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Concept Evaluation System (Chapter 8) - Coggle Diagram
Concept Evaluation System (Chapter 8)
the evaluation system
New Product Process Phase
Opportunity Identification and selection
Direction: Where should we look?
-opportunity identification
-market descriptions
Concept generation
Initial review: is the idea worth screening?
-the product innovation charter
-immediate judgmental responses
-preliminary market analyses
-concept testing
Concept/project evaluation
Full screen: should we try to develop it?
-checklists
-profile sheet
-scoring models
Development
Progress reports: have we developed it? if not, should we continue to try?
-protocol checks
-prototype tests
-concept tests
-product use tests
Launch
Market testing: should we market it? if so, how?
-speculative sale
-simulated test market
-informal selling
-controlled sale
-test marketing
-rollout
-economic summary
concept evaluation system
cumulative expenditures curve: accumulation of costs or expenditures on a typical new product project from its beginning to its full launch
early expenditures curve (many high-tech products): representative of product development in technical fields
late expenditures curve (many consumer products): representative of product development in consumer packaged goods
decay curve: % of new product concepts that survive through the development period
the A-T-A-R model: based on how we forecast sales and profits on a new item
Buying unit: purchase point
Aware: heard about the new product with some characteristics that differentiates it
Trial: means a purchase or consumption of the product
Available: effort to find the product is successful
Repeat: product is bought at least once more or recommended to others
model of innovation diffusion
profits: units sold x profit per unit
profits: buying units x % aware x % trial x %a availability x measure of repeat x (revenue per unit - costs per unit)
profits per unit: revenue per unit - cost per unit
profit contribution: potential x AW x T x AV x R x Margin
risk payoff matrix
mitigation (reduce)
transfer (move)
avoidance (eliminate)
acceptance (contingency)
planning the evaluation system
potholes
-know what the really damaging problems are for the firm
-focus on them when evaluating concepts
people
-proposal may be hard to stop once there is buy-in on the concept
-need tough demanding hurdles
-personal risk associated with new product development
-need system that protects developers and offers reassurance
surrogates
surrogates questions give clues to the real answer
rolling evaluation
-project is assessed continuously
-financial analysis needed
-not enough data early
-risk of killing off too many good ideas early
-marketing begins early in the process
-key: avoid good/bad mindsets, avoid premature closure
