Marketing
Chapter 10
Developing New Products
Gilbert A. Churchill, Jr.
Irwin/McGraw-Hill
J. Paul Peter
© The McGraw-Hill Companies, Inc., 1998
Slide
10-1
Figure
10.1
Types of New Products
New-to-the-World
Products
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
10-2
Figure
10.2
The New Product Development Process
Idea Generation
Idea Screening
Business Analysis
Product Development
Test Marketing
Commercialization
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
10-3a
Table
10.1
Techniques for Generating Ideas
Technique
Delphi Method
Benefit Analysis
Description
A panel of experts fills out a questionnaire; a researcher
tabulates the results and sends them to panel members.
Repeat the process until the panel reaches a consensus or
an impasse.
List all the benefits customers receive from the product
under study. Think of benefits that are currently missing
from the list.
Use Analysis
Ask customers how they use the product under study. List
the various uses.
Relative Brand
Profile
Ask target markets whether the brand name makes sense
for other product categories under consideration. A stretch
of the brand name that makes sense to potential buyers
can be the basis for a new product.
Unique
properties
List all the properties held in common by a product or
material currently on the market. Look for unique properties
of the organization’s product.
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
10-3b
Table
10.1
Techniques for Generating Ideas
Technique
Description
Achilles heel
List the weaknesses of a product or product line (for the
organization and its competitors). Prune the list to the one
or two weaknesses most likely to inspire a response from
competitors. Identify product concepts that could result from
correcting these weaknesses.
Free
Association
Write down one aspect of the product situation–a product
attribute, use or user. Let the mind roam and jot down every
idea that surfaces. Repeat the process for other aspects of
the product situation.
Stereotype
activity
Ask, “How would ________do it?” –referring to how a
member of some group or a particular person would use
the product. Example: What type of bicycle would a senator
ride? Can also ask what the stereotype would not do.
Study of other
people’s failures
Study products that have failed. Look for ways to solve the
problems that led to failure.
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
10-4
Types of Test Markets
• A standard test market is the practice of offering a
new product through normal distribution channels
in a limited area.
• A controlled test market is the practice of offering a
new product through a set of retailers who have
been paid to set aside shelf space for the product in
a desirable area of the store.
• A simulated test market is an experiment in which a
sample of consumers has an opportunity to select
products.
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
10-5
The Eight Dimensions of Quality
Walt Disney World
Performance
Perceived
Quality
Singapore
Airlines
Overall
Evaluation
Ralph Lauren
Features
Reliability
Aesthetics
Serviceability
Midas
Sears Die Hard
Durability
Conformance
DuraCell
Chrysler
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998
Slide
10-6
Universal Product Codes
0 12345 67890 5
Check Digit
Identify Manufacturer
Assigned by the
Uniform Code Council
Irwin/McGraw-Hill
Identify Product
Assigned by the
Manufacturer
© The McGraw-Hill Companies, Inc., 1998
Slide
10-7
Figure
10.5
Organizational Forms for
New Product Development
Options
Functional
Functional
Matrix
Balanced
Matrix
With or
Without
Committee
Project
Matrix
Venture
Inside/
Outside
Percentage of Employee Time Devoted to the New Product
Almost None
Source: Adapted from C. Merle Crawford, New Products Management, 4th ed.
(Burr Ridge, Ill.:Irwin, 1994), p. 411
Almost All
Slide
10-8
Shortening Development Time
• Use cross-functional teams
• Applying technology
• Delegate authority
• Build on specialized knowledge
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 1998