Chapter 20: new products
Terms in this set (25)
entering new markets by tweaking products for new customers, using variations on a core product to stay one step ahead of the market, and creating interim solutions for industry-wide problems.
Newer companies create ___ ___ that are cheaper and more likely to alter the competitive space.
Reasons for successful new products
1. unique and superior product
2. well defined product concept
3. technological and marketing synergy
4. Quaility of execution in all stages
5. Market attractiveness
8 steps in new Product development
1. Idea generation
2. Idea screening
3. Concept development and testing
4. Marketing strategy development
5. Business analysis
6. Product Development
7. Market Testing
Dont do it, huge market
Go ahead and do it with no market
an elaborated version of the idea expressed in consumer terms.
• Four main methods of consumer goods market testing: from least to most costly
1. sales wave research
2. simulated market testing
3. Controlled test marketing
4. Test markets
Consumers who initially try the product at no cost are reoffered it, or a competitors product at reduced prices. The company notes how many customers select it again and their satisfaction levels.
Sales wave research
Consumers attend a brief screening on a product where both well known and new TV commercials are shown. One ad advertises the new product but does not single it out. The company then notes how many consumers buy the new brand and competing brands.
Simulated test marketing
The company with the new product specifies the number of stores and geographic locations it wants to test. A research firm delivers the product to a panel of participating stores and controls shelf position, pricing and promotion. Electronic scanners measure sales at checkout.
Controlled test marketing
Put the product into full-blown test markets.
Early adopters, heavy users, opinion leaders
2. Early adopters
3. Early majority
4. Late Majority
Characteristics of Innovations: (5)
1. Relative advantage
technology enthusiasts, they enjoy tinkering with new products. In return for low prices, they are happy to conduct alpha and beta testing to report on early weaknesses.
opinion leaders who carefully search for new technologies that might give them a competitive edge. Less price sensitive and willing to adopt the product if given personalized solutions and good service support. (researchers, professors)
: pragmatists who adopt the new technology when its benefits are proven and a lot of adoption has already taken place. They make up the mainstream market.
: Are skeptical conservatives who are risk adverse, technology shy and price sensitive.
tradition-bound and resist the innovation until the status quo is no longer defensible.
The degree to which the innovation appears superior to existing products. The greater the perceived __ ___ (DVR for recording shows), the more quickly it is adopted.
the degree to which the innovation matches the values and experiences of individuals.
The degree to which the innovation is difficult to understand or use.
The degree to which the innovation can be tried on a limited basis. (This provides issue for DVRS because sampling can occur only in retail store or at a friends house) Trying a product before you buy it at no risk.
The degree to which the benefits of use are observable or describable to others. (The fact that DVRS have some clear advantages can help create interest and curiosity).