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12-1,Chapter12DevelopingNewMarketOfferingsby,PowerPointbyMiltonM.PressleyUniversityofNewOrleans,12-2,Whoshouldultimatelydesigntheproduct?Thecustomer,ofcourse.,KotleronMarketing,12-3,ChapterObjectives,Inthischapter,wefocusonthefollowingquestions:Whatchallengesdoesacompanyfaceindevelopingnewproducts?Whatorganizationalstructuresareusedtomanagenew-productdevelopment?Whatarethemainstagesindevelopingnewproducts,andhowcantheybemanagedbetter?Whatfactorsaffecttherateofdiffusionandconsumeradoptionofnewlylaunchedproducts?,12-4,DevelopingNewMarketOfferings,SixcategoriesofnewproductsNew-to-the-worldproductsNewproductlinesAdditionstoexistingproductlinesImprovementsandrevisionsofexistingproductsRepositioningCostreductions,12-5,ChallengesinNew-ProductDevelopment,IncrementalinnovationDisruptivetechnologiesWhydonewproductsfail?Ahigh-levelexecutivepushesafavoriteideathroughinspiteofnegativeresearchfindings.Theideaisgood,butthemarketsizeisoverestimated.Theproductisnotwelldesigned.,12-6,ChallengesinNew-ProductDevelopment,Theproductisincorrectlypositionedinthemarket,notadvertisedeffectively,oroverpriced.Theproductfailstogainsufficientdistributioncoverageorsupport.Developmentcostsarehigherthanexpected.Competitorsfightbackharderthanexpected.,12-7,ChallengesinNew-ProductDevelopment,Factorsthattendtohindernew-productdevelopmentShortageofimportantideasincertainareasFragmentedmarketsSocialandgovernmentalconstraintsCostofdevelopmentCapitalshortagesFasterrequireddevelopmenttimeShorterproductlifecycles,12-8,OrganizationalArrangements,New-productdeploymentrequiresspecificcriteriaonecompanyestablishedthefollowingacceptancecriteriaTheproductcanbeintroducedwithinfiveyearsTheproducthasamarketpotentialofatleast$50millionanda15percentgrowthrate.Theproductwouldprovideatleast30percentreturnonsalesand40percentoninvestment.Theproductwouldachievetechnicalormarketleadership.,12-9,BudgetingForNewProductDevelopment3Msapproach:15%ruleEachpromisingideagetsan“executivechampion”ExpectsomefailuresGoldenStepawardshandedouteachyear,OrganizationalArrangements,12-10,3Monline:The3MInnovationNetwork,12-11,Table12.1FindingOneSuccessfulNewProduct(Startingwith64NewIdeas),12-12,OrganizationalArrangements,OrganizingNew-ProductDevelopmentProductmanagersNew-productmanagersHigh-levelmanagementcommitteeNewproductdepartmentVentureteams,12-13,Stage-gatesystemGatekeepersmakeoneoffourdecisions:GoKillHoldRecycle,OrganizationalArrangements,12-14,IdeaGenerationInteractingwithOthersSalesrepresentativesIntermediariesProductchampion,ManagingtheDevelopmentProcess:Ideas,12-15,TechniquesforstimulatingcreativityinindividualsandgroupsAttributelistingForcedrelationshipsMorphologicalanalysisReverseassumptionanalysisNewcontextsMind-mapping,ManagingtheDevelopmentProcess:Ideas,12-16,IdeaScreeningIdeamanagerIdeacommitteeTwotypesoferrorsinscreeningideasDROP-errorGO-error,ManagingtheDevelopmentProcess:Ideas,12-17,Someofthemostnotable“drop-errors”havecomefromthemostrecognizablenamesinAmericanbusiness.Xeroxsawthepotentialofthecopymachine,IBMandEastmanKodakdidnot.IBMthoughtthepersonalcomputermarketwouldbeminiscule.Canyouthinkofany“drop-errors”thatthecompanydidntsurvive?,DiscussionQuestion,12-18,Table12.2Product-IdeaRatingDevice,12-19,ManagingtheDevelopmentProcess:ConcepttoStrategy,ConceptDevelopmentandTestingProductideaProductconceptConceptdevelopmentCategoryconceptProductpositioningmapBrandconcept,12-20,Figure12.3:ProductandBrandPositioning,12-21,Sometimesanewproductisdeveloped,likethefelt-tippenandthe“walkman”stylepersonalmusicdevice.Consumerswerentclamoringforeitheroftheseproductsbeforetheycametomarket.Mostpeoplehadntevenconceivedofsuchanitem.Carefulplanningdevelopedmarketsforthesenewlines.Canyouthinkofmorerecentexamples?,DiscussionQuestion,12-22,ManagingtheDevelopmentProcess:ConcepttoStrategy,ConceptTestingRapidprototypingVirtualrealityCustomer-drivenengineeringQuestionstomeasureproductdimensionsCommunicabilityandbelievabilityNeedlevelGaplevelNeed-gapscore,12-23,ManagingtheDevelopmentProcess:ConcepttoStrategy,PerceivedvaluePurchaseintentionUsertargets,purchaseoccasions,purchasingfrequencyConjointAnalysisExample:fivedesignelementsThreepackagedesignsThreebrandnamesThreepricesPossibleGoodHousekeepingsealPossiblemoney-backguarantee,12-24,ManagingtheDevelopmentProcess:ConcepttoStrategy,MarketingStrategyBusinessAnalysisEstimatingTotalSales,12-25,ManagingtheDevelopmentProcess:ConcepttoStrategy,Survival-agedistributionEstimatingCostandProfits,12-26,Table12.3ProjectedFive-Year-Cash-FlowStatement(inthousandsofdollars),Seetextforcompletetable,12-27,ManagingtheDevelopmentProcess:ConcepttoStrategy,Break-evenanalysisRiskanalysis,12-28,ManagingTheDevelopmentProcess:DevelopmenttoCommercialization,ProductDevelopmentQualityFunctionDeployment(QFD)Customerattributes(CAs)Engineeringattributes(EAs),LandsEndJapanWebsite,12-29,ManagingTheDevelopmentProcess:DevelopmenttoCommercialization,CustomertestsAlphatestingBetatestingConsumerpreferencemeasuresRank-orderPaired-comparisonMonadic-rating,12-30,ManagingTheDevelopmentProcess:DevelopmenttoCommercialization,MarketTestingConsumer-GoodsMarketTestingSeekstoestimatefourvariablesTrialFirstrepeatAdoptionPurchasefrequencySaleswaveresearch,12-31,ManagingTheDevelopmentProcess:DevelopmenttoCommercialization,SimulatedTestMarketingControlledTestMarketingTestMarketsHowmanytestcities?Whichcities?Lengthoftest?Whatinformation?Whatactiontotake?Business-GoodsMarketTesting,12-32,ManagingTheDevelopmentProcess:DevelopmenttoCommercialization,PhilipsProntoWebsite,CommercializationWhen(Timing)FirstentryParallelentryLateentryWhere(GeographicStrategy),12-33,ToWhom(Target-MarketProspects)How(IntroductoryMarketStrategy)Criticalpathscheduling(CPS),ManagingTheDevelopmentProcess:DevelopmenttoCommercialization,TheiMac,launchedwithadramaticcountdowncampaign,12-34,TheConsumer-Adoptio
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