1 Introducing New

Market Offerings

Arnold A. Tolentino

7 February 2014

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5 Things to Know in Introducing

New Market Offerings

1

Challenges

2

Organizational structures

& processes

3

Stages in Development

4

Best ways to manage NPD

5

Consumer Adoption

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Continuous Innovation

to seize new market opportunities and

to create new choices

New Product Success

Unique, superior product

Well-defined product concept

Produce locally, think globally

New Product Failure

Accept as part of the “game” to be

successful

Challenges

5 Types of New Products

1

New to the World

2

Additions

3

Improvements

4

Repositioning

5

Cost reductions

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Organizational Structures for the

Development Process

New Product

Management

Budget R & D

Marketing

SVP – Product

Development

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What is a Venture Team?

A venture team is a cross-

functional group charged with

developing a specific product or

business; intrapreneurs are

relieved of other duties and

provided a budget and time

frame.

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Criteria for Staffing Venture

Teams

Desired team leadership

style

Desired level of leader

expertise

Team member skills and

expertise

Level of interest in concept

Potential for personal

reward

Diversity of team members

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New-Product Development

Decision Process

DROP

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1

Idea

Genera-

tion

Is it worth

considering

?

2

Idea

Screen-

ing

Is it

compatible

with

corporate

objectives?

3

Concept

Dev’t &

Testing

Can we find

a good

concept

consumers

say they

would try?

4

Mktg

Strat

Dev’t

Can we find

a cost-

effective,

affordable

mktg

strategy?

5

B’ness

Analysis

Will this

product

meet our

businesss

goals?

Y Y Y Y Y

N N N N N

New-Product Development

Decision Process

DROP

ONE

6

Prod

Dev’t

Have we

got a

technically

and

c’mercially

sound

product?

7

Market

Testing

Have

product

sales met

xpectations

?

8

Commer

cializa-

tion

Are product

sales

meeting

xpectations

?

Y Y Y Lay

Future

Plans

Send it

back for

prod dev’t?

Modify the

prod or

mktg

program?

Y

Y

New-Product Development

Decision Process

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Stages in Managing the

Development Process

1

Ideas

2

Concept to Strategy

3

Development to

Commercialization

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Ideas : 10 Ways to Find Them

1. Run informal sessions

2. Technical people to putter on pet projects

3. Customer brainstorming as part of plant tours

4. Survey your customers

5. Undertake “fly on the wall” research

6. Use iterative rounds with customers

7. Do keyword search to scan trade publications

8. Treat trade shows as intelligence missions

9. Have employees visit supplier labs

10. Set up an idea vault

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Ideas : How to Obtain from

Customers

Observe how they use the product

Ask about their problems with the

products

Ask about their dream products

Use advisory board or a brand

community of enthusiasts to

discuss product

Challenge them to change or

improve your product

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Concept Testing

Communicability and

believability

Need level

Gap level

Perceived value

Purchase intention

User targets,

purchase occasions,

purchasing frequency

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Marketing Strategy

First Stage:

Target market’s size,

structure, and behavior

Second Stage:

Planned price, distribution,

and promotion for year one

Third Stage:

Long-run sales and profit

goals and marketing-mix

strategy over time

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Test Market Decisions

Select test cities

Which cities

Length of test

What information to

collect

What action to take

What is Adoption?

Adoption is an individual’s decision to

become a regular user of a product.

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5 Stages in the Adoption

Process

Awareness (aware but lacks info)

Interest (seek info)

Evaluation (consider to try product)

Trial (try to improve his estimate of its value)

Adoption (decide as regular user)

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In Summary Company, to be competitive,

must welcome all ideas for

consideration to develop

appropriate new products;

New products to be developed

must passed series of processes

and rigid market tests; the

challenge is on marketeer’s

ability to ensure product

adoption;

The consumer-adoption process

may be influenced by many

factors beyond marketeer’s

control, including consumers

willingness to try new products.

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