2. Agenda
Product Development
Market Research
Concept Testing
Prototype Development
Market Testing
Product Launch
Discussion
3. Why New Products?
New product development is critical to long-
term success
Approximately one-third of the revenue a
business generates is coming from products
they did not sell five years ago
Changing environment creates new demands
and needs
4. Product Development
Must be alert to quickly develop opportunities
Focus on markets or product categories
consistent with organization’s objectives,
resources, capabilities and strengths
Securing a competitive advantage
5. Industrial New Product Ideas
Company sources other than R&D 36.2%
Analysis of the competition 27.0%
Research & Development 24.3%
Product users 15.8%
Supplier suggestions 12.5%
Product user research 10.5%
Published information 7.9%
6. New Products
A way of getting new and keeping old
customers
Effective way of obtaining a competitive
advantage
Source of growth and excitement
7. New Product Categories
New to the world products
New product lines
Product line extensions
Improvements and revisions to existing
products
Repositionings
Cost reductions
8. Product Development Process
Product
Launch
Test
Marketing
Prototype
Development
Concept
Testing
Market research
and
Opportunity scan
9. Marketing
Very important to product development success
Key to successful marketing is imaginative,
effective, creative communication
Find a need and fill it.
Mutually beneficial exchange relationships
Non-profit organizations have sometimes difficult
task
10. Marketing Strategies
Increase the number of customers
Increase the average transaction
Increase the frequency of repurchase
11. Marketing Concepts
Consumer orientation
Customer service orientation
Profit orientation
Society
13. Market Research
Who is my target audience?
Are there enough members of this target group to
make the business worthwhile?
How large is the potential market and how much of
that potential market can I capture?
Who is my competition and what would make
someone choose my product over their current?
14. Market Opportunity and Threats
Societal Focus Economic Realities
•GNP
•Population Shifts
•Disposable Income
•Values
•Discretionary Income
•Attitudes
•Competition
•Trends
Technological
Development
•Advance in Legal & Regulatory
technology Condition
•Market receptiveness •Laws
to technology •Regulations
15. Market Placement
Identify target markets
Size and growth potential
Ability and ease of reaching segment
Good fit with organizational objectives
Greatest revenue generation with least investment
16. Market Placement
Determine opportunity
Segment size
Annual usage potential
Anticipated annual growth rate
Margin
Value in use
Evaluate competition
Strengths/Limitations
Implications
17. Market Research – Pricing Strategies
Goal is to achieve a target profit
Can you hold a product’s manufacturing costs
down to less than 25% of its perceived value?
Estimating manufacturing costs
Obtain price quotes from several suppliers
19. Prototype and Test Marketing
Survey end-users
Do you prefer this product over your current
product?
Does this product meet the need you thought it
would?
Does the way the product works provide an
important benefit?
20. Promotion and Product Launch
Publicity
Trade journals
Conferences
Personal selling
Word of mouth
21. Reasons For New Product Failures
Poor marketing research
Technical problems
Insufficient marketing effort
Bad timing
22. Marketing Plan
Audit
Challenge and refine assumptions from current
plan
Evaluate success for input into next year’s plan
Revise plan for new year incorporating
marketplace learnings, marketing insights and
current plan successes
23. Summary
New product development drives growth
Market research is critical to the success of a
new product launch
Market research is a continuous process as
customer needs, your business and the
environment changes