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What is the New Product Development process?
- Idea generation
- idea screening
- business analysis
- test marketing
Who contributes in the idea generation process?
What is idea screening?
goal is to reduce number of ideas. Find which ideas do consumers like and fit our company
What is concept test?
consumers reactions to descriptions of product idea.
What questions are asked during the business analysis?
- Will it be profitable to make and sell the product?
- What is total size of market?
- Whats the likely market share?
- Whats the manufacturing costs and unit contribution?
- How much do we need to spend on marketing launch?
What is done in development?
- develop packaging and labeling,
- plan how to advertising, pricing, what channels to use.
What is done in test marketing?
- a "real world" test of a product and marketing program in a limited market.
- can evaluate various marketing strategies
- takes time
- product can be exposed to competitors
what is the Commercialization stage?
- We ask when and where.
- When: what do we think competitors are doing, and how will launch affect our other product
- Where: start regionally or global rollout
What does the Diffusion of innovations model tell us?
How quickly will it spread through the market?
What does the product life cycle model tel us?
How should marketing mix be adapted over the course of the life of the product?
How do innovations spread?
- -Innovation: product perceived as new by potential adopters
- -Diffusion process
- -Fiver categories of adopters
What is the diffusion process?
the process by which an increasing number of people adopt the product.
What are the five categories of adopters?
- early adopters
- early majority
- late majority
What affects rate of adoption?
- Complexity: more complex=slower diffusion
- compatibility: fit with current values and experiences of target market. how does it fit in our lives
- relative advantage: how much better is it than current options.
- Observability: are benefits of product easily observed? ex iphone is
- Trailabilty: how easy is it to try new product? Ipad low, food high
What is PLC?
- Product Life Cycle, a diagnostic tool that helps marketers anticipate future changes in the market.
- DOES NOT TELL MANGERS WHEN THE PRODUCT WILL GO THROUGH EACH STAGE
What are the PLC Stages?