npd plc strategies

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Copyright © 2005 Pearson Education Inc. New Product Development and Product Life-Cycle Strategies Principles of Marketing

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principal of markiting topic is Npd Plc Strategies

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PowerPoint PresentationNew Product Development and
Learning Objectives
Explain how companies find and develop new-product ideas
List and define the steps in the new-product development process
Describe the stages of the product life cycle
Describe how marketing strategies change during the product’s life cycle
Prof. Jahanzaib Yousaf
Prof. Jahanzaib Yousaf
Types of New Products
Imitative
Major Stages in New Product Development
Idea generation: systematic search for new ideas
Internal sources: brainstorming
Idea screening: identify good ideas and drop poor ones
Usefulness to consumers
Good for company
Have the resources
Major Stages in New Product Development
Concept development: detailed version of the product concept in meaningful consumer terms
Concept testing: testing new-product concepts for consumer appeal
Marketing strategy: initial strategy for product concept:
Target market, positioning, and sales, market share, and profit goals
Price, distribution, and marketing budget
Strategy statement, long-run sales, profit goals, and marketing mix
Figure 11.1
Major Stages in New Product Development
Business analysis: review of sales, costs, and profit projections to determine if they meet company objectives.
Product development: developing the product concept into a physical product
Large investment
Figure 11.1
Major Stages in New Product Development
Test marketing: testing the product in more realistic market settings
Determine the target market profile
Assess consumer acceptability, trial, repeat purchase rate
Evaluate trade reception and distribution penetration
Design effective media plans
Test marketing
Major Stages in New Product Development
Commercialization: introducing a new product into the market
Introduction timing
Sequential product development
Product Life-Cycle Strategies
Product life cycle (PLC): the course of a product’s sales and profits over its life
Figure 11.2
Prof. Jahanzaib Yousaf
Product Life-Cycle Strategies
Slow sales growth
Introduction Stage
Prof. Jahanzaib Yousaf
Product Life-Cycle Strategies
Price stability or decline to increase volume
Profits increase
Growth Stage
Prof. Jahanzaib Yousaf
Product Life-Cycle Strategies
Slowdown in sales
Increased promotion and R&D to support sales and profits
Increased Variants
Maturity Stage
Prof. Jahanzaib Yousaf
Product Life-Cycle Strategies
Prof. Jahanzaib Yousaf
Product Life-Cycle Strategies
Cost cuts
Styles, Fashions, and Fads
Fashion: currently accepted or popular style in a given field
Fad: a fashion the enters quickly, adopted with great zeal, peaks early, and decline very fast
Figure 11.3
Prof. Jahanzaib Yousaf
Prof. Jahanzaib Yousaf
ProfitsNegativeRising profitsHigh profitsDeclining profits
awareness and trialsharedefend market share& milk brand
Strategies:
extensions, servicemodelsitems
marketbest competitors
distributiondistributionintensive distributionunprofitable outlets
early adopters/dealersinterest mass marketand benefitsto retain hard-core loyals
Sales promotionHeavy sales promotionReduce promotion dueIncrease to encourageReduce to minimal
to entice trialto heavy demandbrand switchinglevel