MKTG 222 Week 9

  • Created by: erised
  • Created on: 15-05-17 11:18

What is a new product?

  • Product Replacements - revision and improvements to existing products (e.g. Iphone 7) - Repositioning (same product but targeted to a new segment e.g. Old Spice products) - Cost Reductions (existing products reformulated so they cost less to produce
  • Additions to existing lines - To create greater product depth (e.g. hair shampoo for coloured, curly, blonde, straight hair)
  • New Product Lines - A move to a new market to widen the product line portfolio (e.g. if Pantene lanuches a body moisturiser line)
  • New-to-the-world products - Quite risky as its difficult to predict demand and consumers needs to learn how it works and how to consumer it. Innovation is very imporant (e.g Amazon Echo, hover boards)
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NPD Stages

  • Idea Generation
  • Screening
  • Concept Testing
  • Business Analysis
  • Product Development
  • Market Testing
  • Commercialisation. 

Innovation means the steps arn't so rigid but happen simultanously within the process of NPD.

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A process instititionalised by the company as well as being dependent on the actions of individuals. Rold of management is central in the innovation process.

  • Product/service
  • Process Innovation
  • Management innovation
  • Production innovation 

How to encourage innovation?

  • Establishing external links and collaberations with other firms
  • Internal managerial decisions to promote an innovation culture and to provide funds for R&D.
  • Use the customer
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The role of the customer

1. Customer as a resource - a source of innovation. Cons:

  • Lead to imitative, unimaginative products. Customers do not understand the techonolgy and/or the emerging markets. Definitely not for new-to-world products.
  • Customer contributions are limited by the tools used by marketers. Enquiry mechanisms limit the richness and frequency of feedbacks.
  • Can only use a select group of customers which might be unrepresentative of the customer popluation.
  • How do you select the customers? How to create an incentive to partcipate? How to process the information?
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The Role of the Customer

2. Customer as a co-creater. Customer participaton in product design and development. Enhances self-esteem, opportunities or customisation. Cons:

  • Increase the project uncertainty and time-frames
  • Need to integrate them in the internal NPD process
  • Support mechanisms need to be in place to enhance interaction/conversation
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The Role of the Customer

3. Customer as a user. Involvement in product testing and support. Cons:

  • Customer contributions can be limited by the high cost of providing facilities to structure and channel their inputs.
  • How to ensure the involvement of a diverse set of customers 
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