New Food Products (A)

STM3107 Product
Development
Introduction
-The New Food Product-
Jabatan Sains Makanan(2014)

(2012)
NOTE: These lecture notes are provided SOLELY for individual study purposes for students currently enrolled in the subject STM3107 Product
Development, offered by the DEPARTMENT OF FOOD SCIENCE, FACULTY OF AGROTECHNOLOGY AND FOOD SCIENCE, UNIVERSITI MALAYSIA
What are food products?

(2012)
Food products
What are food products?
In general, food: a material consumed by humans to satisfy
physiological and psychological needs
For the food company: a basic functional product to which it
has added packaging, aesthetics, brand, price and
advertising, to give a total company product.
For the consumer: a bundle of benefits, relating its tangible
and intangible attributes to their needs, wants and behaviors.
3 groups of food products in the food system:

Primary products from sea and the land
Industrial ingredients from food processors
Consumer products from food manufactures and foodservice
outlets
(2012)
Every product has a life

cycle
http://wwwrohan.sdsu.edu/~renglish/370/notes/chapt11/index.htm
(2012)
Product life cycle

Phases of life cycle of a product:
Introduction stage
Heavy promotion, in-store demonstrations, and advertising to
gain introduction
Sales volume is initially low (customers and consumers are started
to be aware of the product)
Growth stage
1. A strong growth period
First-time consumers begin repeated buying

New consumers are attracted
Positive acceleration of sales growth
Growth continues as new market open
Continued promotion and expansion are costly (if maintained at the same
pace as in the introductory stage)
2. A decline in the growth
Growth accelerates negatively

(2012)
Product life cycle

Phases of life cycle of a product (contd):
Maturity stage
A no-growth period
Sales are constant
A sign of a stagnating market
Declining stage
A decline in sales volume begins
Newly introduced competitive products adversely
affects sales
Costumers and consumers become indifferent to the
old product
Promotions are too costly to maintain sales volume
(2012)
Product life cycle

To prevent slipping into decline,
promote more frequent use of the product by
current customers
find new target markets for the product
find new uses for the product
price the product below the market
develop new distribution channels
add new ingredients
delete old ingredients
make a dramatic new guarantee, etc.
(2012)
Why new products are developed?

The need for new food product development is driven by five
dominant forces:
All products have LIFE CYCLES. They eventually die and must be replaced or
reinvigorated by heavy marketing or see consumer rejuvenation if the brand
or the manufacturer wants to survive.
New products offer the opportunity for aggressive growth to satisfy
management long-range business goals
New markets may be created, e.g. organic or functional foods markets, and
companies are tempted to enter with their products. Marketplaces may
change, e.g. e-commerce, requiring new products more suited to respond to
the changes
New knowledge and advancing technologies make technically feasible food
product ideas that were once considered impossible. E.g.: new knowledge in
the health sciences suggest opportunities for new food products suited to the
healthy lifestyle of todays consumers.
Changes in government legislation, health programs, agricultural policy, or
agricultural support programs could require the development of new food
products.
(2012)
Corporate reasons for NPD

Food companies can achieve growth through some ways, such as:
Expanding into new geographic markets
Can be expensive and risky if the expansion is into a territory where a competitor has a
strong foothold
For products with short shelf lives, distribution system and its cost may limit the
expansion needs R&D to increase shelf life
Export markets have their own unique hazards, including the need to accommodate local
taste preferences
Achieving greater market penetration with a greater market share in existing

markets
Large budget is required for advertising and promotion, esp. if the market is dominated by
the competitor
Developing new products

To open new markets that can contribute to growth and profit
The umbrella of brands expands. New products must be developed to bring in new profits.
Cost of development and marketing to be considered
Acquiring rivals or smaller companies with similar or complementary products in

widely separated regions of the country
To expand the brands into new markets and use those of its acquired company
(2012)

(2012)
Marketplace (society) reasons for

NPD
Many factors cause a changing pattern of buying habits, such as:
Major long-term living patterns
Urbanization, suburban and in-city living, multicultural community
Working patterns
Increase in office workers and decrease in blue collar workers
Gender roles
Women working, women in former male-dominated positions, women in senior
positions
Economic status
Increasing incomes, more equal distribution or more unequal distribution of
incomes
Educational status
Knowledge growth from education and the media
Age structure
Increasing percentage of old people and of young people
Dynamic population
We travel abroad more frequently and so are exposed to many new types of food.
(2012)

