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 Why is NPD (New Product Development)
important?

 Types of Products

 Stages in NPD

 Managing the Product Life Cycle

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 Product is a good, service, or idea
consisting of a bundle of tangible and
intangible attributes that satisfies
consumers and is received in exchange
for money or some other unit of value.

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 Augmented
Augmented Product
Product
Installation

Packaging
Brand Features
Name
Delivery Core
Core After-
Benefit
Benefit Sale
& Credit
Service
Quality Styling

Warranty
Actual
ActualProduct
Product Core
CoreProduct
Product
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 PRODUCT MIX

Product Line A Product Line B Product Line C

Product Item A1 Product Item A2 Product Item A3

SKU SKU SKU Stock Keeping Units, Distinct UPCs

SKU SKU Slide:

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 Product Line: a group of closely related
products that satisfy a class of needs, used
together, sold to the same customer group,
distributed through the same type of outlets,
or fall within a given price range.
Product Line Length

Product Line Width

Product Line Depth

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 Product Mix
Product Line Depth

Product Line Length

(total # of products in line)

Product Line Width

© 2009 – 2010 8
Vignesh
 Type of User
 Consumer Goods
 Business Goods

 Degree of Tangibility
 Durable Goods (e.g.home appliances)
 Non-durables (e.g. Grocery items)
 Services (e.g. Utilities)

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Consumer Goods
 Convenience – frequent; minimum effort
 Shopping – Compare several alternatives
 Specialty – special effort to find and buy
 Unsought – does not know or initially
want
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 BA 3365 – Slide:
PRINCIPLES OF
MARKETING © 11
VIGNESH 2006
Products that serve unarticulated needs
◦ Needs that consumers do not realize
◦ Needs that consumers cannot express in a
coherent way

Ways to view the newness of a product

◦ Newness compared with existing products
◦ Newness in legal terms: up to 6 months after
regular distribution
◦ Newness from the company’s perspective
◦ Newness from the consumer’s perspective

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• Continuous Innovation

• Dynamically Continuous Innovation

• Discontinuous Innovation

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 Insignificant “point of difference”
Incomplete initial market and product
definition
Too little market attractiveness
Poor execution of the marketing mix
Poor product quality
Bad timing
Expensive access to buyers

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 BA 3365 – Slide:
PRINCIPLES OF
MARKETING © 16
VIGNESH 2006
+ =

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 Test Marketing
 Simulated (or Laboratory) Test Markets (STM)

“A test market is a city that is viewed as

being representative of U.S. consumers in
terms of demographics and brand
purchase behaviors, is far enough from
big markets to allow low-cost advertising,
and has tracking systems to measure
sales.”
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 Critical and often most expensive phase in NPD
process

 Commercialization involves positioning and

launching a new product in full-scale production
and sales and is the most expensive stage for
most new products.

 Complexities:
◦ Slotting Fee
◦ Failure Fee

 Speed of Commercialization:
◦ Time to Market (TTM)
◦ Fast Prototyping
◦ Parallel Development

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 Contact

amit@hand2handsolutions.in
09818995422
New Delhi,NCR,Gurgaon

www.hand2handsolutions.in

Knowledge. Experience. Results