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New Product Development

1st July 2012

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What is New Product Development (NPD)?

NPD is the complete process to develop, test and assess the viability of products or services that are new to the market to ensure growth and survival of

an organization.

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Not all NPD has to do with completely new products it can be about existing products

Market Development

Market Penetration

Diversification

Product Development

New Market

Existing Market

Existing Product New Product

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It is important to know the stages of new product / service development

New Product Strategy Development

Idea Generation

Screening& Evaluation

Development Business Analysis

Launch / Commercialization

Market Testing

Post-Launch Monitoring

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Now lets deep dive into each of the stages

Identify product’s focus and unique selling points, approach and guidelines

New Product Strategy Development

Purpose of the stage Marketing Methods

Use members from different company departments and levels

Idea Generation

Screening and Evaluation

Business Analysis

Development

Market Testing

Launch / Commercialization

Post-Launch Monitoring

Brainstorm concepts for potential products / services

Ideas from R&D, employees, competitors and focus groups

Eliminate bad ideas and focus on strong products

Identify screening criteria and key performance indicators

Analyze the products features, marketing strategy and financial plans

Create marketing plan consider 4Ps Financial, legal & economic state

Create prototype product to understand all intricacies

Laboratory tests Consumer tests

Pilot product and marketing in the market on a small scale

Simulation testing Test small market samples

Position product in marketplace Product Positioning Potential for Regional Growth

Monitor progress and identify possible areas for improvement and growth

Gather Customer Feedback Create Surveys

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Idea Generation

Suppliers & Distributors

• Go up and down the value-chain to recognize spaces to capture

Internal Resources

• Use resources within the company to identify and generate ideas and leads

Competitors

• Analyze existing landscape to identify gaps that can be filled

Customers

• Ask the client!• Customers are the

closest to their needs

Idea Generation

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Screening and Evaluation

Eliminate bad ideas and focus on good ones based on the criteria below

Scalability Product Price Development Duration Cost to Develop Return on Investment

Screen & Evaluate

Proceed with Products that pass criteria

Eliminate Products that do not pass criteria

No Go Go

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Business Analysis

Business Analysis

Marketing Strategy Financials

Legal and Competitive landscape Macro-Economic conditions

Make financial plan and projections for product / service

Analyze investment needed and available sources for funding

Check overall economic conditions

– Political Risks– Employment– Currency Risks

Are there more opportunities or threats in the current economic status

Are there legal barriers to entry Do competitors have any edge Test for available similar products

or substitutes

Create full marketing plan Think through all 4Ps

– Product– Price– Promotion– Place

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Development

Idea Physical Product / Service

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Market Testing

Standard Test Market

• All-out marketing campaign

• Small geo coverage

Controlled Test Market

• Agree with specific outlets to carry new product

• Negotiate an agreement

Simulated Test Market

• Try on small sample size of consumers in a simulated environment or test group

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Commercialize and Launch!

This is the phase in which you must build and create demand for the new product or service offering Allocate resources and spending according to plan to get new product to market

Revenue

GrowthEntry Mature Time

Initiate Product Life Cycle

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THANK YOUNo. 4, Street 151, Floor 12

Maadi, Cairo, Egypt

+20 2 2750 9088

b2b@darendeal.com

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