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Ibrahim Odufisan

New Product Development 2

1. Flaw 1 the company cant support fast growth: This flaw can also be referred to as the failure to adequately prepare for market response to new product launch/development What causes the problem? This problem is mostly caused by lack involvement of customers and sales team. Most of the time during new product launch, customers and sales team are not always aligned or held accountable in the launch process. Effective communication with internal and external customer bases is a key consideration which is often over looked. The sales team are the closest to the customer; companies cannot prepare their sales forces well when they have not consulted with them before hand to find out customer customers reaction at every stage of the product launch and development. Which tool might have prevented this failure/flaw? Stage 1 process of BASES 2 which involved shopping mall interview done at four or more geographically dispersed cities would enable a company to adequately assess the needs and want of the customer. How can it be avoided? This failure can be avoided by the company by making strong commitment to greater communication, full involvement of customers and sales forces very early in the new product launch process. What can be done to avoid failure/flaw? Opinion of customer must be considered throughout all the stages of the go to market of the new product. They can do this through the traditional customer research or focus group or

less traditionally which serve to generate customer involvement and excitement for the launch. 2. Flaw 2 the product falls short of claims and gets bashed: This flaw may also be called failure to meet market expectations. What causes the problem? This is simply a case of the product now meeting the expectations of consumers and they subsequently refuses to repurchase the product. This could either be due to improper communication of what the product can do or over-hyping of the product. Which tool might have prevented this failure/flaw? Using ASSESSOR a company can simulate a test market procedure of customers from the target population are exposed to advertising for the new brand through the folder method. In the process, the respondents are ask to shop at mock store set up where the new brand and its competitors are available. The respondent are later called to repeat purchase. The trial and repeat process are estimated to measure awareness and availability. How can it be avoided? The predictive and diagnostics abilities of these models, their timeliness and relatively low cost will enable a company to avoid this failure. What can be done to avoid failure/flaw? This flaw can be avoided by a customer expectation management which would help a company to identify and define customer expectations. Once set the company must ensure they meet these without exception. Customer expectation management shows how customer expectations exist in every customer touch point. CEM helps businesses create repeatable processes that align a business with its customers success. Meeting customer expectations without exception impacts the business by, expanding the customer base, reducing customer attrition and increasing profit per customer by extending the customer life-cycle duration.

3. Flaw 3 the new item exists in product limbo: This flaw can also be called failure of improper product differentiation What causes the problem? Packaging, after-service, sales team, channel, and image are the various ways to differentiate a product or an offering and to make it stand away from the clutter. When a company goes to market without proper differentiation, it leaves customers with no option than to abandon the product. Which tool might have prevented this failure/flaw? Using the information system, a company can identify problems and opportunities by using the system to create a sales forecast. Then assess the alternative courses of action by forecasting sales of alternative mixes of decision variables. Finally, the information system can assist in delimiting and clarifying the nature of the problem or opportunity by using the system for diagnostics purposes. This will ensure a well thought out product development which will be properly differentiated to meet the customers needs. How can it be avoided? This failure is mostly caused by copy-cat syndrome. The product gets initiated as soon as a successful competitive product is observed. The strategy here is to avoid risk by developing a product, which is similar to its competitor or the leader, with a belief that mere presence would bring in fair share of sales. A company should be original 4. Flaw 4 the product defines a new category and requires substantial consumer education - but doesnt get it: This can also be referred to as failure of not creating sufficient consumer education for the new product What causes the problem?

Customers are averse to change; they would demand two to four times more benefits to give up a product in their possession than they were willing to pay to obtain the new product in the first place. In addition, customers irrationally overvalue goods in their possession over products that are not in their possession. We do this all the time, we are attached to offering in our possession over new product, and only early adopters are most willing to experiment with new offerings. Which tool might have prevented this failure/flaw? The BASES 2 tool started with an assumption that customers are unaware of the new product and started its demand forecasting from unaware aware trial repeat. The awareness campaign should be allowed to run throughout the product launch process. How can it be avoided? Integrated marketing communications (IMC) is very important for a successful product launch in your new products. It involves the consistent communications of information about a product using communications channels, sources and programs so that consumers get an effective message at the lowest cost. Channel examples include salespeople, advertising, public relations, sales promotions and publicity. 5. Flaw 5 the product is revolutionary, but there is no market for it: It can also be called failure of lack of available market for the new product. What causes the problem? A company may have a good or breakthrough product, there is the impulse to produce, commercialize the product and rush to market as quickly as possible. However, if the product functionality, distribution or marketing have not been completed, rushing to market may significantly affect the products success. Which tool might have prevented this failure/flaw?

The three tools under consideration should be used to simulate market conditions before an innovation product which will significantly change the market is launched. How can it be avoided? There is a thin line between precision marketing, sales and distribution. A company should follow specific process for positioning product, training the sales force, working with the channel partners and communicating with customers. These steps are executed with long term growth objective (that is the desired end result in mind). The company deliberately plan for low adoption of the new product and manage their resources over that projected time frame. What can be done to avoid failure/flaw? The more closely a company follow the process for planning, executing and monitoring a products introduction to the market, the greater the chances of successful product launch.