(2012)
Technological & knowledge pressure

forcing NPD
Technology has changed the market in many ways, such
as:
Costumers and consumers are more concerned about their health
and the role of food and nutrition in their health and in the
prevention of disease.
A growing number of more discriminating shoppers aided by
nutrition labeling, the internet, etc.
Social scientist have developed better techniques to research
and understand costumer and consumer behavior and emotions.
Food manufacturers are becoming adept at successfully developing new
products based on these concepts
Retailers are using their knowledge of buyers behaviors to

attract customers (e.g. the use of food odors, in-store tasting,
delis, and entertainment) and to serve their needs (advice on
foods) to the retailers advantage
(2012)

(2012)
Government influences pushing

NPD
The objectives of government to have food
legislation are:
To ensure the food supply is safe and free from
contamination within the limits of available knowledge and
available at a cost affordable by the costumer
To develop standards of composition for foods and labeling
standards in cooperation with food manufacturers,
responsible consumer groups, and other interested groups,
in order to provide adequate information to customers so
they can make intelligent choices in purchasing food
To maintain fair trading practices and competition among
retailers and manufacturers in such a way that benefits
customers
(2012)

(2012)
Defining new products

A new food product: one that is NEW
The product has not been presented in the local
marketplace, OR in any marketplace (rare).
Most products advertised as new usually have an
analogue, a comparable look-alike, produced locally by a
competitor, produced elsewhere in the country, or imported.
Simplest definition:
a product not previously manufactured by a company and
introduced by that company into its marketplace or the
presentation by a company of an established product
perhaps in a new form or into a new market not previously
explored by that company
(Fuller, 2005).
(2012)

General characteristics of classes of new food products (Fuller, 2005):
Line extensions
Little time or research is required, no major manufacturing changes, relatively little
change in marketing strategy, no new raw material sources are required, can use regular
distribution system
E.g. a new flavor for a line of flavored bottled waters, new varieties of a family of canned
ready-to-serve soups, new flavors for a snack product, a coarser peanut butter
Repositioned-existing products
R & D time is minimal, manufacturing is unaffected, new strategies for marketing,
promotion and sales tactics
E.g. oatmeal-containing products positioned as dietary factors in reducing cholesterol,
soy-containing products repositioned as dietary factors in combating cancer; soft drinks
positioned as main meal accompaniments
Repackaging of existing product

The novelty of the packaging dictates the R&D required, slight impact on physical
facilities, requires new packaging equipment, little impact on marketing, sales and
distribution
E.g. single serving sizes, squeeze bottles for condiment sauce

(2012)

General characteristics of classes of new food products (Fuller,
2005) (contd):
Reformulation of existing products
Moderate R&D, generally little impact on physical facilities, marketing and sales
resources unless it leads to repositioning of product
E.g. low-calorie/reduced sugar/reduced fat products,
hotter/spicier/crunchier/smoother products, lactose-free milk products, high-fiber
products, greener products
Innovative products
Amount of R&D depends on the nature of the innovation, highly variable impact on
manufacturing capabilities, possible heavy impact on marketing and sales resources
E.g. frozen dinners, simulated seafood products
Creative products
Generally heavy need for extensive R&D, costly, timely, may require new plant &
equipment, require total revision of marketing and sales forces, may require creation
of new company or brand, high risk of failure
E.g.: everything that is considered new at a specific time, for example extruded
products, surimi- and kamaboko-based products were new in early 2000s

(2012)

(2012)
Defining a new products

Cooper (1993) and Crawford (1994) categorizes new products as follows:
New to the world
Produced by the company for the first time with no existing substitutes produced by
competitors in the marketplace
Real innovations
New product lines (me-too products)

The product is new to the company but not to the marketplace
Product line extensions (additions to existing product lines)

A firm can produce a product which is fairly new to the marketplace
Product improvements (revisions to existing products)

Aimed at improving the existing product and also giving better value to the customer than the
existing product
Product repositioned (retargeting)

Occurs when firms enter a new market segment with the old product, or products are targeted
for a new use or application
Product cost reduction

Repositioned as a cheaper product
Allows a firm to reduce the cost of the product, but still provide the same benefits that the old,
existing product has provided to the customer

(2012)

