...New Product Development Why is it importand to launch a new product? * A successful new product does more for an organization than any other thing can do * Today a high percentage of sales and profits come from new products (> 30% avg) * The process is extremely difficult * Companies take big risks * Failure rate is quite high (40% avg) * It is fun and exciting! A product can be tangible = Goods A product can be intangible = Services B2B =Business to Business BSC =Consumer Products * New product process does not usually start with a new product idea: it begins with an amount of Strategy * Marketing does not start when the procut is finished: it often starts before ideation * The process is not over when the product is launched=It ends when the new products is successful * Very few are taken to launch and only a small fraction succeed: high risks! * Most new ideas are epresed as lie extensions of existing brands= Parent Brands awareness+values * Most new ideas....are not that new: what’s new for you may not be new for consumers Opportunity An opportunity is a business or technology gap that a company or individual realizes that exists between the current situation and an envisioned future in ordert o capture competitive advantage, respond to a threat, solve a problem or ameliorate a difficulty A Strategy: It is necessary, because it ist he foundation for a new product management A new product development...
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...situation? Saxonville Sausage company is currently loosing it market share on its various leading product lines produced except for one Italian sausage brand namely Vivio. However Vivio represents 5% of the company's total revenues. A new marketing director, in the company is currently in the process of undergoing a research to identify opportunities and possible market expansion strategy. The research result ended up with two marketing concepts that are almost equally viable and thereby put the management team in a dilemma on which of this two option to consider. TOWS matrix strenght weakness- Entire family enjoys the product - Weak brand name ( Vivio )- Rivals offer frozen sausage - Consumed rarely on special occasion- Easy to cook and quick - Niche segment on the northeast - Meal maker Threat Opportunity - cannibalisation - many local rivals ? | * The TOWS matrix helps us identify the possible opportunities embedded in this market. When cross analyzing strength, weakness and opportunity we can understand that the company finds itself with the following opportunities. * Product share is growing * Repositioning Vivio * Expand territory * leverage on existing channel...
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...Clean Edge Razor: Splitting Hairs in Product Positioning On August 9, 2010, a group of executives from Paramount Health and Beauty Company (Paramount) sat in a research room intently observing a dozen men shaving on the other side of a two-way mirror. The subjects were testing out Paramount's newest nondisposable razor, Clean Edge, and discussing the experience. The verdict was extremely encouraging. The majority of men felt it was the closest, cleanest, and smoothest shave they had encountered. Clean Edge's improved design provided superior performance by utilizing a vibrating technology to stimulate hair follicles and lift the hair from the skin, allowing for a more thorough shave.1 Jackson Randall, product manager for Clean Edge, sat in the darkened observation room considering the positioning strategy for this new product. He had led the new product development process and was now grappling with how to position the product for the upcoming launch. All executives at Paramount agreed Clean Edge should be priced in the super-premium segment of the market. However, some executives believed Clean Edge should be launched as a mainstream entry within that segment, with the broad appeal of being the most effective razor available on the market. Others felt a more differentiated niche strategy, targeting the most intensely involved super-premium consumers, would be optimal. Paramount had decided to launch this technologically advanced product-into the men's market first where...
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...preferred corporate citizen, preferred employer, preferred supplier selling preferred products. Bru : Happiness Begins with Bru Brand : Bru Company : Hindustan Unilever Agency : O & M Brand Analysis Count : 359 Bru is a power brand from the HUL's stable. A brand which pioneered the instant coffee category in Indian market in 1969 is also an example of many successful marketingpractices. According to HUL, Bru is the market leader in coffee segment with a value share of 46.9 %. Prior to 2004, HUL had many brands in the coffee category. It had Deluxe Green Label and Bru instant as the main brands and small brands like Dilkush, Cafe and Cafe Gold. In 2004, as a part of the power brand strategy, HLL decided to phase out Dilkush and Cafe brands . It then consolidated the coffee brands under the masterbrand Bru. Bru before becoming the family brand was positioned as a coffee that tasted just like filter coffee. But after the elevation to master brand, Bru took the positioning around happiness. Bru was synonymous for instant coffee and had an astounding 21% market share in the first year of launch itself. All these years, the brand has been fighting for the numero uno position with Nestle whose iconic Nescafe brand was the market leader. But in 2008, the brand pushed Nescafe to the second position. Much of the success of Bru can be attributed to following factors Innovation in new...
