4.

0 NEW PRODUCT DEVELOPMENT

4.1 Definition
New product development is defined as the process by which entrepreneur designs and
creates new product or service that will be sold to the customers. The importance of new
product development is survival and strategy for growth. Companies that are able to develop
and introduce new and improve product will have a different advantage to compete. As
competition has become more intense due to technological product become more complex
and the technological product life cycle getting shorter, companies faced threat of losing
customers and clients when competitors come up with their new products. Therefore,
companies have to develop new product to ensure survival in the market.

Development of new product enables business to growth by introducing new product to the
existing market. By introducing new product, it can be a strategy to compete with the
competitors to continuously growing in the market. NPD fulfils customers’ requirements by
exploiting available technologies and have a firm relationship with supplier to cater a
problem and learn from the competitors to upgrade a product. Henceforth, every company
needs to engage with NPD in order to tune with the need of the community and to keep
surviving.
4.2 Classification of NPD

New product development can be classified into two types. The first is completely new
product and the second one is the improvements on existing products. The writers classify the
Smart Cart by using a built-in image recognition and card swiper for groceries stores as the
completely new product.

Inside the types there are two different categories for new products and four different
categories for existing products.

1. Completely original or new products.

- Completely original or new products can be explained in terms which it is broken

down into ‘New to the world’ or ‘New to the firm’ product. It is mean that the ‘New
to the world’ product is a new product that may enter the market, while ‘New to the
firm’ product means that the product is not new to the world, but it is new to the firm.

2. Existing products that have been modified and improved.

For existing products that have been modified and improved, there four different
categories under it which are additions to existing product lines, improvements or
revisions to existing products, repositioning and cost reductions;

i. Additions to existing product lines is a simple line extension, designed to flesh

out the product line as offered to the firm’s current markets. For example,
Maggi comes out with sauces products beside its usual product which is
instant noodle.

ii. Improvements or revisions to existing product line is when the firm

improvised their current products to make it better. For example, Maggi make
a new flavor of their instant noodle such as curry and chicken.

iii. Repositioning are products that are retargeted for a new use or application
such as baking soda which can be used for baking cake and can be used as
drain and refrigerator deodorant.
 iv. Cost reductions refer to new products that simply replace existing products in
the line, providing the customer similar performance but at a lower cost.

4.3 New Product Development Process

4.3.1 Research & Development

The definition of research and development is the systematic activity

combining both basic and applied research to discover and find a solution the
problems or creating new good and knowledge (BusinessDictionary.com, 2017). The
research and development (R&D) process are done for the ideation stage through idea
generation, idea screening and market survey.

1. Idea Generation

Idea can be tangible where something can touch or see or intangible that is
something symbolic. According to Study.com (2017), idea generation is the creative
process or procedure that a company uses in order to figure out solutions to any
number of difficult challenges. The idea is generating based on the idea screening and
trends nowadays. Next, the idea then should be discussing, select and implement the
best idea to give the solution for the problem that occurs in the organization.

The idea search and generation process are the first stage in this process. Ideas are
generated to solve a problem arise, or to meet some demand and need. Currently, the
problem that we perceive is supermarkets nowadays experience long queues while
shoppers conduct transactions during the peak of shopping period. These long queues
have resulted in the loss of time both for the shoppers and the mall attendants.
Therefore, we want to design and develop an Intelligent Smart Shopping Cart with the
sole objectives of minimizing shopping time and to maximize shopping experience in
a supermarket. We name it as Smart Roller painting
 2. Idea Screening

Idea screening is a process used to evaluate innovation product idea, strategies and
marketing trends (BusinessDictionary.com, 2017). In another term idea screening is a
technique to evaluate ideas to drop as many as possible. For this project, the process
of idea screening is to do internet survey or browsing on the company that develop a
smart cart. There are several companies that use smart cart can be compared such as
IBM Builds High-Tech, SK Telecom and V-mark.

IBM Builds High-Tech

Figure 4: The logo of IBM

The smart carts, from IBM, feature on-board IBM touchscreen computers that
double as personal assistants when the laser scanner on the cart reads an individual
shopper's loyalty card. The card can call up the shopper's homemade grocery list, e-
mailed into the store's database before her minivan ever left her driveway and linked
to her through her loyalty card account. The scanner allows the cart-pusher to keep a
running total of her purchases and loyalty program benefits as she moves through the
supermarket.
 Figure 2: Example
of IBM’s smart shopping cart

The smart shopping cart will alert customers to promotions and personalized
discounts on preferred brands as they walk the store aisles, too. The Stop & Shop
Shopping Buddy, as the IBM/Cuesol Cart Companion is called by the supermarket
company, aims to support efficient supply chain and inventory management while
providing personalized attention and convenience that no other technology has
delivered.

SK Telecom

Figure 3: Logo of SK Telecom

 SK Telecom (NYSE: SKM) announced the launch of a pilot test for Smart
Cart in Korea with E-Mart, the nation’s largest retail chain. The test, conducted to
make the service stronger by identifying areas of further improvement, takes place at
the E-Mart store located in Seongsu-dong, Seoul.

Figure 4: A user is
purchase item by using a phone

Smart Cart is an innovative service that uses a smartphone and a smart

shopping cart equipped with tablet PC to offer diverse shopping-related information
based on accurate indoor positioning technology. After downloading the Smart Cart
application to their smartphones, customers can search for shopping/discount
information, store coupons and draw up a shopping list. Then at supermarkets or retail
stores, the customer’s smartphone is synchronized with a tablet PC installed to a smart
shopping cart through user authentication. Within the stores, depending on their
location, customers can get useful information – e.g. catalogue, product information,
discount information, etc. – and receive coupons using augmented reality technology.
At the checkout counter, the tablet screen shows the list of purchased items,
membership points and available coupons.
 V-Mark

Figure 5: Logo of V-Mark

V-Mark started to design and build digital scales, force meters, digital gauges,
and other outdoor products with advanced technology and greater processing
performance. The Intelligent Shopping Cart (ISC) can instantly determine the weight
of items with high precision and accuracy. The ISC connects to the ZigBee network to
send information on the weights of the items to handheld scanners and central
controllers. Using this information, the system can tell if the items placed in the
shopping cart correspond to what the shopper inputs into a handheld scanner,
facilitating the collection of shopping data as well as improving the efficiency and
security of intelligent shopping.
Figure 6: Example of V-Mark’s smart shopping cart