(2012)
New products & innovation
Innovation chain in a
company

(2012)
NPD process
4 main stages in the product development process (Earle, Earle and Anderson,
2001):
Stage 1: product strategy development
Sub-stages:
Defining the project
Developing the product concept
Product design specification
Stage 2: product design and process development

Stages: product mock-ups; elementary product prototypes; acceptable product prototypes; optimum
product prototypes; final product prototype
Important factors: raw materials and ingredients; aesthetic skills in product design; values of the product
characteristics; ergonomics; semi-production plant facilities; internal and external capabilities; review and
control of design process
Stage 3: product commercialization

Four important stages:
Setting up the commercialization

Design of marketing, production and distribution
Testing of marketing, production and distribution
Final integration of marketing, production and finance
Stage 4: product launch and evaluation

Three important parts:
Launch strategy
Launch activities
Demand outcomes
(2012)
New product failure

Lots of food products get to
market, obtain early distribution,
and fail to sustain it. Soon,
distribution is waning, and the
product is being swapped out for
another new item.
Product failure:
Absolute failure: occurs if a company
incurs a financial loss
Relative failure: occurs if a company
makes a profit but does not attain
profits of image objectives
4 main reasons for new product

failure (Crawford et al., 2006):
1. Poor planning
2. Poor management
3. Poor concept
4. Poor execution
(2012)
Criteria for a a successful new

product
New product will be successful if several criteria are met:
It has to give profit return to the investment that the company has
made
Consumer interest can be predicted and statistics can be calculated from the
size of the market, R & D, market testing, cost of production and advertising
used to analyze and estimate profit return can prevent a costly failure
later
It has to be relevant to consumer needs and priorities

Can be obtained through research/study, analysis of retail store sales,
information from sales personnel who come in direct contact with consumers
It has to possess desirable quality unique to it in some way.

If that quality is inimitable as well as desirable, then it has more potential
It is not realistic to think that a product will not be duplicated or improved.
Thus, the product should possess some technological innovation so that it
will take time for competitors to unravel it It will give time to the origin
product to strengthen its position in the market.

(2012)
References
Brody, A. L. and Lord, J. B. (eds). (2008).
Developing new food products for a changing
marketplace. Boca Raton, Fla.: CRC Press.
Earle, M., Earle, R. and Anderson, A. (2001). Food
product development. Cambridge, England:
Woodhead Pub.
Fuller, G.W. (2005). New food product
development : from concept to marketplace. Boca
Raton, Fla.: CRC Press.

(2012)

New Food Products (A)

Transféré par

Informations du document

Titre original

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

New Food Products (A)

Transféré par

Droits d'auteur :

Formats disponibles

STM3107 Product

Jabatan Sains Makanan(2014)

What are food products?

Jabatan Sains Makanan(2014)

3 groups of food products in the food system:

Every product has a life

Product life cycle

First-time consumers begin repeated buying

2. A decline in the growth

Growth accelerates negatively

Jabatan Sains Makanan(2014)

Product life cycle

Product life cycle

Why new products are developed?

Corporate reasons for NPD

Achieving greater market penetration with a greater market share in existing

Developing new products

Acquiring rivals or smaller companies with similar or complementary products in

Jabatan Sains Makanan(2014)

Marketplace (society) reasons for

Jabatan Sains Makanan(2014)

Technological & knowledge pressure

Retailers are using their knowledge of buyers behaviors to

Jabatan Sains Makanan(2014)

Government influences pushing

Jabatan Sains Makanan(2014)

Defining new products

Defining new products

Repackaging of existing product

Jabatan Sains Makanan(2014)

Defining new products

Jabatan Sains Makanan(2014)

Jabatan Sains Makanan(2014)

Defining a new products

New product lines (me-too products)

Product line extensions (additions to existing product lines)

Product improvements (revisions to existing products)

Product repositioned (retargeting)

Product cost reduction

Jabatan Sains Makanan(2014)

Jabatan Sains Makanan(2014)

New products & innovation

Jabatan Sains Makanan(2014)

Stage 2: product design and process development

Stage 3: product commercialization

Setting up the commercialization

Stage 4: product launch and evaluation

New product failure

4 main reasons for new product

Criteria for a a successful new

It has to be relevant to consumer needs and priorities

It has to possess desirable quality unique to it in some way.

Jabatan Sains Makanan(2014)

Jabatan Sains Makanan(2014)

Vous aimerez peut-être aussi