Question

1. a) Describe the new products process and point out why each component is important. b) Discuss how to develop a good quality PIC.

Answer 1

1)
A new product refers to product improvements,original products or modifications to existing products.
As defined by Philip Kotler, a new product development undergoes the following process
a) Idea generation
It is the systemic search for new-product ideas. Ideas can be generated from both internal as well as external sources. Internal sources are companies R & D programme and external sources are customers, competitors, market etc.
b) idea screening
This phase involves identifying and accepting new ideas and dropping the poor ideas. This is a very important phase because, accepting bad ideas and rejecting good ones could spell doom on the company.
c) Concept development and testing
A product concept is the detailed version of the idea stated. It also involves releasing beta version.
Concept testing refers to the testing of new-products among a sample of target consumers.
The main advantage of this process is that any flaws in the idea or the test product can be noticed early on and course correction can be done, before the product is launched.
d) Marketing strategy development
This phase involves the intial marketing startegy to introduce product. It also involves Selecting target market,offering Value proposition( Price, offers, discounts etc), Sales goal.
This is also a very important phase because, if a good product is not marketed correctly ,the chances of failure is quite high.
e) Business analysis
It involves the review of sales, cost, marketing effectiveness etc
f) Product development
It involves the creation and testing of one or more physical version of the product.
All the inputs that are gathered in the above steps are considered for the development of the product.
g) Test marketing
The product is released in a more realistic environment. It allows the company to test the marketing programme before full introduction to the market. The various types of test markets are Standard test markets, controlled test markets and simulated test markets.
h) commercialization
Commercialization is the introduction of the new product that is when to launch the product, where to launch etc.

All the components are important because each step adds value to the next step. Only when all the phases are excuted successfully can a new product be launched.

2)

The product innovation charter ( PIC) is the primary document for a organized effort to introduce a new product. It contains the reason, goals,objectives, etc of the project.
A good quality PIC can be developed by the adapting the below steps
a) Key points from PEST(political, economic,social, technology), SWOT analysis should form the base of a PIC. Questions such as the what is the business about , stratergy etc should be addressed.
b) PIC should contain a road-map i;e timeline and goals from idea generation to commercialization
c) PIC should include the core competencies and how best these competencies can be alligened to innovate.
d) The short term and long term goals of the company should be clearly mentioned, so that it acts as a benchmark.

e) The PIC should not be ambiguous. The ideas and language should be clearly stated.