New Product Development

(NPD)
The 4 Elements of The Marketing Mix
Product Price Place Promotion
Marketing Mix

Defining Product
Anything that you can sell
Two forces for NPD
Consumer
needs
Technological
advances
When the
two align,
you have a
winner!
Three keys to NPD
1. Recognize when you are in an NPD
situation
2. Understand that therell be many ideas,
and a few winners.
3. Tolerate a portfolio of products
A few (only a few) high risk products
And some no-brainers (with low payoff)
The 8-Stage New Product
Development (NPD) Process
New Product Development
(NPD)
1. Idea Generation & 2. Idea Screening
Generation: Firms are always on the look-
out
Screening:
Fit with manufacturing and
distribution expertise
Feasibility
3. Concept Screening
Prototype or storyboard
Focus group: Would you be interested
in a service that . . .
Approximation of willingness to pay

4. Marketing Strategy Development and 5.
Business Analysis
Marketing strategy:
Developing credible marketing plans
with positioning, target and
Marketing Mix
Business analysis:
Is there a high chance of a good
payoff?
6. Product Development
E.g. battery life in iPod
7. Market Testing
Some firms (fashion goods) dont test the
market: Put it out there, see if people buy it
(the costs of this must be small)
= Market test by roll out
Simulated test market (dummy store) new
product is mixed in with familiars
Test markets: Several cities let us tweak the
Marketing Mix but rivals may attempt
disruption
8. Possible roll-out strategies
during commercialization
By geography
By market size
By customer type
(business/consumer/government)
By channel of distribution (Rx/OTC)
By use (special occasion/every day)
By benefit sought
Most New Products Fail?
Consumer packaged goods fail most often
Brand extensions not sought by
consumer (new colors, flavors,
packaging)
Products that attempt to meet a need
that few consumer have (e.g.
combination products)
Product Manager
What Does A Product
Manager Actually Do?
Product Management is a strategic and business-oriented role,
focused on delivering solutions to market needs.
Product Managers...
Identify profitable opportunities that meet market needs
Launch products into the market
Oversee products already in the
market
Wind down products that no longer meet market needs
Communicates with customers & prospective customers
Conducts usability tests
Surveys
Keeps an ongoing record of compliments/complaints
Actually uses the product regularly
Research, research, research
Is aware of, and understands, the competition...
... but is not just slavishly copying their feature sets
Creates Relevant, Usable
Documentation
BRD: Business Requirements Document - Identifies
business problems, solutions
MRD: Market Requirements Document - Functional,
non-functional requirements
PRD: Product Requirements Document - Feature
details, user interface, flow
FSD: Functional Specifications Document -
Engineers, screen by screen
Note: Not every company uses these acronyms--or
docs--in the same way!
Your job is to meet market demands and actually
make it to market
But understand the importance of not falling behind
the curve
Timing is crucial
Realize that pioneering doesnt always pay
Face to face
Email
Blog
Telephone
Social networks
Clear, not jargon
Concise, not convoluted
Confident, not weasel words
Courteous
Completely understands the
issue
The Means... The 5-C Method...
Sales
Marketing Communications
Engineering
Design
Customer Service
QA
Operations
Manages the brand
Generates sales leads
Responsible for the profit & loss of the product
Brings new products to life... maximizes profits in existing
products... winds down unsuccessful products
Champions the product, internally and externally
How To Be A Good Product Manager:
http://www.goodproductmanager.com
Pragmatic Marketing:
http://www.pragmaticmarketing.com
All Top Product Management:
http://product-management.alltop.com
The Cranky Product Manager:
http://crankypm.com
On Product Management:
http://onproductmanagement.wordpress.com