NewProduct Development Objectives Understand how companies find and
New-Product Development
Objectives Understand how companies find and develop new-product ideas. Learn the steps in the new-product development process. 10 - 1
Product Development Types § New to World § New to firm § Line extensions § Improved products 10 - 2
New Product Development Strategy New products can be obtained via acquisition or development. New products suffer from high failure rates. Several reasons account for failure. 10 - 3
Figure 10 -1: Major Stages in New-Product Development 10 - 4
Product Development Process Stage Gate Philosophy: Involves the maintenance of control over the expenditures in new product development by balancing firm’s investment against the value of additional information 10 - 5
Parallel Development Based on a notion that some actions can begin before full information from other activities or tests is available. May begin to develop plans for commercialization during development stage. 10 - 6
Multidisciplinary Activity Cross functional team oversee the research & development , marketing research , production planning & financial analysis 10 - 7
New Product Development Strategy New Product Development Process: § Stage 1: Idea Generation v Internal idea sources: • R&D v External idea sources: • Customers, competitors, distributors, suppliers 10 - 8
Japanese Automaker Subaru Is Designing A Flying Motorcycle
Using the Web to Solicit Product Ideas Procter and Gamble To see how P&G solicits ideas from customers, visit the Procter and Gamble home page, click on the Resources and Offers button, then select the Share Your Thoughts listing. Procter & Gamble 10 - 10
New Product Development Strategy New Product Development Process: § Stage 2: Idea Screening Potential demand v Chances of success. v. Estimate degree of cannibalization v 10 - 11
New Product Development Strategy New Product Development Process: § Stage 3: Concept Development and Testing Product concepts provide detailed versions of new product ideas. v Consumers evaluate ideas in concept tests. v 10 - 12
New Product Development Strategy New Product Development Process: § Stage 4: Marketing Strategy Development v Strategy statements describe: • The target market, product positioning, • Product price, distribution, and marketing budget for the first year. 10 - 13
New Product Development Strategy New Product Development Process: § Stage 5: Business Analysis v Sales, cost, and profit projections § Stage 6: Product Development v Prototype development and testing 10 - 14
Daimler is currently road-testing its prototype NECAR 5 (New Electric Car) 10 - 15
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Business. Now Sensable Video Clip Computer modeling is being used to aid in product design 10 - 17
New Product Development Strategy New Product Development Process: § Stage 7: Test Marketing Standard test markets v Controlled test markets v Simulated test markets v § Stage 8: Commercialization 10 - 18
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