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Chapter 20 - Introducing new market offerings. After studying this chapter you will be able to understand: What challenges does a company face in developing new products and services? What organizational structures and processes do managers use to oversee new-product development? What are the main stages in developing new products and services? What is the best way to manage the new-product development process?
Phillip Kevin Lane Kotler • Keller Marketing Management • 14e Ch r e t p a Introducing New Market Offerings Discussion Questions What challenges does a company face in developing new products and services? What organizational structures and processes managers use to oversee new-product development? What are the main stages in developing new products and services? What is the best way to manage the new-product development process? What factors affect the rate of diffusion and consumer adoption of newly launched products Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide of 31 New Product Options Make or Buy w e N Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Improve d Formula Types of New Products Slide of 31 New-Product Development Challenges The Innovation Imperative New Product Success Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall New Product Failure Slide of 31 Organizational Arrangements Organizing New Product Development Customer-driven Engineering Budgeting for NPD Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide of 31 Ta e l b 20 Finding One Successful New Product Stage Number of Ideas Pass Ratio Cost per Idea Total Cost Idea Screening 64 1:4 $1,000 $64,000 Concept Testing 16 1:2 20,000 320,000 Product Development 1:2 200,000 1,600,000 Test Marketing 1:2 500,000 2,000,000 National Launch 1:2 5,000,000 10,000,000 $13,984,000 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide of 31 Organizing New Product Development Cross-functional Teams “Skunkwork s” Stage-gate Systems Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide of 31 e r u g Fi 0.1 New-Product Decision Process Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide of 31 Generating Ideas Employee s Crowd Sourcing Competitor Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Lead Users Slide 10 of 31 Concept Testing Product Dimensions 1.Communicability and Believability 2.Need level 3.Gap level 4.Perceived value 5.Purchase intention 6.User targets, purchase occasions, frequency Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 17 of 31 e r u g Fi 0.4 Conjoint Analysis Design Elements •Three package designs (A, B, C) •Three brand names (K2R, Glory, Bissell) •Three Prices ($1.19, $1.39, $1.59) •A possible Good Housekeeping seal (yes, no) ãA possible money-back guarantee (yes, no) Copyright â 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 18 of 31 e r u g Fi 0.5 Continuum of Evaluation for Products Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 19 of 31 Marketing Strategy Development Target Market’s • Size • Structure • Behavior Marketing-mix strategy Marketing Mix Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 20 of 31 Business Analysis Estimating Total Sales Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Estimating Costs and Profits Slide 21 of 31 e r u g Fi 0.6 PLC Sales for Three Types of Products Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 22 of 31 Development to Commercialization Product Development Market Testing Commercializati Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 23 of 31 Product Development Physical Prototype Alpha Testing (Internal) Beta Testing (Customers) Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Customer Tests Slide 24 of 31 Market Testing Sales-Wave Research Controlled Test Marketing Simulated Test Marketing Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Test Markets Slide 25 of 31 Commercialization When ? Where? How? To Whom? Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 26 of 31 The Consumer-Adoption Process Stages in the Adoption Process Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 27 of 31 The Consumer-Adoption Process Influencing Factors • Buyer Readiness • Personal Influence • Innovation Characteristics • Organizations Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 28 of 31 Buyer Readiness Early Majority Laggard s Innovators Early Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Late Majority Slide 29 of 31 e r u g Fi 0.7 Continuum of Evaluation for Products Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Slide 30 of 31 Innovation Characteristics Divisibility Compatibility Relative Advantage Complexity Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall Communicabilit Slide 31 of 31 ... 31 Marketing Strategy Development Target Market’s • Size • Structure • Behavior Marketing- mix strategy Marketing Mix Copyright © 201 2 Pearson Education, Inc Publishing as Prentice Hall Slide 20. .. Cross-functional Teams “Skunkwork s” Stage-gate Systems Copyright © 201 2 Pearson Education, Inc Publishing as Prentice Hall Slide of 31 e r u g Fi 0.1 New-Product Decision Process Copyright © 201 2... performance-to-cost ratio 30 18 High marketing dollar support 20 14 Lack of strong competition 10 05 Total Overall probability of success 1.00 Probability of technical completion Copyright © 201 2 Pearson