Hierarchy Of New Product Development Strategy

A Literature on New Product Development Models and Factors for Success in NPD

Discuss About The Hierarchy New Product Development Strategy.

This report critically analysis the new product and services development models and components that support in the success of NPD. It also discusses the how the organization could develop new products and services in the marketplace. In last, it presents the recommendation that could be effective to improve the development of new goods and services process.

Critical analysis of new product (or service) development models for NPD success

BAH model considers seven factors that are considered in the new product development process like product strategy, idea generation, screening, Business analysis, testing, development, testing, and commercialization (Aya?, 2016).   

Initially, Organization could use new product strategy about the new products and services. In this, an organization can make a plan about goods and services as it could be effective for the success of NPD. 

The idea generation could be imperative for sorts the ideas about new products and services. The idea could be originated from anywhere as it could be sort and numerous. This stage considers the higher amount of ideas from many sources like SWOT analysis, market research, internal sources, customers, and competition (Roberts, Darler, 2017). A large number of organizations provide rewards for their employee to produce new product ideas. The company could review their strength, weakness, opportunity, and threats to attain the feasible idea. Moreover, an organization could continually review the need, trends, and desires of consumers of the marketplace. In addition, it is also found that feedback from employees could support the organization to improve their goods and services. However, SWOT assessment of competitors could also support for the organization to create an effective idea.                

An organization could create several ideas but the effective idea could be few. In this, the organization could address effective idea about product and services and eliminate infeasible information. There are certain components that could be involved in the idea screening like company strength and weaknesses, consumer need, affordability, and ROI trends (Cui and Wu, 2017).             

In this stage, the organization could focus on the new product development concept and testing. A product concept is based on the comprehensive approach. If the idea is developed in each stage then it could be presentable. It is identified as the concept. Each idea that is passed from the screening stages is changed into the concept for the purpose testing. The concept is carried out to the targeted marketplace. For evaluating the concept, some consumers are selected from the specified targeted group. Investigator offered the information to the consumers imagine (Yuen, 2014).

New Product Strategy

The testing outcome assists business to develop a new concept about goods and services. The firm has developed the concepts by evaluating and selecting marketing and other business approaches that could be used. Moreover, identified product efficiency is forecast by branding approaches and marketing mix for developing new goods and services. In this procedure, there are different factors that could be involved by the company like rivalry of the product, pricing strategy, cost, and breakeven point (Kiss and  Barr, 2017).  

The product concept is altered into real considerable goods and services. The result of new goods development stage is to create the prototype and specified production model. In this stage, each approach could be tested before implementing into the business process.      

The recent feedback and prototype could be developed for research rather than concentrating on the testing concept. The consumer feedback is collected and makes and modification if needed with respect to developing new products and services. The process is imperative as it validates whole ideas and creates the company for product launching.           

In this stage, products and services are ready for the marketing. The marketing mix is implied in this phase to product launch. The last decision is made in this phase to develop new goods and services. In this stage, organization marketers are decided to produce or launch new product and services. This stage discusses different departments that are associated with duties and targets. In this phase, the small and major result is created before last introduction phase of the new goods and services development (Leenders, and Dolfsma, 2016).    

There are certain factors that are considered in the success of NPD. It is discussed as below:

This component is significant to investigate the market with respect to determine the consumer preference and needs. It contributes to developing the profitable goods and services situation as it could also be imperative for getting higher success. There are different tools to evaluate the desires of consumers like customer surveys, test product, data pooling and sample marketing. This technique is supportive to product and service design (Hirunyawipada, Paswan, and Blankson, 2015).

Evaluation of needs of consumers does not take assurance to get higher success. There is the gap in the business functions of marketing as it would develop the difficulty to create the products and services. Marketing is essential to comprehend the needs of consumers and techniques for getting higher market advantages. Product and service qualities are required by the consumers as it would be involved in product developing. It is also evaluated that when early adopters buy bad goods and services then they could dissatisfy expectation and needs of consumers. Consequently, it will decline the image of the organization in the marketplace.  

Idea Generation

Quality goods could not be imperative for the new product development success. The organization could make a unique image in the market position by differentiate the products and services features in the marketplace. In addition, if a large number of companies offer same product and services to the consumers then it could be difficult for the company to attract the consumers to consume company’s products and services. Hence, the organization should promote their goods and services and make distinguish image in the consumer’s mind as it would be effective for obtaining higher success (Leenders, and Dolfsma, 2016).            

