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The creation of products withnew characteristics that offer

additional benefits tothe customers.

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To add to product portfolioTo replace declining product

To defeat rivals

To maintain/increase market shareTo maintain competitive advantage

Make better use of the organization's

resources

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New to the world high definition

TV, ipod, flat screen TV,tabs.

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Idea Generation

Product Screening Concept

Testing Business & FinancialAnalysis

Product Development Test

Marketing Commercialization

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Idea generation is the systematic search for new-product

ideas.

The purpose of idea generation is to create a large number

of ideas.

IBM recently held an Innovation Jam in which it

invited customers, employees worldwide to submit ideas

for new products and services. The brainstorming session

generated some 46,000 ideas in over three days. However,IBM had boiled down these huge number of ideas to only

10 products, businesses and services.

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Two major sources are- Internal idea sources

- External idea sources

Internal idea sources- formal R&D, employeesranging from executives to scientists, engineers,

manufacturing staff, sales people and the top

management.

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Cisco has set up an internal wiki called Idea

Zone or I-Zone, through which any Ciscoemployee can propose an idea for a new

product or comment on or modify someone

elses proposed idea. Since its inception, I-Zone has generated more than 400 business

ideas. So far twelve izones ideas have reached

the project stage.

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In product screening poor, unsuitable

or otherwise unattractive ideas areweeded out form further actions

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An attractive idea must be developed into a productconcept.

key terms-product idea, product concept.

Product idea- is an idea for a possible product thatthe company can see itself offering to the market.

Product Concept- is a detailed version of the idea

stated in meaningful consumer terms.

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Concept developmentEXAMPLE-

Suppose a car manufacturer wants tointroduce an affordable, mass market hybrid-powered car models.

A marketer might create the following

product concepts for the electric car.

Concept1 An affordably priced midsize cardesigned as a second family car to be used

around town.Concept2 A mid-priced sporty compactappealing to young singles and couples.

.

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After being exposed to the concept,consumers then may be asked to react to itby answering questions like

-do you understand the concept of a

battery powered electric car?- do you believe the claims about thecars performance?

- what improvements in the cars

features would you suggest?- what would be the reasonable price to

be charged for the car?

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The company projects cost, profit, return oninvestment and cash flow if the product is

placed on the market.

Projections of potential sales at various pricesneed to be made, as well as detailed cost

projections for different volumes of

production.

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Demand projections

CompetitionRequired investment

Profitability

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Product development converts a product idea into a

physical form and identifies a basic marketing

strategy.

R&D or engineering develops the product conceptinto product development

Products undergo rigorous tests to make sure that

they perform safely and effectively.

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Test marketing involves placing a productfor sale in one or more selected areas and

observing its actual performance under the

proposed marketing plan.

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Commercialization involves

implementing a total marketing plan and

full production

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Operating Philosophy

Organization Structure

The Experience Effect

Management Style

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Factor 2:A Clear and Well-

Communicated New ProductStrategy for the Business

There should be a clear goals forthe new product

The role of new product in achievingthe goal should be clearly

communicated to those who needs toknow that

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Factor 3:

Adequate Resources for NewProducts

Resources like people , moneyand marketing should be devoted

Completely to achieve new

innovation in the product.

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We can say that product development is

necessary to establish a competitive edge

for the organization.

For long term survival the organization

should make their product obsolete before

their customer do.

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Thank you