1. For use only with Shapiro, Wong, Perreault, and McCarthy texts. Copyright © 2002 McGraw-Hill Ryerson Limited. Chapter 10: Product Management and New-Product Development

2. For use only with Shapiro, Wong, Perreault, and McCarthy texts. Copyright © 2002 McGraw-Hill Ryerson Limited. The Product Life Cycle 10-2 Exhibit 10-1 Total Industry Profit + – $ 0 Market Introduction Market Growth Market Maturity Sales Decline Total Industry Sales Time

3. For use only with Shapiro, Wong, Perreault, and McCarthy texts. Copyright © 2002 McGraw-Hill Ryerson Limited. Introducing New Products Managing Mature Products Future Adaptation New Markets Dying Products Budget / Rate of Growth Persuasion / Less Profit New or Improve? New Strategies Phase Out Focus: Planning for Life Cycle Stages 10-3

4. For use only with Shapiro, Wong, Perreault, and McCarthy texts. Copyright © 2002 McGraw-Hill Ryerson Limited. 10-4 New-Product Development Process Exhibit 10-5 Idea Generation Ideas from: Customers and users Marketing research Competitors Other markets Company people Intermediaries Screening Strengths and weaknesses Fit with objectives Market trends Rough ROI estimate Idea Evaluation Concept testing Customer reactions Rough estimates of cost, sales, profits Development R & D Develop model or service prototype Test marketing mix Revise plans as needed ROI estimate Commercial -ization Finalize product and marketing plan Start production and marketing “Roll out” in select markets Final ROI estimate

5. For use only with Shapiro, Wong, Perreault, and McCarthy texts. Copyright © 2002 McGraw-Hill Ryerson Limited. Long-Run Consumer Welfare Immediate Satisfaction Desirable Products Pleasing Products Salutary Products Deficient Products High Low High Low Types of New Product Opportunities 10-5 Exhibit 10-6

6. For use only with Shapiro, Wong, Perreault, and McCarthy texts. Copyright © 2002 McGraw-Hill Ryerson Limited. Key Issues Top Level Support Market-Guided R & D Integration & Coordination Authority 10-6 New-Product Development Management