New Product and its development process
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The document outlines the new product development process, which includes idea generation, idea screening, concept development and testing, business analysis, market and beta testing, technical implementation, commercialization, and pricing. It discusses each stage in the process, from coming up with initial ideas through testing prototypes, analyzing market potential, launching the product commercially, and determining price. The goal of the new product development process is to systematically transform a market opportunity into a new product available for sale.
New Product and its development process
- 1. NEW PRODUCT & Development Process Presentation By: Eliya Shrestha 12248
- 3. Concept of Product an article or substance that is manufactured or refined for sale. a thing or person that is the result of an action or process.
- 4. New Product: New product is the complete process of bringing a new product to the market till its consumption and feedback from the end user of the business chain through the systematic procedure and parameter. It may be a Consumable product, service or idea.
- 5. Different meaning of New products from different perspective. Firms perspective: it is a product to be new if the firm is manufacturing it for the first time. Firms often consider copies of a competitor’s product as new. Market Perspective: From the view point of a market, if the product has been introduced to the market for the first time, it is a new product. Customer perspective: it suggests that newness of a product should be based on customers perception. If a customer group feels that a product is new, it should be treated as new. Product perspective: From the product perspective a new product is viewed on its disruptive effects on the current consumption pattern.
- 6. Innovations It is original products that are introduced to the human race for the first time. Many innovative products are being introduced into the market every day. Innovative products entail high costs and risks. Innovation involves considerable time as well as money
- 7. Modification Many organization avoid innovation due to high cost and risk factors. And adopt new products modification strategy as long as possible. Modified product can be termed as a new product as it requires major change in the marketing mixes.
- 8. Product modification entails 1. Quality Modification: it is changes relating to a product’s dependability and durability. It involves alteration of the materials and production process used. 2. Functional modifications: are changes in the product’s effectiveness, convenience and safety. It involves redesigning the product. 3. Style modification: is targeted at enhancement of the sensory appeal of the product by altering sound, taste, texture, smell or visual characteristics.
- 9. New Product Development It is the complete process of bringing a new product to market. New product development is described in the literature as the transformation of a market opportunity into a product available for sale. it can be tangible (that is, something physical you can touch) or intangible (like a service, experience, or belief). A good understanding of customer needs and wants, the competitive environment and the nature of the market represent the top required factors for the success of a new product.
- 10. New product development process Ideation screening Concept Developme nt & Testing Business Analysis Market & Beta Testing Technical Implementati on Commerciali zation Product pricing
- 11. Idea Generation Ideas for new products can be obtained from basic research using a SWOT analysis (Strengths, Weaknesses, Opportunities & Threats). Lots of ideas are generated about the new product. Out of these ideas many are implemented. The ideas are generated in many forms. Many reasons are responsible for generation of an idea. Idea Generation or Brainstorming of new product, service, or store concepts - idea generation techniques can begin when you have done your OPPORTUNITY ANALYSIS to support your ideas in the Idea Screening Phase
- 12. Idea Screening It involves a preliminary elimination process in which a large number of product ideas are screened in terms of the organization’s objectives, policies, technical feasibility, and financial viability Total ideas are categories into three group. They are, promising ideas, marginal ideas and rejected ideas.
- 13. Development and Testing It is based on the notion that the product idea is the most critical element in a product and consumers can easily react to product concepts without seeing the physical product itself. The concept tests are conducted on the belief that people usually are attracted by the idea behind the product before they become interested in the physical product.
- 14. Business Analysis Estimate likely selling price based upon competition and customer feedback Estimate sales volume based upon size of market. Estimate profitability and break-even point.
- 15. Beta Testing and Market Testing Produce a physical prototype or mock-up. Test the product (and its packaging) in typical usage situations. Conduct focus group customer interviews or introduce at trade show Make adjustments where necessary. Produce an initial run of the product and sell it in a test market area to determine customer acceptance
- 16. Technical Implementation New program initiation Finalize Quality management system Resource estimation, Requirement publication Publish technical communications such as data sheets Program review and monitoring Resource plan publication
- 17. Commercialization Launch the product Produce and place advertisements and other promotions. Fill the distribution pipeline with product. Critical path analysis is most useful at this stage.
- 18. New Product Pricing[ Impact of new product on the entire product portfolio Value Analysis (internal & external) Competition and alternative competitive technologies Differing value segments (price, value and need) Product Costs (fixed & variable) Forecast of unit volumes, revenue, and profit
- 19. THANK YOU
- 20. The promising ideas are carried on for further testing and analysis while marginal ideas are stored for future use. The rejected ideas are dropped altogether.