Pick a familiar company and assume you are responsible for generating new-product ideas. Describe the steps of new-product development process. What sources of new ideas would be most valuable?
Answers
Answer:
We have considered the role of new products throughout this module. It is important to introduce new products in order to have a balanced portfolio containing products at the various stages of the product life cycle. We have not yet focused on ways of creating successful new products.
In this module we will discuss a standard, somewhat fixed new-product development process. The logic behind this rather rigid process is that it requires a great deal of discipline to create new products. It’s expensive to launch a successful new product—but it’s far more expensive to launch an unsuccessful products. For these reasons, organizations invest a lot in the creation and refinement of their new-product development processes. It helps them raise the odds that they’ll be successful.
Consider the following dramatic product failures that, in hindsight, should have been screened out much earlier in the product development process.
In 1998 Frito-Lay introduced WOW! chips. These snack chips contained significantly less fat and fewer calories than other snack foods thanks to the fat substitute Olestra. Initially, the product performed well, generating $347 million in 1998 and making WOW! the best-selling potato chip brand that year. The success was short lived, though. Olestra had an unpleasant side-effect: soon customers complained of cramping, incontinence, and diarrhea—in some cases requiring hospitalization—after eating the chips. Frito-Lay’s parent company, PepsiCo, spent $35 million on an advertising campaign to turn things around, but sales plummeted nonetheless.[1]
In 2011 Hewlett Packard launched a product designed to go head-to-head with Apple’s iPad. The product boasted a higher number of performance features than the iPad, but it had none of the “cool factor” that drew customers to Apple. MarketWatch reported, “Despite large-scale press events and promotions, the HP TouchPad was a colossal failure and was discontinued almost immediately. As a result of the TouchPad’s failure, the company wrote off $885 million in assets and incurred an additional $755 million in costs to wind down its webOS operations, ending all work on the TouchPad’s failed operating system.”
To repeat: developing new products creates opportunity and risk.
The specific things you’ll learn in this section include:
Explain how new products are planned
Identify approaches to generate new product ideas
Identify methods to evaluate new product ideas
Explain the process to create and commercialize new products.
Answer:
Product development refers to the complete process of taking a product to market. It also covers renewing an existing product and introducing an old product to a new market. This includes identifying market needs, conceptualizing the product, building the product roadmap, launching the product, and collecting feedback.
New product development (NPD) is a core part of product design. The process doesn’t end until the product life cycle is over. You can continue to collect user feedback and iterate on new versions by enhancing or adding new features.
product development process
There’s no one role that does product development. In any company, whether an early-stage business or an established corporation, product development unites every department, including design, engineering, manufacturing, product marketing, UI/UX, and more. Each group plays an essential part in the process to define, design, build, test, and deliver the product. As you'll see in this guide, the complexities of the product development process makes product management all that more important.
Explanation:
The new-product-development process in 7 steps
Idea generation
Market Research
Planning
Prototyping
Sourcing
Costing
Commercialization
New product development (NPD) is the process of bringing an original product idea to market. NPD can benefit greatly from agile software development principles as well.
Although the product development process differs by industry, it can essentially be broken down into seven stages: ideation, research, planning, prototyping, sourcing, costing, and commercialization.
Use the following development framework to bring your own product idea to market.
1. Idea generation
Many aspiring entrepreneurs get stuck on the first stage: ideation and brainstorming. This is often because they’re waiting for a stroke of genius to reveal the perfect product they should sell. While building something fundamentally “new” can be creatively fulfilling, many of the best ideas are the result of iterating upon a product already in the wild.
The SCAMPER model is a useful tool for quickly coming up with product ideas by asking questions about existing products. Each letter stands for a prompt:
Substitute (e.g., faux fur for fur)
Combine (e.g., a phone case and a battery pack)
Adapt (e.g., a nursing bra with front clasps)
Modify (e.g., an electric toothbrush with a sleeker design)
Put to another use (e.g., memory-foam dog beds)
Eliminate (e.g., get rid of the middleman to sell sunglasses and pass the savings on to consumers)
Reverse/Rearrange (e.g., a duffle bag that doesn’t wrinkle your suits)
By considering these prompts, you can come up with novel ways to transform existing ideas or even adapt them for a new target audience or problem. Using insights from business analysis can also be helpful to better understand the opportunities in the market.
If you’re still looking for your aha moment, we also put together a list of sources for coming up with your own product ideas, from analyzing online marketplaces and product descriptions for inspiration to reinventing historical trends.
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2. Market Research
With your product idea in mind, you may feel inclined to leapfrog ahead to production, but that can become a misstep if you fail to validate your idea first.
Product validation ensures you’re creating a product people will pay for and that you won’t waste time, money, and effort on an idea that won't sell. There are several ways you can validate your product ideas, including:
Sharing your idea with your target market on online forums etc.
Sending out an online survey to get feedback
Starting a crowdfunding campaign
Test marketing, releasing your idea to a very small group of your target market to get initial feedback.
Researching market demand using Google Trends
Launching a product launch roadmap to gauge interest via email opt-ins or pre-orders
Asking for initial feedback on forums like Reddit
However you decide to go about validating your idea, it is important to get feedback from a substantial and unbiased audience as to whether they would buy your product. Be wary of overvaluing feedback from people who “definitely would buy” if you were to create your theoretical product—until money changes hands, you can’t count someone as a customer. Asking advice from your family and friends (unless they have prior experience) is also something to avoid.
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