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 Strategic implication of new product
development
2

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The process of new product development

± The process can be better understood by looking at

the following diagram.

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± Ôs the idea worth considering.

± Run informational sessions , where customers
meet with company engineers and designers.
± Make consumer brain storming sessions a
standard feature of plant tours.
± Like HP undertake programs like ³fly on the wall´
program in order to research with customers.

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± Use iterative rounds: A group of customers in

one room discussing on new product needs and a
group of technical experts in the other room.
± Set up an idea vault , and make it open and easily
accessible . Allow employees to review the ideas
and add constructively to them.
± Survey your customers and find out what they
like or dislike in your and competitors products.

:- Adapted from Robert Copper, Product

leadership, creating and launching superior
8/25/2010 new products.
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± Attribute listing
± Forced relationships
± Morphological analysis
± Reverse assumption analysis
± New contexts
± Mind mapping.

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± Ôs the product idea compatible with company

objectives , strategies and resources.
± This is basically done to avoid two types of errors :-
1) DROP error
2) GO error

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Lack of .10 .7 .07
competition
Marketing .20 .5 .10
support.
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± „efore moving to the net stage is concept development and testing company or
the product manager must test the over probability of product success.

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± Can we find a good concept that customers say that

they would buy??
± Till this step we have a product idea , but the
customer doesn¶t buy an idea they buy a concept.
± A product idea can be converted into several
concepts.

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± An idea can be converted into a concept by

answering the following questions:
1) who will use this product ?
2) what primary benefit should this
product provide ?
r) when will people use this product ?

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± Once a concept is ready the next step is to see how

would this product stand in relation with other
products of the same category.
± Perceptual maps is a way to see consumer
preferences and perceptions.
± Ôn order to see various brands available in the same
category, we need to have a look at the brand maps,
it shows how much to charge and what attributes to
highlight .

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± Refers to presenting the product concept

symbolically or physically to the target customers
and getting there reactions.
± This is done by developing prototypes of the
products either physically of through computers.

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± Communicability and believability .

± Need level.
± Gap level.
± Perceived value.
± Purchase intension.
± User targets, purchase occasion and purchasing
frequency.

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± Re measure consumer preferences for alternative

product concepts with conjoint analysis.
± Ôt is a method for deriving utility value that
costumers attach to varying levels of products
attributes.
± Respondents see various hypothetical offers attached
with various level of attributes and they are asked to
rank the offers.

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± Three package designs .(r)

± Three brand names .(r)
± Three prices .(r)
± An extra offering like one + one free.(yes/no)(2)
± A money back guarantee .(yes/no)(2)
± A researcher can form 108 possible product
concepts.(r r r 2 2)

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± Rill this product meet our profit goal ??
±
%$"($#'(!%(!%sum of estimated first
time sales , replacement sales , and repeat sales.
±
%$"($#'%this is done by R&D and
manufacturing department by preparing various
cost sheets.
±
%$"($#**$%total sales ± estimated
cost.
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± The job of translating costumer requirements into a

working prototypes.
± Desired costumer attributes are converted into
engineered attributes that can be used .
± Physical prototypes .
± Models of prototypes in the computer. eg „oeing .
± The product design and the brand image both are
highlighted in the prototype.

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 Test marketing
1Ë

± After the management is satisfied with the functional

and psychological performance, the product is ready
to be dressed up with brand name packaging and put
into market test.
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± Rhen to launch.(timing)
± Rhere to launch .(geographic strategy)
± For whom.(target market prospects)
± How (introductory market strategy)

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