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...and challenges are key to the success of the new product line? Andrea Torres should concentrate on marketing issues that is positioning, size, and packaging. The quality of the product which indicated health benefits as a potential strong basis for positioning over state. Perception consumers should have of Montreaux chocolate USA versus its primary competitors. Credibility issues because of the brand name. Some consumers preferred the smaller squares for portion control while others preferred 3.5 ounce candy bar and NDP needed to choose one size over the other. They should also focus on testing the market having in mind that their competitors are also moving fast. I feel that the above issues are of major concern because in every business the consumer is the main target and their demands need to be addressed to retain them in future. They should be very cautious on the quality of their product to ensure that they give the best to their customers and a thorough test of the new product should be done before it is released for sale. 2. Evaluate the achievability of the company objectives for Montreaux USA. Identify the most salient aspects of the chocolate confectionery industry, globally and domestically, that bear on a new product introduction. Provide support for your conclusions. The chocolate is made by roasting, crushing and refining cocoa beans. Dark chocolate is typically at least 55% cocoa. High quality products contain a at least 75%.milk chocolate contains...
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...Focusing on the bottle design, Absolut Vodka launched their world famous advertising campaign, using the distinct differences combined with humor to reach out to their clients. Through joint direct sales activities in targeted bars and restaurants (strongly focussed on the “hot spots” within a city) Absolut quickly became renowned as hip brand in this community. Their sales force used high rotation in their sales visits with attractive promotional concepts and incentives, in order to tie in the bartender community into their image statement. Through time Absolut Vodka achieved the status of a lifestyle product, to the extent that it became a brand statement as such, with people ordering “Absolut and Tonic”. Originality combined with consistency in marketing were key elements in the achieved success, leading to repeated two-digit increases in sales, year after year and positioning Absolut as the 5th largest selling spirit brand in the world. In the past few years V&S Absolut Spirits has experienced a strong increase in demand from, among other places, the quickly growing Global Travel Retail market, which, combined, is the second biggest market for ABSOLUT VODKA. Background --: The name "Absolut" was introduced in 1879 by the entrepreneur Lars Olsson Smith. Smith introduced fractional distillation that produces liquor without fusel alcohol in Sweden. In 1917 the Swedish government monopolized the alcohol industry in Sweden. Vodka was then sold nationwide under the name...
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...and New Product Development Winter 2015 Draft Syllabus January 2015 Instructor: Farhad D. Rostamian, PhD., MBA Office and Office Hours: By arrangement Teaching Assistant: TBD E-mail: fdrostamian@gmail.com Messages: Valerie Myers, (310) 206-3011, vmyers@anderson.ucla.edu Enrollment: Open enrollment. Time: Wednesdays, 4 to 7 PM First Class meets: Wednesday, January 7 Room: Anderson Complex, Cornell Hall, D-307 Course Description New products are the lifeblood of any corporation and the cornerstone of any economy. Without expanding the product portfolio, any modern corporation can quickly succumb to competition and lose significant market share, or even be totally dis-intermediated. This phenomenon has been intensified with the advancements in digital economy. The innovation process has been significantly altered as a result of the impact of digital economy across all industries and markets. While most companies recognize the need for new products, not all such new products that are introduced to the market are successful. And even a smaller percentage can stand the test of time and reach significant market share or achieve resilient popularity. Innovation is one of the key drivers of making new products. We will examine the process of innovation and new product development and discuss the associated paradigms and success factors (through the case and class discussions). This course is designed to help students deepen their understanding of new product ...
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...Technovation, 25, pp.171-183. In the introduction, the authors point out the important role of innovation in organizations and argue that innovative organizations generally possess innovation capability which can be managed. The authors then discuss in detail the four types of innovation capability (4Ps framework) and the challenges they may bring. Cases are cited to illustrate how those enterprises managed innovation capability and cope with challenges. The 4Ps framework works well in ‘steady state’ context, under which the aim of enterprise is ‘do better’. However, when discontinuity comes into play, the ‘do better’ innovation strategy is not sufficient as demonstrated by the fact that incumbent firms tend to be outperformed and thus displaced by new entrepreneurial players. Therefore, a ‘do different’ innovation strategy must be pursued by enterprises who want to explore ‘outside the box’. The authors develop an ‘innovation agenda’ covering the entire spread of 4Ps in two dimensions, ‘do better’ and ‘do different’. Managers are encouraged to specify their innovation agenda in the form of diamond diagram, including all possible innovation activities. The 4Ps model was tested through a preliminary study in an effort to assess whether this model provided a useful heuristic device capable of being used by managers. The result that 60 percent of the total initiatives are ‘do different’ innovations suggests that this type of innovation strategy needs higher level of top management involvement...
