Product development takes place, works or functions as under:

1. Creation of an entirely new product or upgrading an existing product by

exploring all possibilities and outcomes.
2. Innovation of a new or an existing product to deliver better and enanced
services to end!users.
". Continuous improvement of a new product or enancing an existing
product by giving preference to satisfy te demand of end!users.
#. $nancing te utility of a new product or upgrading features of an existing
product, for te personal and%or commercial use, to expand te defined goal
&ob'ective(.
Product development involves risk of investing precious time, money &capital(
and intellectual resources. )erefore, it is necessary tat it is well!planned.
* good product development elps to:
1. Create new business opportunities and bring growt.
2. +oost productivity and profitability of te entrepreneurs.
". $nance te satisfaction levels of te consumers.
PRODUCT INTRODUCTION or product launch
Product introduction is a business process through which a new product is launched,
debuted or published in the market for general users and or businesses.
For example, a software development company may introduce a new product
through a beta version before launching the complete solution. This allows the
company to gain valuable user feedback, and to fix bugs and errors before the
complete launch.
The growth stage is the period during which the product eventually and
increasingly gains acceptance among consumers, the industry, and the wider
general public. During this stage, the product or the innovation becomes accepted
in the market, and as a result sales and revenues start to increase Figure 1. Profits
begin to be generated, though the break even point is likely to remain unbreached
for a significant time--even until the next stage, depending on the cost and revenue
structures.
Features of the growth stage:
Costs reduced due to economies of scale: as production and distribution
are ramped up, economies of scale kick in and reduce the per unit costs.
Sales volume increases significantly: as the product increases in
popularity, sales volumes increase.
Profitability begins to rise: revenues begin to exceed costs, creating
profit for the company
Public awareness increases: through increased promotion, visibility
and word of mouth, public awareness grows.
Competition begins to increase with a few new players in establishing
market
ncreased competition leads to price decreases: price wars may erupt,
technology may get cheaper, or other factors can ultimately lead to falling
prices.
!"#$%#&
As the company will attempt to prolong the maturity phase as long as possible, it
will likely introduce alterations and innovations to the product to keep customers
interested and stay a step ahead of the competition.
Advances in technology and changes in consumer taste and demand may also add
to the slowing down of sales growth of the product during this phase.
Prices tend to drop in this phase due to lower costs as well as a high level of
competition, and so industrial profits will fall as well.
#he stage that lasts the longest in the product life cycle is the !aturity stage. t is at
this time that repeat business and purchases take the place of new customer buying.
he decline stage of the product life cycle is the one where the product ultimately
!dies! due to the low or negative growth rate in sales "see Figure #$.
Profitability will fall, eventually to the point where it is no longer profitable to
produce, and production will stop. %s a number of companies start to dominate the
market, it becomes increasingly difficult for the company in &uestion to maintain
its level of sales. 'onsumer tastes also change, as do new technologies which may
make the product become ultimately obsolete "as in the case of 'Ds and D(Ds,
and now )lu-*ay$.
#he PC was state'of'the'art technology in ())*. +nly technologically'advanced
individuals would buy one at the very steep price of ,(-.. /and bear in mind, ,(-.. in
())* was worth a lot more than it is today0. " large number of companies were
competing in the field. "s the market grew, businesses learned to be more efficient in
producing the PC and prices came down. #he drop in prices and improvements in
technology made PCs more attractive to other consumers. 1owever, the market
became saturated after *... and went into decline. PCs started to become obsolete as
laptops, net books, tablets, and smart phones started to enter the market, shifting the
emphasis from power to portability. #he PC is still used all over the world, but its
popularity has declined dramatically.
Line extension
A line extension is a product that incorporates a slight twist on an established brand. It utilizes the
older brands na!e and i!ager"# and is usuall" in the sa!e general product categor". $ore than
%& percent o' all new product launches each "ear are 'or line extensions that si!pl" ha(e a new
'la(or# size or nutritional content# according to Iowa )tate Uni(ersit". In the 'ood and be(erage
industr"# 'or exa!ple# !an" line extensions are si!pl" diet# organic# whole grain or gluten*'ree
(ersions o' the original brand or are si!pl" new 'la(ors.
Brand Extension
Like line extensions, brand extensions also utilize an existing brands name and imagery. What makes
them different is that they sit in a completely different product category. Companies ith ell!established
brands that ha"e solid consumer loyalty often use brand extension tactics, such as #tarbucks ith its
$%%& launch of a premium ice cream line and 'odaks foray into batteries. (n order for a brand extension
to be successful, it must be distinctly different from the parent brand, but related enough so that
consumers are not confused. Brand extensions that ere confusing for the consumer, and ultimately
failed, include B(Cs perfume and pantyhose, Colgates frozen foods and )rito!Lays lemonade drink.
*hese extensions might ha"e had a better chance of success if they had been launched under a ne
brand name, although it ould ha"e cost the manufacturer significantly more money.
benefits
While a ne brand ould re+uire a great deal of aareness ad"ertising and marketing to
de"elop recognition and consumer perception, a brand extension has aareness and
recognition built in. (n other ords, a familiar brand name instantly communicates messages to
consumers based on the existing brand promise.
, ell!planned and ell!executed brand extension can benefit from hats knon as the halo
effect herein the established brand promise and brand image of the parent brand carries o"er
to the brand extension automatically. *his positions the brand extension for greater and faster
success than an entirely ne brand.
Brand extensions can also benefit the parent brand by creating a greater sense of loyalty,
reaffirming the brand promise and consumer perceptions of the brand, and sustaining the parent
brands rele"ance in its existing category. Extensions can also help to establish a brands
position in ne categories.
-isks
a poorly executed brand extension can tarnish the parent brands image, and a brand extension
into a category that doesnt fit appropriately ith the original brand promise can confuse e"en
the most loyal consumers causing them to sitch to brands that do meet their expectations