New Product Development
New Product Development refers to the process of creating and bringing a new product to the market. It involves idea generation, concept development, market research, and product design, leading to the launch and commercialization of the new offering. This process typically aims to meet customer needs, gain a competitive advantage, and drive business growth.
8 Key excerpts on "New Product Development"
eBook - ePub- Ahmed Hassanien, Crispin Dale(Authors)
- 2019(Publication Date)
- Routledge(Publisher)
...This includes invention as well as the work required to bring an idea or concept into final form. An innovation may have various degrees of newness, from very little to highly discontinuous, but that must include at least some degree of newness to the market not just to the firm (Crawford 1994: 472). New Product Development (NPD) New Product Development involves developing ‘A good, service or idea that is perceived by some potential customers as new’ (Kotler and Armstrong, 2004: 215). NPD categories NDP categories are major innovations; start-up business; new products for currently served markets; product-line extensions or additions; improvements to existing products; and style changes (Lovelock, 1996). NPD classes NPD classes are categories of new products: new-to-the-world products (new products that create an entirely new market); new product lines (new products that allow a company to enter into an established market for the first time); additions to existing product lines (new products that supplement a company’s established product lines); improvements to existing products (new products that provide increased performance or greater perceived value and replaced existing products); repositioning products (existing products that are targeted to new markets or market segments) and reducing costs (new products that provide similar performance at lower cost) (Cooper, 1993). NPD process The NPD process encompasses the different stages and activities that assist in successfully introducing a new product. Bibliography and additional reading Alam, I., 2002. An exploratory investigation of user involvement in new service development. Journal of the Academy of Marketing Science 30 (3), 250–261. Alam, I., Perry, C., 2002. A customer-oriented new service development process. Journal of Services Marketing 16 (6), 515–534. Ansoff, I., 1988. New Corporate Strategy. John Wiley & Sons, New York. Baker, M., 2000. The Marketing Book, third ed...
eBook - ePubThe Marketer's Handbook
Reassessing Marketing Techniques for Modern Business
- Laurie Young(Author)
- 2011(Publication Date)
- Wiley(Publisher)
...They might include: sales performance; ease of market access; speed of market acceptance; competitive performance; revenue growth; cost performance; “other booster” (i.e. how it affects other sales and costs). History, Context, Criticism, and Development The proactive creation of new products has been established practice for many years in a number of different businesses selling physical products. Leading organizations in markets where new product innovation is a critical success factor, like consumer products, have highly sophisticated processes, which are managed at a senior level in the firm. As a result, NPD processes and concepts are well established and known to provide demonstrable value. Research has shown, for example, that a new product design process in manufacturing reduces risk of failure; also that successful innovation is both costly and risky but an NPD process reduces these costs. In 1991 Canada’s Ulrike de Brentani (de Brentani, U., 1991) conducted research designed to apply the “conceptual and research paradigms that have evolved from studies of new manufactured goods to services”. He concluded that the strategic issues facing service organizations were similar to those for product companies. While NPD technologies and the detailed steps in the process may vary, the underlying notions behind their use do not. In fact, many leading service organizations now use a formal innovation process; as the Interoute case study demonstrates. They also create as many good ideas as possible and then reduce the number of ideas by careful screening to ensure that only those with the best chances of success get launched...
