New Products: Life Cycle, Adoption and Diffusion Essay example

Submitted By Abbyus1115
Words: 582
Pages: 3

Ch 7 New Products

Factors associated w/ new prdct success
1. prdct superiority & high quality.
2. Eco adv to user.
3. Overall company & proj fit.
4. Identified mkt need, growth & size.
5. Competitive opportunity or niche.
6. Excell in CS.

New prdct development process
1. Idea generation.
Most ideas do not become prdcts.
Idea generation, the least expensive step in new prdct development, requires recognizing available idea sources.
New prdct development must focus on meeting C’s needs.
Top mngmnt support is critical.
2. Idea screening. (Usually it’s a group effort)
Ppl who in charge of the idea screening should be very experienced, and should find the balance btw type 1 error (never kill a good idea) and type 2 error (never let a bad idea go by)
Risk categories:
1. Strategic risk: does the prdct meet the genuine need.
2. Mkt risk: the risk that a new prdct won’t meet a mkt need in a value-added, differentiated way.
3. Internal risk: the risk that a new prdct won’t be developed w/I the desired time & budget.
Firms should not hastily in discounting new prdct ideas because of a lack of resources or expertise. Instead, they should consider forming joint or strategic alliances with other firms.
Ideas that appear to hv adequate profit potential and offer the firm a competitive adv in the mkt should be accepted for further study.
3. Proj planning (Biz analysis)
Analyze the proposal in terms of production, MKT, financial & competitive factors.
Establish a development budget w/ preliminary MKT & tech research.
Create a “rough form” prdct.
Create a proj plan w/ estimated costs.
Review the proj plan w/ top mngmnt.
4. Prdct development.
Evaluate the prdct from the viewpoint of engineering, manufacturing, finance & MKT.
Consider further research & testing.
Produce a finished prdct & “ mkt test it” (diff from test MKT)
A development, report to mngmnt is prepared.
5. Test MKT.
Goal is to evaluate & adjust if necessary the marketing strategy to be used in the MKT mix.
4P’s MKT mix.
6. Commercialization.
The firm commits to introducing the prdct into the marketplace.
Emphasis is placed on org. structure & mngmnt talent needed to implement the MKT strategy.
Prdct Life Cycle