INTRODUCING NEW MARKET

OFFERINGS
Existing products

New products
 Managing existing products
• Line extension
• Product modifications
– Functional modifications
– Auality modifications
– Aesthetic modifications
 New product
Idea generation screening Concept testing

Product
Test marketing Business analysis
development

commercialization
 Categories of New Products
➢ New-to-the-world
Ex : Voice activated home assistants

➢ New product lines

Ex : Smoothies by Epigama
 Cont…
➢ Additions to product lines
Ex : Additional flavours to Maggi Noodles line

➢ Improvements to products
Ex : Intel Processor- generational improvement
 Cont…
➢ Repositionings
Ex : Gillette

➢ Cost reductions
Ex : Markdown in prices of smartphones
NEW PRODUCT DEVELOPMENT
PROCESS
 VARIATIONS OF FAILURE

➢ ABSOLUTE PRODUCT FAILURE

➢ PARTIAL PRODUCT FAILURE
➢ RELATIVE PRODUCT FAILURE.
CONCEPTS IN CONCEPT DEVELOPMENT

• Product idea
• Product concept
• Category concept
• Brand concept.
• Concept testing.
 CONCEPT TESTING

• Communicability and
believability
• Need level
• Gap level
• Perceived value
• Purchase intention
• User targets, purchase
occasions, purchasing
frequency
 Preliminary steps of a Marketing Strategy:
1. Target market’s size 2. Planned price
• Structure
• Behaviour ● Distribution
● Promotion for 1
year

3. Long run sales

● Profit goals
● Marketing mix
● Strategy over time
 Prototype Testing
Developing a prototype of your product allows you
to bring your product to life for the first time and
test it in its market.
Three types of prototype testing
1. Alpha testing- within the firm
2. Beta testing- with the customers
3. Market testing- give information about buyers,
dealers and market potential
 Timing of Market Entry
First entry
The first firm entering a market usually
enjoy the “first mover advantage”
Parallel entry
The firm might time its entry to coincide
with the competitor’s entry.
Late entry
The firm might delay its launch until after
the competitor had borne the cost of
educating the market.
20-15
Consumer-Adoption Process

“Adoption is an individual’s decision

to become a regular user
of a product”
Stages in the Adoption Process
▪ Awareness
▪ Interest
▪ Evaluation
▪ Trial
▪ Adoption
Awareness
Consumer become aware of the new product,
but lacks information about it.

Interest
Consumer seek information about new product.
Evaluation
Consumer consider whether trying new product
make sense.

Trial
Consumer tries new product on a small scale to
improve his or her estimate of its new value.

Adoption
Consumer decides to make full and regular use of
the new product.
 Adopter Categorization

▪ Innovators
▪ Early adopters
▪ Early majority
▪ Late majority
▪ Laggards
 Types of Adopters
Innovators
Venturesome people and risk takers who are
the very first users.
Early adopters
Prestige oriented opinion leaders, savvy and
accepting of new material
Early majority
The leading segment of the mass market. Who
adopt the new technology when its benefits
are proven and a lot of adoption has already
taken place.
 Types of Adopters (Contd.)
Late majority
Skeptical conservatives who are risk averse,
technology shy, and price sensitive.
Laggards
Conservative, tradition bound and resist the
innovation until the status is no longer
defensible.
Characteristics of an Innovation

• Relative advantage
• Compatibility
• Complexity
• Trial ability
• Observability
Characteristics of an Innovation (Explained)
Relative advantage
The perception that the innovation is more
satisfactory than items that already exist in the
same class of product.
Compatibility
Is an estimate of harmony between the innovation
and the values and norms of potential adopters.
Complexity
Is a gauge of the difficulty faced by a customer
in understanding and using the innovation.
Trial ability
The relative ease of testing out the innovation before
making a decision.
Observability
The degree of visibility afforded by innovation.
 New Products
Failure and Success
 Reasons for Failure
• Unable to reach the market.
• Some new products are not capable enough
to survive due to the competition.
• Lack of proper market research.
• Faulty product idea
• Distribution related problems
 Succeeds because of:-
• Proper knowledge about the competitor’s
upcoming products or services.
• A unique and superior idea.
• Proper market research.
• A product only succeeds only when there is
net benefit to the user.
• When the demand is fulfilled.