eBook - ePubMarketing Theory
A Student Text
- Michael J Baker, Michael Saren(Authors)
- 2016(Publication Date)
- SAGE Publications Ltd(Publisher)
...In order to combine technical and marketing expertise, a number of company functions have to be involved: R&D, manufacturing, engineering, marketing, finance and sales. Linked to these is also the need for the voice of the suppliers, where changes to supply may be required or advantageous and other third parties, such as venture capitalists, brokers, and, increasingly, sources of intellectual property. The need to develop product advantage. Technical and market information, which are building blocks of NPD, have to be both accurate and timely, and must be constantly reworked in the light of changing circumstances during the course of the development, to ensure that the product under development has competitive advantage in the eyes of the customer. Therefore the people must deliver the appropriate expert information to inform the process. The need for speed in the process. As discussed above, the NPD process has to be managed in such a way as to be quick enough to capitalize on the new product opportunity before competitors do. The extent to which people work together enhances the speed of the process. These three recurrent factors underline the importance of finding mechanisms and processes to encourage information sharing and decision taking across multiple boundaries both within one organization and across organizations. Research has covered a variety of aspects concerning these, for example, the R&D–marketing interface (Gupta and Wilemon, 1988); the marketing–design interface (see the Journal of Product Innovation Management Vol. 22, Nos. 1 & 2, 2005 for several articles in this area; in addition to Rubera and Droge, 2013); marketing and engineering (Michalek et al., 2005; Shaw and Shaw, 1998); marketing, R&D and finance (Hempelmann and Engelen, 2015)...
eBook - ePubEntrepreneurial Marketing
How to Develop Customer Demand
- Edwin J. Nijssen(Author)
- 2021(Publication Date)
- Routledge(Publisher)
...It is core to entrepreneurship. It involves several steps, including new product idea generation and selection, concept development, prototyping, market testing, and launch. While at every stage of the process both technical and marketing issues co-exist, 3 most entrepreneurs (but also many large firms) limit marketing and sales’ effectiveness by leaving it till the end. They first develop the new product and then hand it to marketing and salesperson, telling them: ‘Now do your best.’ So “[w]hile customer input may be a checkpoint or ‘gate’ in the [New Product Development] process it [often] doesn’t drive it”. 4 This approach is a road to disaster. The winners at the game of New Product Development follow a different approach; they invent and live by a process of discovery and experimenting with customers in order to learn. 5 Consistent with this, Blank 6 suggested that start-ups should complement their New Product Development process with a formal customer development one. He coined the term ‘customer development’ and used it to describe the parallel process of building a continuous feedback loop with customers throughout the product development cycle. This customer development process concerns locating a start-up’s first customers, validating its assumptions about customer needs and behaviour, and growing its business by extending its small, initial customer base. Figure 7.1 The complementary processes of new product and customer development Figure 7.1 shows the two parallel processes of new product and customer development. We show them as complementary phenomena with serious, and preferably systematic, information exchange between them...
eBook - ePubMarket Research in Practice
An Introduction to Gaining Greater Market Insight
- Paul Hague(Author)
- 2021(Publication Date)
- Kogan Page(Publisher)
...23 Using market research to launch a new product Why launching new products is important Innovation is a key growth driver in business and industry. New Product Development fuels future revenue for it is said that at least 30 per cent of a company’s products have typically been developed within the past five years. In addition to driving organic growth, innovation is a source of differentiation. When a company introduces a new product, it is considered forward looking with an improved offering. Innovation can be as much about building a brand as about refreshing, expanding or creating a product portfolio. Defining a new product There are three types of new products, as shown in Figure 23.1. Breakthroughs are market-leading innovations and are the most challenging to generate as they are brand new and never been seen before. Line extensions are additional products within a product family or range. Product refreshes are next generation products that are usually improved in some way, either for the user and/or for the manufacturer. Line extensions and product refreshes are much easier and quicker to create and they tend to respond to market demand. In addition to internal product development initiatives and consumer demand, various forces impact on New Product Development such as competitors with their latest products, or raw material suppliers with substitute products or shortages. Figure 23.1 The three types of new product Figure 23.1 details The details of the three products are as follows: the new products are breakthroughs which come in market-leading innovation and line extensions and product refreshes in market-led enhancement. The external forces that influence the products are competitors, alternative products, substitutes, etcetera and suppliers, example raw material shortages. The role of market research in New Product Development Given the importance of New Product Development, most large companies allocate substantial budgets to research and development...
