NEW MARKET OFFERINGSNEW MARKET OFFERINGS

SANA ZAHID

NAVEEN ZUBERI

EXECUTIVE SUMMARYEXECUTIVE SUMMARYIIn the present era of fast changing market dynamics in n the present era of fast changing market dynamics in marketing, where everyone is trying its level best to marketing, where everyone is trying its level best to capture either the existing market or creating new markets capture either the existing market or creating new markets through their innovative products. through their innovative products. Due to technological revolution the world has practically Due to technological revolution the world has practically turned into Global village. Multinationals have been able to turned into Global village. Multinationals have been able to develop products according to local needs. Due to credible develop products according to local needs. Due to credible market research and customer needs they have been able market research and customer needs they have been able to create new markets. Within existing markets due to new to create new markets. Within existing markets due to new innovative approach they have increased the market base innovative approach they have increased the market base and also maintained their leadership position.and also maintained their leadership position.Local industry has also been able to penetrate better to get Local industry has also been able to penetrate better to get share from multinationals with quality products reinforced share from multinationals with quality products reinforced with better strategies and cost effectiveness.with better strategies and cost effectiveness.

CHALLENGES IN NEW PRODUCTS CHALLENGES IN NEW PRODUCTS DEVELOPMENTDEVELOPMENT

New products failure

1. Poor marketing Plan

2. Marketing plan implementation

CLASSIC EXAMPLES OF NEW CLASSIC EXAMPLES OF NEW MARKET OFFERINGSMARKET OFFERINGS

VIDEO / AUDIO IPODS CELLULAR TELEPHONES I MATS ATM CARDS FROM FOREIGN BANKS SKIN / HAIR CARE PRODUCTS MULTI FUNCTIONALS COMPUTERS /

PRINTERS

HINDERANCE FACTORS IN NEW HINDERANCE FACTORS IN NEW PRODUCTS DEVELOPMENTPRODUCTS DEVELOPMENT

Shortage of ideas in FMCG Higher R & D cost Shorter product life cycle

ORGANIZATIONAL ORGANIZATIONAL ARRANGEMENTSARRANGEMENTS

Budgeting for new products development Organizing new products development

NEW PRODUCT NEW PRODUCT DEVELOPMENT DEVELOPMENT

DECISION PROCESSDECISION PROCESS

Idea generationIdea generation

Called concept generation or ideationIdeas obtained from customers by

employing user innovationIdeas obtained from R&D etcMajor 2 sources of new product ideas

Idea screeningIdea screening

Second step and first decision to spend resources

ExampleTwo types of errors must be avoided; go

and dropThree questions considered by the screeners

Concept development and Concept development and TestingTesting

Concept development: Develop marketing and engineering details ExampleConcept testing: Concept statement presented to consumers for their reactions Example Concept should be communicated in the form of verbal

description, sketch, photograph, physical appearance, prototype etc.

Customers are asked questions so as to check whether the concept has strong appeal

Marketing strategy Marketing strategy developmentdevelopment

Designing a marketing strategy for new product based on product concept

This stage considers three parts: First-target market size, sales and profit goals for

first few years Second-planned price, distribution strategy for

first year Third-long run sales and marketing mix strategy

Business AnalysisBusiness Analysis

A review of sales, profits and cost projections of the new product

Estimating total salesEstimating costs and profits

Product DevelopmentProduct Development

Developing the product concept into physical product

R&D designs a prototype, that can be produced quickly at budgeted cost

Example of a mouthwashAfter prototype-alpha and beta testing

Market testingMarket testing

The product and marketing program tested in a more realistic market settings

Product is ready to be dressed up with a brand name and packaging and put into market testing

Three major methods-standard, controlled and simulated test markets

Commercialization Commercialization

Introducing a new product into marketCompany faces high costs, may also have to

spent on advertising and sales promotionThree things taken into consideration:

-when

-where

-to whom

Consumer Adoption ProcessConsumer Adoption Process

Focuses on mental process of an organization

Awareness: The consumer becomes aware of the innovation but lacks information about it.

Interest: The consumer is stimulated to seek information about the innovation.

Evaluation: The consumer considers whether to try the innovation

Trial: The consumer tries the innovation to improve his or her estimate of its value.

Adoption: The consumer decides to make full and regular use of innovation.

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