Lesson 5: Innovation and new Product Development

• Innovation triggers.

• Market demand dynamics and innovation challenges

• Innovation adoption and diffusion within markets

• Innovation strategies

• Key success factors and pitfalls to avoid

Why Innovate ?

• Growth and profitability

• Changing patterns of needs

• Exploiting marketing opportunities

• Shortening technology and PLC

• Stretch and leverage core competencies

• Discruptive technologies

Demand and opportunities

• Existing demand

• Latent demand

• Incipient demand

Innovation adoption and diffusion

• Innovators

• Early adopters

• Early majority

• Late majority

• Laggads

• (refer to diagram of Page 8,9 and 10)

Innovation strategies

• create new positioning propositions

• create new distribution channels

• create new market segments

• seek process breakthroughs

• develop and launch new products

‘No innovation’ - alternatives

• cost reduction

• repositioning

• improvement

• line extensions

• new to the world products

The Innovation process

New product development process

• The new product development process consists of seven steps. These are;– new product strategy

– exploration

– screening

– business analysis

– development

– test-marketing

– commercialisation

• The new product development process can take anywhere from a number of months to a number of years.

NPD process

Failures of innovation

Building an innovation culture

Lesson 6: Pricing

• Theory and practice of pricing .

• Pricing objectives

• Pricing methods: cost-based, value/utility, economic value to customer and competive pricing.

• Challenges and opportunities in new product pricing

• Price adjustments and responding to changes in competitors’ price

Assignment B

Lesson 7:Advertising

• The promotion mix. • The communication process and developing

an effective communication strategy. • Deciding the communication budget and

selecting the communication mix. • Developing the advertising plan. • Determinants of an effective plan. • Measuring advertising effectiveness.

The communication process model

The communications process

• Communication is an exchange process in which thoughts or ideas are exchanged.

• Promotion is the means by which organisations communicate with their target markets.

• The process includes a sender, who encodes a message which is sent through a message channel to a receiver who decodes the message and then provides feedback to the sender.

Figure 17.1

Advertising planning

• How advertising works

• see figure 7.1 (page 7)

Developing the advertising plan

Kotler’s 5-step process

• Objective setting

• Budget decision

• message decision

• media decision

• campaign evaluation

• See figure 7.2 (page 9)

Other points

• Experimentation and Test Marketing budgeting approaches

• Evaluation and control

• Measuring advertising effectiveness

Lesson 8: Sales Promotion, Direct Marketing and Public Relations

• Management of sales promotion.

• The available techniques, and limitations of techniques.

• Setting clear objectives and measurement of promotion effectiveness.

What is Sales Promotion

• Sales promotion: Targets and modes

• Role of Sales Promotion

• Growing importance of sales promotion

• Benefits and Limitation of sales promotion

• Major decisions in sales promotion

What objectives

• Consumer objectives

• Intermediary / dealer objectives

• Sales force objective

• Review Promotional vehicles

• Building the promotional programme and pre-testing

• Evaluation

Direct Marketing

• Growth in Direct Response maketing

Different methods of direct marketing

• The most common methods are;– database marketing

– direct-selling

– direct-mail marketing

– catalogue selling

– telemarketing and call centres

– direct-response advertising

– electronic home shopping.

Publicity and public relations

Publicity

• Publicity is managed by the public relations department of a firm.

• It is non-personal stimulation of demand for goods, services or business units by generating commercially significant news about them in the mass media, or by obtaining favourable presentation of them on radio, television or any other media.

ASSIGNMENT C

•

Lesson 9: Personal Selling

• Role of personal selling.

• Salesforce tasks.

• Selling tasks.

• A conceptual model of the sales process.

• Steps in the selling process.

Lesson 10:Distribution Channels

• Strategic role of distribution.

• Alternative distribution strategies.

• Factors affecting channel strategy.

• Key considerations in channel selection and management.