Developing New Products

Invention versus Innovation Invention is the discovery of new ideas and methods Innovation occurs when an invention is commercialised by bringing it to market

What is a new product? New Products Additions to Product existing New-to-the-world products New product lines New Products Product replacements Additions to existing

This new product replacement from Dyson is an improvement on an existing product.

Creating and nurturing an innovative culture Reward success heavily Clear messages about the role and importance of innovation Back words with resources Resist automatic nay-saying Give time Off or ‘turn a blind eye’ to people working on pet projects Tolerate failure Be accessible Innovative culture

Organising effectively for new product development Project teams Product and brand managers New product departments and committees Importance of teamwork

Organising effectively for new product development Role of marketing directors Encourage teamwork Improve the provision of marketing information to R&D Take R&D people out of lab Develop informal relationships with R&D Learn about technology Formalise the product development process Role of Senior management Make organisational design changes Show a personal interest in new product development Provide strategic direction Encourage teamwork Increase resources Understand marketing's importance

The eight-stage new product development process New product strategy Idea generation Screening Concept testing Business analysis Product development Market testing Commercialisation New products

Nike continues to be at the forefront of the specialist shoe market.

Sources of new product ideas Internal scientists engineers marketers sales people designers Brainstorming may be used. External consumers/customers competitors distributors Marketing research may be used.

Concept testing Techniques. Group discussions. Quantitative research using action standards. The scenario method.

Becks New concepts like the introduction of Beck’s alcohol-free larger will be tested before development and launch.

Product development Key issues. Multi-disciplinary project teams. Target costing. Time to market. Marketing’s role. Product testing.

Market testing Techniques. Simulated market test. Test marketing.

Diffusion of an innovation 34% 16% 13.5% 2.5% Innovators Early adopters Early majority Late majority Laggards Percentage adopting Time

How the characteristics of a product affect its rate of diffusion

Product replacement strategies Inconspicuous technological substitution Relaunch Conspicuous technological substitution No change Facelift Re-merchandising Intangible positioning Tangible positioning Neo-innovation Modified Technology change Re-mix New/market segment Marketing Product

Core Reading Core reading to support this topic can be found in Chapter 11 of your recommended text