New Product Development (NPD) is the total process that takes a service or a product from conception to

market. New or rebranded products and services are meant to fill a consumer demand or an opportunity
in the marketplace. In New Product Development Process there are 8 steps in able for it to be successful.

Idea Generation
Idea generation is the first step of New Product Development process. It is a systematic search to find out
new ideas. It comes from everywhere and in any form. In the first stage, new ideas are collected from
many sources, which are:
Internal Sources- Mostly, large companies have their own formal Research and Development department.
But normally any employee can come up with a good idea.
Customers - A company should always listen to customers’ questions, complaints and feedbacks that help
to generate new product ideas to satisfy customer problems.
Competitors - To generate ideas companies can conduct competitors swot analysis.
Distributors and suppliers - Also known as collaborators are close to the market. They know the consumer
problems and new ideas and techniques to address these problems.

Idea Screening
Idea generation can provide us with a pool of ideas. But the second step of new product development
process is to find good ideas and drop the poor one.

Concept Development and Testing

Concept development and testing is the third step of new product development process. A product
concept provides a detailed description of the idea, keep in mind your consumer perspective.
Those ideas qualify the screening stage to become a concept and it must be tested. Companies cannot
launch a new product without properly testing the concept. Concept testing help companies to investigate
customers reactions before introducing to the market.

A more physical and visual presentation is required for a more reliable concept test. The concept further
engages target market. After exposing the concept, companies ask questions from consumers. Companies
want to know the customer’s reactions in term of feedback. Is the concept appealing or not and fulfilling
the customers wants?

Marketing Strategy and Business Analysis

In this step, the company develops marketing and business strategy to introduce a new product in the
market successfully. The company engages different business units – to perform marketing and financial
analysis – to meet the marketing objectives.

The company initially explain target market and product positioning. It should also explain sales forecast,
market share and profit both in short and long-run. The company also describes the marketing mix
strategy.

Business analysis involves a detailed review of company cost, sales, profit projections whether the
company is satisfied with objectives.

Product Development
When all the marketing and business strategies are finalized. In this step, the product concept is
transformed into a physical product. In the development stage, a prototype is designed that is functional
and able to satisfy the consumer wants. The product undergoes serious tests to make sure its
effectiveness and performance.

Test Marketing
After designing a successful prototype, it is introduced for further research and feedback. With the help
of test marketing, the company tries to understand the consumers and dealers feedback and reaction.
Important changes are made in the actual product if needed. This step completes the process empowers
the company to successfully introduce the new product in the market.

Commercialization
Test marketing helps the company to make decisions and launch the new product in the market.
Commercialization is introducing the new product in the target market. The marketing mix strategies are
applied. Four decisions are important when launching a new product.

When to introduce the product.

Where to launch a new product in single or multiple location, national or international market.
To whom the company must decide distribution and promotion (already decided in test marketing phase).
How (action plan) a company should introduce the new product in the target market.

Introduction
A detailed introduction plan is required for a positive impact of the new product in the market. This is also
known as the first stage of Product Life Cycle.

https://www.marketingtutor.net/new-product-development-steps/

2. Product Strategies

No one best product strategy applies to all small companies. A company's product strategy is often
contingent upon its key objectives, the competition and the length of time the product has been on the
market. Some product strategies are more permanent. For example, a small company may be a value
leader and keep its product prices relatively low. However, the best product strategies for a small
company are often those that fit the current situation.

Product Concept
The best product strategies usually start with a product concept, which is a general idea about a particular
product. Various departments within a company may meet and talk about a new product idea that may
complement a company's current product line. During this process, decision makers will often create an
outline for the product, including features, dimensions and even a price range. Marketing research
managers may even have industry research information that shows the strengths of key competitors and
their products.

Marketing Research
A new product strategy will ultimately need to be tested through focus groups, phone surveys and beta
tests. Focus groups are sessions where company managers observe consumers through a one-way mirror.
A moderator or interviewer will ask the consumers questions related to the company's product concept,
including their likes, dislikes and suggestions for the product. This information is usually evaluated later
to help tweak the product concept.

After focus groups, companies use phone surveys to obtain a more reliable sample about the market's
reaction to the product. The larger volume of surveys better represents the general population's feelings
about the product. If phone research is favorable, the next step in getting the product to the market is a
beta test. A beta test is when a small company fully distributes and advertises the product in several
markets. After that, the company will usually roll the product out regionally or even nationally.

Pricing Product
A company that is the first to enter a new market may use a price skimming strategy, pricing its product
exceptionally high. Price skimming is primarily used to quickly recoup the high production costs associated
with new products. The best time to use price skimming is when the demand for a product is inelastic,
according to the article "Price Strategy" at NetMBA, an online business reference site. An inelastic demand
means that customers are not price sensitive. For example, a consumers may not care about the price of
new cell phone technology.

A small company can also use penetration pricing for its products, charging low prices to quickly build up
their customer base. Once a company has acquired a customer, it can send them regular promotions to
retain them, which can help build brand loyalty.

Product Positioning
Product positioning is a "best practice" strategy used for both new and existing products. Small companies
typically use a grid when developing a product positioning matrix. The objective of product positioning is
to determine which segment of the market to place a product. Companies often use two important
product variables in a product positioning matrix. For hot cereal, these variables may include "price" and
"time to cook." The product price can be low or high, and the time to cook the cereal can be slow or quick.
Consequently, segments for hot cereal may be low price/quick to cook, low price/slow to cook, high
price/quick to cook or high price/slow to cook.

A small company will usually plot its existing products as well as competitive products within the various
segments. The segment with the least amount of plotting points may indicate an opportunity for the
company, as that particular segment is under-served.

Product Life Cycle Management

All best product strategies include managing a product through various stages of the product life cycle. A
product has four stages: Introduction, growth, maturity and decline, according to QuickMBA website.
Successful products usually sell well in the introduction and growth stages. The challenge comes when
competition enters the market during the maturity stage. At this point, a company may need to
differentiate its product with new features or lower prices to increase sales and profits. The key to product
life cycle management is getting as much mileage out of a product as possible, before new technology
takes over.

https://smallbusiness.chron.com/product-strategies-5062.html