eBook - ePubInnovating for Sustainability
Green Entrepreneurship in Personal Mobility
- Luca Berchicci(Author)
- 2008(Publication Date)
- Routledge(Publisher)
...That is, a higher level of advocacy may increase resource investments in a project for reasons other than expectation of economic returns. In conclusion, when undertaking radical NPD processes, rational and nonrational factors may be equally important in the decision-making process (Green et al., 2003; Schmidt et al., 1998). High expectations and prospects, self-justification, psychological rewards and emotional involvements are some of the explanatory factors for escalations of commitment in (radical) NPD projects. 2.4.4 Decisions and team coordination within NPD projects Product development is a complex process where decisions are made by a coordinated and competent cross-functional team that includes people from different functions (Brown et al., 1995; Dougherty, 1992). To a great extent, success depends on the communication and collaboration among the various members of the team (Brown et al., 1995; Cooper & Kleinschmidt, 1986; Cooper et al., 1995a; Dougherty, 1992). Remarkably, Dougherty (1992) found that in large firms differences in interpretation 17 between the members of a team may act as a barrier rather than a lubricant. This type of barrier may be one explanation for the poor performance of some new products. Different members of a development team will emphasize different aspects of innovation depending on their place and function within the organization. Due to the above-mentioned differences in interpretation, the development of new products for new markets 18 is even more difficult (Dougherty, 1990). 2.4.5 Product specifications Product development is a complex process involving a number of decisions that have to do with the kind of attributes products should incorporate. Manufacturers and designers attempt to develop products whose unique attributes create value for customers. A successful product contains a set of attributes that are by definition balanced...
eBook - ePub- Mike Baxter(Author)
- 2018(Publication Date)
- CRC Press(Publisher)
...This establishes medium- to long-term goals for the company, allowing skills and expertise to develop in specific aspects of innovation. On-going innovation according to an agreed strategy has been shown to make New Product Development much more efficient than intermittent projects lacking such continuity [ 4 ]. Pursuing this one type of opportunity, however, still carries a high risk. What if you have decided to reduce costs and cut prices at a time when the market is looking for enhanced value and new features? It may take several product failures before the mistake is realised. Product design and development Next come the stages of development of a particular new product. This involves less risk and uncertainty than either of the preceding stages (deciding strategy and the innovation opportunity) [10]. It also further reduces the risk and uncertainty, step-wise and progressively as decisions are made on i) the specific product opportunity to be exploited ii) the principles of operation of the product (concept design) iii) how the product is going to be made (embodiment design) and finally iv) the detail design and production engineering. Clearly, risk and uncertainty will still remain, even when the new product is stockpiled in the warehouse ready for sale. But minimising that risk and uncertainty is the essence of effective product development...
eBook - ePub- Takuji Hara, Norio Kambayashi, Noboru Matsushima, Takuji Hara, Norio Kambayashi, Noboru Matsushima(Authors)
- 2008(Publication Date)
- Routledge(Publisher)
...According to Brown and Eisenhardt (1995), Japanese NPD capability research can be categorized into a stream similar to problem-solving. They reviewed comprehensive literature pertaining to NPD research and classified it into three perspectives: NPD as a rational plan whose success stems from a superior product, attractive market, and rational organization; NPD as a communication web whose success stems from internal and external communication; NPD as successful disciplined problem-solving. The first perspective has little theoretical basis and considers too many variables; however, it has triggered the present research. The second and third perspectives provide more theoretical contribution for a more constructive discussion as will be subsequently classified. The second perspective regarding NPD research, which treats internal and external communication as a key variable for NPD success, is important for our consideration of knowledge integration between international R&D bases or among collaborating partners. The essence of communication in NPD management pertains to the method of facilitating communication channels for forging effective NPD by linking people who belong to different business units (such as function, group, or division) based on different knowledge and perspective. The key player, who acts as a network-hub for effective communication in the NPD project, is called a gatekeeper (Allen 1977; Brown and Eisenhardt 1995). The gate keeper informs and translates information among NPD project team members or with outsiders by increasing the amount and variety of information available in the design process...