Promotion is the key component of the product marketing success as it could be managed by marketing acts. It considers many ways to promote their products like sales efforts, public relations, paid to advertise, and free media exposure. The organization should select an appropriate technique to make a link among targeted consumers and creating the message as it would support to select appropriate social media to make a connection with specified consumers and creating the message as it would appeal to the consumers in a significant way. It is imperative components to obtain higher success in the new product and development. Ineffective promotion could lead to the marketing failure even with the product quality. Advertising is an effective technique for developing the attractive message that promotes to take desired advantages from the targeted market (Kiss and  Barr, 2017).                    

Detailed analysis of the organization’s new product development practices and detail areas of strength and weakness
Cole’s supermarket applies different practices of new product development in order to develop the product. The below practices are implemented by Coles Supermarket:  

This is an initial phase where Cole’s supermarket acquires the information regarding the new product. This company generates the idea about a new product by using certain sources like employees, suppliers, business customers, competitors, journals, and newspaper. It also implemented technology-based idea generation technique. This phase is vital as it provides the foundation for all another stage, as well as ideas creation, leads the whole process of developing the products (Wowak, Craighead, Ketchen, and Hult, 2016).

The pooled ideas go through the screening process to select the one appropriate solution. Cole’s supermarket collects the opinion of workforces, customers, and other business to avoid the chase of costly inappropriate ideas. The external environmental factor may influence the Coles supermarket such as competition, advancement in technology, and alterations in decision criteria of business. A company enables to get viable ideas from a large number of gathered information at the end of the screening process (Marion, Eddleston, Friar, and Deeds, 2015).

Idea Screening

Cole’s supermarket conduct research to analyze the prospect cost, revenues as well as productivity created from the product.  It also conducts SWOT analysis to assess the strength, weakness, threats, and opportunity in the market. The market strategy is also practiced by Cole’s supermarket to evaluate the target group of product. It uses segmentation of product to categories the market. Market segmentation is significant as it enables the company to analyze its niche market. The identified niche market could affect the marketing judgment of company (Tinoco, and Ambrose, 2017).;

Product development entails the development of the product as well as the actual design of the product. Development starts with the prototype building that is used in market testing. On the basis of the obtained result of the test, Coles supermarket decides that whether it should perform large-scale manufacturing or not. There is a requirement for high-scale commercialization and production to obtain a favorable result. Cole’s supermarket initiates their promotion campaign for building new products. Market research is conducted during conception stage in order to decide the location and selects the timing for launching the product (Genç, and Di Benedetto, 2015).

Cole’s supermarket executes new product development approach to eliminate the wasting time, money as well as resources. This approach facilitates the corporation to manage the planning and research of product, address the opinions of customers and expectations and viable plan as well as resources of new product development project. This strategy helps to avoid the overvaluing and misunderstanding of the target market. The company has developed a poorly intended product that does not complete the need of the identified customer. It also utilizes the resources for declining the expected development expenses. Cole’s supermarket also detects their business uncertainties from unanticipated competitors (Fuller, 2016).  Below are certain practices that are used by Cole’s supermarket to develop the new product strategy:       

Cole’s supermarket builds plan regarding feasible product description. It would support them as well as their team member for emphasizing on eliminating the pitfalls of new product development and develop a large number of products at once. It also obtains optimum utilization of material to produce the products (Du, Yalcinkaya, and Bstieler, 2016). 

Cole’s supermarket targeted the marker and also addresses the needs and wants of customers to develop the new products. A purposeful, targeted and strategic strategy of NPD makes sure that product fits into the marketplace. A company primarily targets the market for the product by addressing the needs of the market. It also focuses on advantageous of the potential new product. Cole’s supermarket also identifies the responses of customers with regards to current product and its type. It also determines the approaches to sustain into the market. It evaluates the distinctiveness of products rather than key market players. Cole’s supermarket determines the existing market research and conducts additional research to evaluate the proposal of a new product with potential customers (Rubera, Chandrasekaran, and Ordanini, 2016). For example, a corporation determines a focus group as well as conducts the survey of the customer to identify their needs and wants.

