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Chapter 9 New-Product Development and Product Life-Cycle Strategies -…
Chapter 9
New-Product Development and
Product Life-Cycle Strategies
New-Product Development Strategy
Acquisition :
New product development
New-Product Development Process
Idea Generation
Internal sources refer to the company's own formal research and development, management and staff, and intrapreneurial programs.
External sources refer to sources outside the company such as customers,company such as customers,competitors,distributors,suppliers,and outside design firms.
Idea Screening : Identify good ideas and drop poor ideas
Concept Development and Testing
Product concept
Product idea
Product image
Marketing Strategy Development
Marketing Strategy Development refers to the initial marketing strategy for introducing the product to the market
Value proposition
Sales and profit goals
Description of the target market
Business analysis
Product development
Test marketing
Disadvantages
Not considered as reliable and accurate due
to the controlled setting
Advantages
Faster
Restricts access by competitors
Less expensive than other test methods
Commercialization is the introduction pf the new product : when to launch, where to launch, planned market rollout
Managing New-Product Development :
Customer-centered new product
development
Sequential new-product development
Team-based new-product development
Systematic new-product development
Product Life-Cycle Strategies :
Product Life Cycle
Introduction Stage
Slow sales growth
Little or no profit
High distribution and promotion expense
Growth Stage
Sales increase
New competitors enter the market
Price stability or decline to increase
volume
Consumer education
Profits increase
Promotion and manufacturing costs gain
economies of scale
Maturity Stage
Many suppliers
Substitute products
Slowdown in sales
Increased promotion and R&D to
support sales and profits
Overcapacity leads to competition
Maturity Stage Modifying Strategies
Product
modifying
Marketing mix
modifying
Market modifying
Decline Stage
Harvest the product
Drop the product
Maintain the product