Lecture%20Ten_Developing%20New%20product%20and%20PLC_F

Lecture%20Ten_Developing%20New%20product%20and%20PLC_F -...

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MGCR 352 Developing New Product & Product Life Cycle Chun Martin Qiu
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2 Marketing Management Learning Objectives Understanding the concepts and importance  of new product development Understanding the stages to develop new  products  Understanding product life cycles process  and identifying appropriate marketing  strategies at different stages of product life  cycle
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3 Marketing Management New Product Development New product development The development of original products, product  improvements, product modifications, and new  A risky business 44% of all new products that enter the market fail  Failure rate for industrial products is 30%.
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4 Marketing Management What it Takes to Launch One Commercially Successful New Product 3,000 300 200 100 0 “Raw” unwritten ideas Ideas submitted to firm’s patent department “Small” projects “Significant” developments “Major” developments Commercial “product launches” “Commercially successful” new product 3,000 300 125 9 4 1.7 1 Time Number of ideas, projects, and products
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5 Marketing Management What is a New Product? Newness in legal terms – up to 12 months in  Canada
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6 Marketing Management What is a New Product? Newness from the  company’s perspective  –  line extension, significant innovation /  improvement, true innovation Double-blade Three-blade Five-blade
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7 Marketing Management What is a New Product? Newness from the  consumer’ perspective  –  degree of learning required
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8 Marketing Management Type of Innovations
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9 Marketing Management Why Develop New Products? Follow changing market demands. Remain competitive. Keep up to changing technology. Replace dying products. Refresh and evolve existing products. Diversify product offering to reduce risk.
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10 Marketing Management Reasons for Product Failure Insignificant “point of difference” Poor execution of the marketing mix Poor product quality Bad timing A high-level executive pushes a favorite idea  through in spite of negative research findings. The idea is good, but the market size is  overestimated.
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11 Marketing Management New Product – Just a Great Idea, or More?
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12 Marketing Management Stage 1: Idea Generation Sources of new ideas. External  Customers and suppliers Competitive products Internal Employees Research and development
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Marketing Management Example: 3M Post-it The original adhesive used in  Post-it notes was invented in  1968 by a 3M researcher. He  attempted to design a strong  adhesive, but instead developed  an adhesive that was very weak. Later his colleague found a use 
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This note was uploaded on 04/07/2009 for the course MRKT 101 taught by Professor Wormer during the Spring '08 term at McGill.

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Lecture%20Ten_Developing%20New%20product%20and%20PLC_F -...

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