Question

Why does an organization tackle stage four in the product development process, business case analysis? To weed out potentially expensive failed products To be sure a product will bring enough financial returns to justify its significant development costs To evaluate the product launch and generate a new cycle of product idea generation

Answer 1

To be sure a product will bring enough financial returns to justify its significant development costs.

In the business development process, the stage of business case analysis is for putting together the whole business case needs and evaluating if the product will be profitable for the company. This evaluation will be done by considering the marketing strategy, marketing mix, the target market and product positioning strategies that will be used. The questions that will be addressed in this stage are identifying the marketing opportunities for the product, the cost of introducing the product to the market, the cost at each stage of the product lifecycle, the positioning of the product in the product portfolio and its impact on the existing product sales, impact of the product on the brand and impact of the product on the corporate objectives. Hence the business analysis case not only identifies the costs and the budgets of the product development but also the revenues and business impacts of the product.