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STRATEGIES FOR NEW
PRODUCT DEVELOPMENT
(AGENDA ITEM 5)
DECISION EXPECTED
TAKE NOTE OF THE PAPER.
34th PAPU Administrative Council
24 May – 3 June, 2015, Khartoum, Sudan
PAPU/AC/QIBD/MWG/2015 - Doc N°
I. Introduction
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
In business, New Product Development (NPD)
is the complete process of bringing a new
product to market or to improve an already
established product. New Product Development
can therefore be described as the
transformation of a market opportunity into a
product available for sale and it can be
tangible (that is, something physical you can
touch) or intangible (like a service, experience,
or belief).
II. Success Factors
For the success of a new product, a good
understanding of the following factors is a necessity:
 customer needs and wants,
 the competitive environment and
 the nature of the market
Cost, time and quality are the main variables that drive
the customer needs. Aimed at these three variables,
companies develop continuous practices and strategies
to better satisfy the customer requirements and increase
their market share by development of new products.
III. Product Development strategy
What is it about?
Developing new products;
 Modifying existing products so they appear new and
 Offering those products to current or new customers.
With a well-considered New Product Development
(NPD) strategy, you can avoid wasting time, money and
business resources.
An NPD strategy will help you organize your product
planning and research, capture your customers' views
and expectations, and accurately plan and resource
your NPD project.
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III. Product Development strategy
Your strategy will also help you avoid :
 overestimating and misreading your target market;
 launching a poorly designed product, or a product
that doesn't meet the needs of your target customers;
 incorrectly pricing products;
 spending resources you don't have on higher-thananticipated development costs;
 exposing your business to risks and threats from
unexpected competition.
IV. Possible strategies for product
development
The following are possible strategies for product
development:
1. Product Development Diversification Strategy
This strategy is employed when a company's existing
market is saturated, and revenues and profits are
stagnant or falling. There is little or no opportunity
for growth. A product development diversification
strategy takes a company outside its existing
business and a new product is developed for a new
market.
IV. Possible strategies for product
development
2. Product Modification Strategy
Product modification strategies are generally aimed
at existing markets, although a side benefit may be
the capturing of new users for the new product.
3. Revolutionary Product Development
Revolutionary products are those for which there was
no real prior need. Computers and cell phones are
good examples. Before these products appeared on
the market, consumers did not know they needed
them.
V. What product development
strategy for the Post in Africa
Our core product, the mail, can no longer sustain our
business. Volumes are falling, revenues are decreasing,
customers have drastically moved away from mail for
faster alternatives like telephones, SMS, e-mail.
As a result of these alternatives, there is a declining
market share and stagnant or falling profits.
 The
question is, “what is the best alternative product
development strategy for our posts?”
 It is clear that the post in Africa needs a Product
Diversification Strategy.
VI. Steps
There are several important steps you will need to plan into
your NPD strategy.
 Define your product
An accurate description of the product you are planning will help
keep you and your team focused and avoid NPD pitfalls such as
developing too many products at once, or running out of resources
to develop the product.
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Identify market needs
Successful NPD requires a thorough knowledge of your target
market and its needs and wants. A targeted, strategic and
purposeful approach to NPD will ensure your products fit your
market. Ask yourself:
Draw on your existing market research. You may need to
undertake additional research to test your new product proposal
with your customers. For example, you could set up focus groups or
a customer survey.
VI. Steps
3. Establish time frames
You need to allow adequate time to develop and
implement your new products. Your objectives for
developing new products will inform your time frames
and your deadlines for implementation. Be thoughtful
and realistic.
4. Identify key issues and approaches
There are many tasks involved in developing a product that is
appropriate for your customers. The nature of your business
and your idea will determine how many of these steps you
need to take. You may be able to skip or duplicate certain
stages, or start some of them simultaneously.
VI. Steps
Key tasks include:
generating and screening ideas
 developing and screening concepts
 testing concepts
 analyzing market and business strategy
 developing and market testing products
 implementing and commercializing products.
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VII. Way Forward
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Benchmarking the Process.
Having identified the strategy, there is need to benchmark
along the way. Many Post offices around the world have
successfully diversified into new products and the Post in Africa
can easily benchmark.
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Consumers Front and Center
Post offices need to put the consumer at the fore front of the
product development strategy and process. Consumers need to
be front and center and involved in the process from start to
finish. Focusing on customer needs will lead to a successful
strategy. Set aside enough budget for consumer evaluation of
the new product at all product stages.
VIII. Recommendations

It is recommended that post offices
develop a Product Diversification
Strategy to ensure their sustainability in
the communications market. They should
come up with products that are more
inclined to modern technology and will
appeal to new consumers.
IX. Conclusion
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New product development is an important
way for businesses to stay ahead of the
competition and continue to appeal to the
changing needs of existing customers.
In addition, new product development can
open up new marketing channels and help to
increase market share.
However, there is need to have the right
strategies in place to provide unifying and
successful direction.
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