New product innovation ppt
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Transcript of New product innovation ppt
New Product Innovation
Agenda
Product Development Market Research Concept Testing Prototype Development Market Testing Product Launch Discussion
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
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
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%
New Products
A way of getting new and keeping old customers
Effective way of obtaining a competitive advantage
Source of growth and excitement
New Product Categories
New to the world products New product lines Product line extensions Improvements and revisions to existing
products Repositionings Cost reductions
Product Development Process
Market researchand
Opportunity scan
ConceptTesting
PrototypeDevelopment
TestMarketing
Product Launch
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
Marketing Strategies
Increase the number of customers Increase the average transaction Increase the frequency of repurchase
Marketing Concepts
Consumer orientation Customer service orientation Profit orientation Society
Marketing Mix
Product
Price
Promotion
Placement
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?
Market Opportunity and Threats
Economic Realities•GNP•Disposable Income•Discretionary Income
Legal & Regulatory Condition•Laws•Regulations
Societal Focus•Population Shifts•Values•Attitudes•Competition•Trends
Technological Development•Advance in technology•Market receptiveness to technology
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
Market Placement
Determine opportunity Segment size Annual usage potential Anticipated annual growth rate Margin Value in use
Evaluate competition Strengths/Limitations Implications
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
Concept Testing
Determine Critical success factors Financial objectives Marketing mix strategies
Product, Pricing, Promotion, Placement Marketing plan initiatives
Activity, Budget, Timing
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?
Promotion and Product Launch
Publicity Trade journals Conferences
Personal selling Word of mouth
Reasons For New Product Failures
Poor marketing research Technical problems Insufficient marketing effort Bad timing
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
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