The corporation facilitates sufficient time to generate the ideas and implements the new product. The key purpose of Coles supermarket is to build the new products and makes time structure and the deadline for completing the project. But, time structure should be thoughtful and realistic (Luzzini, Amann, Caniato, Essig, and Ronchi, 2015). In such case, the below objective would be practiced:

• To compete for the market and improves the efficiency of the team members
• To accomplish the particular launch date and persuades the demand for calendar events as well as seasonal products
• To be responsive with regards to customer’s need and gain demand by making sure the appropriate product at the particular time
• To run the business by keeping the schedules for resources and NPD

Cole’s supermarket emphasizes on several tasks to build the product that is appropriate for customers. The nature of the company and their idea will analyze the phases of building the new product (Fang, Lee, and Yang, 2015). The company formulates the stage for the success of new product development. These stages are:   

• Generating and screening of ideas
• Developing and screening concepts
• Testing concepts
• Determining market as well as business strategy
• Developing and market testing products
• Implementing and commercialization of products

A new product strategy should be implemented by Cole’s supermarket through focus groups, beta tests as well as phone surveys. In such condition, it is evaluated that focus group is a tool by which top executive of the company will observe customer via the one-way channel. An interviewer will examine the question with the consumer regarding product like suggestions, likes and dislikes about the product. This information is evaluated later to build the concept of product (Chaudhuri and Boer, 2016). Cole’s supermarket can exercise the phone survey to build the reliable sample with regards to the need of market regarding the product. A large number of survey demonstrates the feelings of the general population about products. If market research is favorable then the next phase will be a beta test in order to launch the product into the market. By using the beta test, Coles supermarket can allocate and promote the products and services in the different market. After that, it will shift the product at national and regional level (Vickery, Koufteros, Dröge, and Calantone, 2016).   

Cole’s supermarket should exercise price-skimming strategy in order to enhance their practices of a new product. This approach could help to reduce the high production costs about the development of new product. The appropriate timing of using this approach is that when the demand for the product is inelastic. An inelastic demand demonstrates that customers do not price sensitive. For illustration, a customer may not emphasize on the rate of the new product. Cole’s supermarket should also apply the penetration pricing for enhancing their new product development activities and offering minimum price in order to develop rapid customer basis at the marketplace (Tuli, and Shankar, 2015). Once Coles supermarket pull the attention of customers then it could send them a regular promotion for retaining them. As a result, it could be effective to develop brand loyalty.

Cole’s supermarket should organize the product lifecycle to enhance the practices of new product development. In such way, it could entail management of product by using distinct stage of the product lifecycle. A product has several stages of introduction, growth, maturity as well as decline. Under the introduction as well as growth stage, a company should trade their new products. The barriers could create when market players will enter into the market at the maturity phase. A company should differentiate its product with the new features as well as offer lower rates to increase their revenues and profits (Gmelin, and Seuring, 2014). The key intention of product lifecycle management is to obtain higher return by using the new technology.

Cole’s supermarket could build product concept for enhancing the practices of NPD. In such way, a corporation could organize a meeting for all departments in order to spread awareness about the new product ideas. It could be a compliment for a current product line of the corporation.  In this process, the decision maker will formulate the outline of the product like product range, dimension, and characteristics. Marketing research manager should emphasize on the industry research information that explains the strength of key competitors and their products (Homburg, Alavi, Rajab, and Wieseke, 2017).

Cole’s supermarket could make the approaches by hiring workforces for creating new product and service. In the new product development, the organization requires making stable team structure in which the member could easily modify as the needed disciplines. Targeted goods can need special plan and engineering knowledge to transfer consistent employees to change the corresponding employees into the liable team for goods and services. Consequently, it might need marketing input and employees who have marketing knowledge to make a part of the team. This team could play an imperative role in the different location of the business. It can also support to strategies for the business process (Guo, Zheng, An, and Peng, 2017).  

Conclusion

On behalf of the above interpretation, it can be summarized that BAH model is used to effectively create new product and services in the marketplace. This model considers different stages like product strategy, screening and evaluation, testing, development, business analysis, idea generation, and commercialization. It can also be examined that many components are considered in the new product development like Product Benefits, Marketplace Need, Effective Promotion, and Clear Differentiation. It can also be concluded that Cole’s supermarket uses several product development practices. In this, many practices are considered like Idea Generation, Concept Development, Product Development, Screening, New and product development strategy, and Commercialization. It can also be summarized that Cole’s supermarket could imply the pricing strategies to create the new product and services. Apart from this, it can also be concluded that higher rivalry could directly create new product and services. In addition, it can also be examined that organization could use many strategies for success of NPD. These approaches are Pricing Product, Product Life Cycle Management, Product Concept, Marketing Research, and New Product as a Project, Differentiation, Diversification, and Develop New Products in Teams.

Product Development

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