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...Creating new products Our objective is to be the voice of the consumers within the organization. High-quality market research has helped secure the long-term future of the business. Analyzing and understanding the data gathered on consumers' behaviors, needs, attitudes and opinions minimizes the risks involved in making marketing decisions. They help the central research team in gathering and interpreting consumer views. These views provide information or insights that ultimately result in the development of new products suitable for a global market. This case study follows the development of a new Disney cosmetics called young beauty aimed for kids, from both boys and girls. This case study will give you a clear picture of how market research has helped New Product Development (NPD). The New product Mainly this product is offered for the kids to have them start using cosmetics like their parents, both boys and girls like to imitate their parents in even small things, and thus Disney thought in pitching the market with this product and the idea was to have a safe product for the kids skins that gives the same look of the adults without affecting them negatively Market research should start with the consumer and serves two purposes: 1) To inform companies about consumer needs and desires. What are the trends in the market? What do consumers want? 2) To give consumers the opportunity to talk to the providers of products and services so that their views are taken...
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...marketing research. 100 bottlers who sell to retailers- in store displays, campaigning. Merchandising and sales. Key success factor, without them the concentrate producers cant get their product to the supermarkets. Owned by either the producers which is verticle integration or franchises. Retailer outlets- supermarket, fountain, convenience stores, small retail outlets (independent Grocery store) II. industry economics Concentrate producers should sell more regular because they have higher sales with regular over diet. Cost them less to produce as well. III. Brand & category Over 900 registered brands in the market. Top 10 brands make up 71.4% market share all sold by coke, Pepsi, dr. pepper, and none of them sell orange drinks. Growth share matrix- current product, current market (market penetration such as arm and hammer) & new product, current market (new product development) if you have current product in a different market you have new market expansion and new product new market then that is market diversification. Soft drink category- diet vs. regular, & flavors (lemon lime etc.) IV. Porters 5 forces Barriers to entry - high Substitute products- high Seller power-low because rivalry is very intense, substitute products are high and product life cycle is mature so the only way to grow is to steal from other competitors Buyers power- high V. BUYERS BEHAVIOR- sold regionally not nationally because so many consumers have preference...
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...2014 Art of the Start Quiz Positioning is the focus of chapter two in Art of the Start, by Guy Kawasaki. All new companies need to great positioning to be successful and develop their brand. The startup that I believe created successful positioning is called, Plated. Plated is a New York City based startup formed in 2012 by Josh Hix and Nick Taranto. Plated is a website where users can see different recipes from chefs around the world. If there is a recipe that you like, you can can request the dish, then Plated sends you exactly every ingredient you need. This tackles the common issue of buying too much or not enough of an ingredient when preparing a meal. This startup also allows users to try a variety of dishes that they may have not heard of. Plated was also featured on this past season of ABC’s Shark Tank in efforts to raise more money to branch out into the mid-west and west coast. My girlfriend Tammy and I frequently use Plated to make meals, and as a customer I have always been satisfied. The best thing about Plated is that they send you all the ingredients, measured out perfectly, all you do is follow the recipe instructions. Also, if they send you meat or fish, they make sure to place it in an ice pack bag to keep it fresh. When I first heard about Plated I realized that they have made their service for people who don’t have time to make meals and for people who don’t have cooking experience in general. This is a “specific” positioning technique as mentioned by Kawasaki...
