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Objectives Challenges in New Product Development (NPD) Organizational Structure NPD Stages Management of NPD Diffusion Adaption of New Products Why New Products Fail “Over Championing” Overestimated Demand Poor Design Poor Marketing Execution High Development Costs Strong Competitive Reaction Challenges in NPD Idea Shortage Fragmented Markets Social Governmental Constraints Cost Capital Shortage Need for Speed Shorter Product Life Cycles New Product Development Process Probability of Success Concept Development Testing Product Brand Positioning Conjoint Analysis Consumer-Goods Market Testing Commercialization Adopter Categorization of the Basis of Relative Time of Adoption of Innovations Characteristics of the Innovation Rate of Adoption Relative advantage Compatibility Complexity Divisibility Communicability Review Challenges in New Product Development (NPD) Organizational Structure NPD Stages Management of NPD Diffusion Adaption of New Products * ?2000 Prentice Hall * Idea Generation Concept Development and Testing Marketing Strategy Development Idea Screening Business Analysis Product Development Market Testing Commercialization Probability of technical completion Overall probability of success = Probability of commercialization given technical completion X Probability of economic success given commercialization X 1. Develop Product Ideas into Alternative Product Concepts 2. Concept Testing - Test the Product Concepts with Groups of Target Customers 3. Choose the Best One High price/oz. Low in calories Low price/oz. High in calories (a) Product-positioning map (breakfast market) Expensive Slow Inexpensive Quick Bacon and eggs Pancakes Instant breakfast Cold cereal Hot cereal b) Brand-positioning map (instant breakfast market) Brand C Brand B Brand A Brand name -- -- -- -- -- Utility 1.0 0 ||| K2R Glory Bissell Retail Price Utility -- -- -- -- -- 1.0 0 ||| $1.19 $1.39 $1.59 Good Housekeeping Seal? Utility 1.0 -- -- -- -- -- 0 || N
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