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MEANING
According to Arch Paton, A new product is a product that opens up an entirely new market, replaces an insisting product or significantly, broadens the market for an existing products.
MEANING:10%New to the world 20%New Product Lines 26%addition to existing product Lines 26% improvements 11%Repositioning
30%New to org.
New Product Line cost New repositionin greduction Product Line 7% 20% 11% New to the world product 10% modification Addtion to 26% existing product lines 26% New to the world Addtion to existing product lines product modification repositioning cost reduction
BOOZ & ALLEN has identified six categories of new products: New to the world New product lines Addition to existing product lines Improvements & revisions of existing products Repositioning Cost reductions
New product development process:Idea generation.(is the idea worth considering?) Screening of New Ideas Product Concept Development & Testing Business analysis Product Development Test Marketing Commercialization
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Idea Generation
The new product planning process starts with generation of ideas. New product ideas usually generate with the reorganization of consumer needs. An alert market can get some ideas from the customers for possible new products to perceive those needs, which are so far unexpressed.
Internal Sources
Research and Development Deptt. Manufacturing People Sales People Top Management
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External Sources
Secondary Sources Customers Competitors Resellers Foreign Markets Investors Animation Films
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Area of performance
To measure the consumer targets & purchase frequency To measure the gap level between the new product & existing products in the market. To measure the perceived values.
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Business Analysis
Business analysis may be defined as an evaluation of product idea in depth with a view to demand analysis, cost analysis & profitability analysis. the management mainly performs the following acts:Identifying the product characteristics Production capability Production facilities Estimating cost of production Estimating profits & sales Programme for new product development
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Product development
During business analysis,if the product is found to be economically feasible, it enters the next stage if product development where the new product idea is converted into a product. The product development includes the following steps: Engineering Research Developing Models Consumers Preference Testing Developing Marketing Mix
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Test Marketing
Test marketing provides important clues about the product,product weakness &deficiencies and also provides an opportunity to understand the working & relative importance of the product components of the marketing mix
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Commercialization
If the product is found to be suitable as a result of analysis & study of the result of test marketing with or without the modification, it is ready to be launched in the market.
After test marketing, if sales is satisfactory to be excellent then the company will go to launch the product.
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