Module8 - New-Product Development Introduction In Module 6,...

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New-Product Development Introduction In Module 6, we talked about products and services. Now, we're going to go back and take that discussion a little further, to look specifically at new products and the development of those products. Like living creatures, all existing products are born, go through various stages in life, and eventually die. And like parents, marketers must guide these products through their development so that someday they can be sent off into the world to stand alone -- in the market. In this module, we'll explore the general stages of new-product development. We'll look at the steps involved in getting a new product from the idea stage to a reality. We'll also look at the different stages in each product's lifecycle and evaluate how marketers use their understanding of those stages in order to successfully grow their products and the revenues they generate. Student Outcomes Describe the different stages of new-product development. Understand how companies manage the development of new products. Understand the product life cycle and the implications that life cycle has on business and marketing. Assignments Read: Apple: Remade Through New-Product Innovation Read: Electrolux: Cleaning Up with Customer-Centered, Team- Based New-Product Development Assignment 8.1: New-Product Development Multimedia Look for references to the following multimedia in this module: Narrated Slideshow: New-Product Development
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New Products – Overview New products include original products and improved and modified versions of existing products. New products are important in continuing to meet the growing and changing needs of customers. They are also a key part of business growth. When you look at a company like Apple, it's easy to see that companies that excel at developing and managing new products can stand to reap huge rewards. But new-product development can be very expensive and very risky. For example, Texas Instruments lost $660 million before it withdrew from the home computer business. Other costly product failures include Coca-Cola's New Coke, Anheuser- Busch's Eagle Snacks, McDonald's Arch Deluxe sandwiches, and Kellogg's Breakfast Mates cereal-milk combos. It's estimated that of the 30,000 new foods, beverages, and beauty products launched each year, about 70-90 percent will fail in the first 12 months after their release. Yikes! Why do so many products fail? Well, there are many reasons a product might fail. First, even if the product is a conceptually good one, the company may overestimate the product's potential market. Or perhaps the product is poorly developed. Even if the product is designed well and there is a sizeable market, the company may position or promote the product poorly. Another reason a product might fail is that the costs of development may be so significant that it substantially hinders the profit potential for the product. Maybe the developing company did everything well, but the product failed because competitors
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Module8 - New-Product Development Introduction In Module 6,...

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