The Product Development Process BMI3C

Why? Product development starts with an idea that is based on solving a problem for the consumer. To solve this problem a company has two choices. It can either: invent a new device, method, or process OR innovate a product or service by using new technology, items, or processes to change existing products changing the methods used to produce products changing the ways used to distribute them

Idea generation Market research indicates that consumers want a new product 0R an existing product modified Marketing teams will brainstorm on ways to improve a product (often use comments made by the consumers as a basis for their ideas)

Idea screening Need to test consumer reaction to new ideas Need to look at the competitive situation in the market

Concept development If there is a positive consumer response If the market is increasing or is large If there is little or NO competition the company will go ahead with the idea and design a prototype which is a sample of what the product might look like and how it might operate The prototype is tested to establish whether it works. The prototype is market-tested to determine is consumers like it AND WHICH consumers like it the most (to establish a target market)

Market strategy The company develops a marketing strategy to target the primary market The company creates a marketing plan to implement this strategy

Feasibility study This is done in combination with the development of the market strategy The company will need to determine the materials needed, the price, the distribution channels, cost of advertising, promotion, transportation, storage, packaging, and developmental costs. The company MUST be able to create a product that they can make and sell; that the consumers want and will pay the price for; and that will produce a profit for the company

Product design Product design must take into account the primary market preferences (design features PLUS warranty, instruction manual, packaging, and service)

Test marketing To test consumer acceptance a group is selected to test the product for a period of time and then they would be surveyed to determine whether they would buy this product

Market entry At this stage, the product enters the product life cycle

What does it all look like? See diagram on p.175