ch 8 example #56228

One is through acquisition—by buying a whole company, a patent, or a license to produce someone else's product. The other is through the firm's own new product development efforts.

which is the systematic search for new product ideas. Major sources of new product ideas include internal sources and external sources.

Internal social networks Intrapreneurial programs

Distributors and suppliers Competitors Customers

invites broad communities of people—customers, employees, independent scientists and researchers, and even the public at large—into the innovation process.

First, Is it real? Is there a real need and desire for the product and will customers buy it? Is there a clear product concept and will such a product satisfy the market? Second, Can we win? Does the product offer a sustainable competitive advantage? Does the company have the resources to make such a product a success? Finally, Is it worth doing? Does the product fit the company's overall growth strategy? Does it offer sufficient profit potential? The company should be able to answer yes to all three R-W-W questions before developing the new product idea further.

is an idea for a possible product that the company can see itself offering to the market

is a detailed version of the idea stated in meaningful consumer terms

is the way consumers perceive an actual or potential product

calls for testing new product concepts with groups of target consumers. The concepts may be presented to consumers symbolically or physically

development involves designing an initial marketing strategy for introducing a new product to the market.

The first part describes the target market; the planned value proposition; and the sales, market-share, and profit goals for the first few years. The second part of the marketing strategy statement outlines the product's planned price, distribution, and marketing budget for the first year. The third part of the marketing strategy statement describes the planned long-run sales, profit goals, and marketing mix strategy.

involves a review of the sales, costs, and profit projections for a new product to find out whether they satisfy the company's objectives. If the projections satisfy the company objectives, the product can move to the product development stage.

This refers to developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering. The R department will develop and test one or more physical versions of the product concept.

the stage at which the product and its proposed marketing program are introduced into realistic market settings.

new products and tactics are tested among controlled panels of shoppers and stores.

researchers measure consumer responses to new products and marketing tactics in laboratory stores or simulated online shopping environments.

refers to introducing the new product into the market. If a company goes ahead with commercialization, it will face high costs

focuses on finding new ways to solve customer problems and create more customer-satisfying experiences.

Various company departments work together, overlapping the steps in the product development process

Innovation management systems collect, review, evaluate, and manage new product ideas

is a basic and distinctive mode of expression. For example, styles appear in homes (colonial, ranch, transitional), clothing (formal, casual), and art (realist, surrealist, abstract). A style may last for generations, passing in and out of vogue. A style has a cycle showing several periods of renewed interest.

is a currently accepted or popular style in a given field. For example, the more formal "business attire" look of corporate dress of the 1980s and 1990s gave way to the "business casual" look of the 2000s and 2010s. Fashions tend to grow slowly, remain popular for a while, and then decline slowly.

are temporary periods of unusually high sales driven by consumer enthusiasm and immediate product or brand popularity. A fad may be part of an otherwise normal life cycle. Or the fad may comprise a brand's or product's entire life cycle. Pet Rocks are a classic example.

Product development Introduction stage Growth stage Maturity stage Decline stage

Public policy issues Regulations regarding acquiring or dropping products Patent protection Product quality and safety Product warranties

Finding what products and services to introduce and in which countries Deciding on how much to standardize or adapt the products and services for world markets