12, 13, which were analyzed using tabular form in
percentages. After that chi-square (x2) was also used to test the
hypothesis which were accepted the alternative hypothesis (Hi).
60
Showing that they are all problems facing new product
development which affects the growth of a firm.
5.3 RECOMMENDATION
Based on the findings of this study, the researcher recommended
the following suggestion to remedy the problems.
1. The company should developed their research and development
department so as to carry out adequate research to enable them
find what the consumers want and needs are in order to satisfy
them.
2. Good training programmed should be made available for the
marketing department or personnel of the Nigeria breweries plc.
For new production development which will expand the skill of
marketing personnel. It will also increase the quality of the
company’s produce.
3. The government policies should not be ignored or over looked to
avoid bund or sanction by the federal government.
4. To resolve the financial problems, government should set up a
financial institution that will be granting loans with low or little
interest rate to the company. This financial assistance will help go
a long way to improving the newly idea generation for the new
61
product development. This money should also be used for the
purpose it is made for.
5. The problem of poor timing of introduction of the products
management should know where, how, and when consumers
needs a new product and before every productions or introduction
should be made.
62
REFERENCE
Adeyemi, M.A. & Arowomola A.K (2004), “Compendium of Marketing

Terminologies
Anozie, .E.E. (2003), “Product-Mix and Brand Strategy” Owerri,

Imo State
Awa .H. Okorie(2005),“MARKETING Basic concept and Theory /

Decisions”, Igwurunta port-Harcourt. River State.
Benson .P. Shepipo, (1995) “Business Marketing Strategy” Cases,

Concepts and Applications, Boston skinner Printer Company
United State of America.
Chester Wasson (1980), “What is new about a new product” journal of

Marketing.
Marketing Journal (1991), “New product Development, Problem and

Prospect March Value 2
Philip Kotler (2003), “Marketing management Seventh Edition” Prentice

Hall Indian Branch.
Philip Kotler (1988), “Marketing Management 6 th Edition” analysis,

planning, implementation and control Prentice-Hall Indian Branch.
Pride .M. & Ferrell .O (1982), “Fundamental of Marketing Honghton

Mitten Co. Boston
Robert .D. Hisrictt (1978), “Marketing A New product London, The

Macmillan Press 2nd Edition.
Udell J.G (1981), “Marketing in an age or change” An introduction john

Willey and son, LNC. Canada.
63
APPENDIX 1
Marketing Department
School of Business
Federal Polytechnic Nasarawa
P.M.B
Nasarawa State
Dear Sir/Madam,
I am a final year student of the above named institution
and currently carrying out a research on the impact of new product
development on the growth of a Town (A case study of Nigeria Breweries
Aba, Abia State).
I will be very grateful, if you can provide adequate answer to the
questionnaires listed to enable me build up some information needed for
my research work.
All answer given should be treated with the most strict
confidentially.
Yours Faithfully,
AMADI GODWIN .C.
64
APPENDIX II
Please indicate you research on each item by inserting a tick (√) for the
dichotomous questions (that is questions requiring only Yes or No
answers).
i. Sex: Male Female and Above
ii. Age: 1 – 12, 21 – 30 31 – 40
iii. Qualification FSLC SSS SSCE
NCE OND HND and Above
iv. Years of experience with the company
1–2 2–3 3 and Above
v. MAIN QUESTIONNAIRE
1. Does your company carry out research always?
Yes No
2. If yes, how many years internal do they carry out research?
2 years 3 years 5 years
3. How much does your company budget for research?
Below N20, 000 above N20, 000
4. Does your company have research and development department?
Yes No
5. Does this department carry out research to new products?
Yes No
65
6. Is inadequate research a problem to new product development on the
growth of your company?
Yes No
7. If yes, is there any relationship between research department and new
product of development?
Yes No
8. Does government agent make move to inspect your products?
Yes No
9. Does the inspection help in the experience of the business?
Yes No
10. How often is the inspection?
Once a year twice a year thrice a year
11. Doe the government policies affect the growth of the company?
Yes No
12. How do you accept the company new product?
High Low
13. Do you acquire loan from bank and any other external means?
Yes No
14. What is the rate of the interest on the loan?
10% 20% 30%
66
15. In question “14” with interest rate of 30% and above, do you think
that acquiring external fund is a problem to the company?
Yes No
16. What is the cost of direct material in your production?
30% 40% 50%
17 How often do you have training programme per year?
Once twice none
18. Does inadequate training hinder the growth of you company?
Yes No
19Do you believe that training improve new product development on the
growth of the company?
Yes No
20. Is there any other competitor in the industry?
Yes No
21. Does new product development increase the sales volume of the
firm?
Yes No
22. Does it increase the market share?
Yes No
23. What is the duration of the company new product?
One year above one year
67
24. Does your company make use of break-even analysis and chart for
new product development?
Yes No
68