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...unveiled what he called “New Management” a top-to-bottom strategy for the entire company. The goal of the new management was to make Samsung become a premier band that would dethrone Sony as the biggest consumer electronics firm in the world. The first step that Samsung took to become cutting edge product leader was new product development which was defined by Kotler and Armstrong as development of product, product improvement, product medication and new brand through the firm product development. Samsung implemented this by hiring a new group of young designers who creates sleek, bold, innovative and stylish product targeting high-end users. They then went a step further by Product testing Marketing which is also defined by Kolter and Armstrong whereby every product had to pass the “WOW” test, if it did not get a “WOOW” reaction during the market testing, it went back to the design studio making Samsung conduct integrated test of product and its entire marketing program-targeting and positioning strategy, advertising, distribution, pricing, branding and packaging and budget levels providing management the information needed to make a final decision about whether to launch the new product or going back to the studio. With the use of Positioning Commerzials Samsung abandoned low-end distributers and they decided to choose to work with specialty retailer such as Best Buy and Circuit City. 2. I believed Samsung process all these three approach since the new management is a top-to-bottom...
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...to go from copycat brand to product leader? Samsung started out as a maker of cheap consumer electronic knock-offs. CEO Lee Kun-hee has taken major strides to make Samsung the company it is today. In 1993, Lee unveiled what he called the “new management,” which was a top-to-bottom strategy for the entire company. Under Lee’s new management, he took Samsung Electronics in a very ambitious new direction. His goal was to make Samsung become a premiere brand that would dethrone Sony as the biggest consumer electronics firm in the world. Instead of being a copycat, Samsung was to become a cutting-edge product leader. As part of Samsung’s revamped strategy and positioning, along with developing stylish and innovative new products, the company altered distribution to match. Samsung quickly abandoned low-end distributors such as Walmart and Kmart and built strong relationships with specialty retailers such as Best Buy. 2] Is Samsung’s product development process customer-centered? Team-based? Systematic? Customer-centered new-product development focuses on finding new ways to solve customer problems and to create more customer satisfying experiences. Samsung uses the product development process by using market testing. Samsung created the “Wow!” test which every new product had to pass. If the product did not pass the “Wow!” test it went straight back to the design studio. Team-based new-product development is an approach in developing new products in which various company departments...
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...Background With over $35 billion in revenues in 2011 and a growth rate of 2.8%, the confectionery industry in the U.S was an attractive market, and chocolate, comprising almost half the market at $17.6 billion, held some promise for new entrants. Apollo Foods, a California-based, global confectionery producer, acquired the well-known Swiss Montreaux Chocolate Company with the intention to expand its number-two position in the global confectionery business by launching a new product in the U.S. market. This venture would become Montreaux Chocolate USA, with new product development headed by Andrea Torres. While ambitious, Apollo aimed to achieve national distribution, $115 million in annual sales, and a 0.6% market share with their new product by 2015. In order to achieve their objectives, Apollo would have to gain greater penetration into the chocolate industry, a diverse and mature global industry. One of the greatest distinctions within the industry was between dark and milk chocolate. Globally, darker chocolates with higher concentrations of cocoa were perceived to have greater health benefits, and the U.S market was especially honing in on fitness and health in their consumption habits. The U.S. market was fragmented into multiple segments, with the largest being chocolates sold in bars/bags/boxes greater than 3.5oz at $7.149 billion in revenue in 2011. Moreover, convenience plays a huge role in purchasing decisions, as mass market chocolate dominates with 80% total market...
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...and challenges are key to the success of the new product line? The major challenges: 1) Market Research: When the product is launched, at its inception stage the most important aspect in which every company should put in their focus is market research. Initially the company had chosen 20 people for one concept.. Considering the magnitude of the potential production this number is too low for a sample size which is the basis of any form of market research. It is important that we select the sample size for testing the product diligently after considering the fact that it would be a fair representation of the target population. The percentage of cocoa which was initially agreed by the sample size was 90 % but they wanted to test a new product with less percentage of cocoa (70%). This step could have been implemented when they were conducting market research. 2) Positioning: Positioning is the process by which one product acquires space in the minds of the consumer. Apollo should target the minds of the consumer based on the various analysis which are as follows: a) Population is changing its preferences towards healthy products. b) Women’s association being stronger and intense with chocolates and their ability to perceive the difference between premium and non- premium chocolate then men. c) Men preferred these aspects of chocolate-energy boosters, quick, easy, convenient and affordable. d) Adults preferred snack size product with o.25-0.60 ounces e) Dark chocolates...
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