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THE IMPACT OF NEW PRODUCT DEVELOMENT ON THE GROWTH

(A CASE STUDY OF NIGERIA BREWERIES PLC ABA, ABIA STATE)

FPN/S01 /2007/2008/HMKT 545

A RESSEARCH PROJECT PRESENTED TO THE DEPARTIMENT OF

MARKETING SCHOOL OF BUSINESS AND STUDIES,

FEDERAL POLYTECHNIC NASSARAWA,

P. M. B. 001, NASARAWA, NASSARAWA STAE.

IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE

AWARD OF HIGHER NATIONAL DIPLOMA (HND) IN MARKETING

requirement for the award of Higher National Diploma (HND) in the

department of marketing, federal polytechnic Nasarawa, Nasarawa

MALLAM MUHAMMAD YERO DATE

MR J.T SOLOMON DATE

In award of higher National Diploma (H.N.D) in making.

MR J.T. SOLOMON DATE

MALLAM MUHAMMED YERO DATE

MR J.T. SOLOMON DATE

MR M.O. ODE DATE

This research work is dedicated to my Father which is in heaven. The

soon coming king.

The success of an organization lies on their ability to develop new

CHAPTER ONE: INTRODUCTION/BACKGROUND OF STUDY

1.1 Background of Study……………………………………………1

1.2 Statement of the Problem………………………………………5

1.3 Purpose and Objective of the Study…………………………..6

1.4 Research Questions……………………………………………7

1.5 Significance of the Study………………………………………7

1.6 Scope and Limitation of the Study…………………………….8

1.7 Research Hypothesis…………………………………………..9

1.8 Definition of Terms……………………………………………..10

2.0 Literature review…………………………………………………13

2.1 New product development……………………………………...13

2.2 Type of new product development………………………….....14

2.3 Product planning and product development…………………..15

2.4 Why new products are developed……………………………...17

2.5 Why new products fail or succeed……………………………...17

2.6 Organizational arrangement of handling

new product development………………………………………..19

2.7 From planning to commercialization……………………..……...22

2.8 The product development process………………………………26

2.9 The concept of product life cycle………………………………...28

2.10 The concept of innovation………………………………………...31

2.11 What brings about diffusion and adoption influences………….34

CHAPTER THREE: RESEARCH METHODOLOGY

3.0 Research Methodology…………………………………………..40

3.1 Sampling Unit / Frame……………………………………………40

3.2 Sampling Method…………………………………………………41

3.3 Determination of Sample Size…………………………………..41

3.4 Method of Date Collection………………………………………42

CHAPER FOUR: DATA PRESENTATION & ANALYSIS

4.0 Data Presentation and Analysis………………………………..43

4.1 Respondents Characteristics and Classifications…………….43

4.2 Data Analysis and Interpretation………………………………..43

4.3 Test of Hypothesis………………………………………………..52

4.4 Discussions of Findings………………………………………….60

CHAPTER FIVE: SUMMARY, CONCLUSION & RECOMMENDATION

1.0 INTRODUCTION / BACKGROUND OF THE STUDY

As human beings have always sought for growth and development

all through their lives span also an organizational product. A good,

service, idea that is perceived by same potential customers as new

are a new product. It may be through innovation, imitation or

renovation. In this piece of work, the researcher will concentrate on

the impact of new product development on the growth of a firm.