New Product Development

Topics: Marketing, Product management, Marketing research Pages: 11 (3913 words) Published: January 7, 2013
In this emerging competitive and technology-driven market, every business and organization need to innovate to remain in the marketplace. Hence, a successful new product can be said as a very important ‘weapon’ or an absolute advantage for a company to attain its position in the market share. According by Patrick (1997), new product help keep the firm has the competitive advantages in the changing market. The new products enable the firm’s competitors falling behind the firm in the market and compelling others to meet similar standard (Wheelwright and Clark, 1995) and spread the marketing risk. 1.1Categories of New Product

New product is fall into three general categories which depends on the market type of product is entering and the degree of innovation of the product entering. The first category is new market with a radically innovate product or product line which represented by a breakthrough product that are such revolutionary till a new market has been created. The new product in this category is the new to the world product which creates essentially new market. The example of this category is Apple Ipod, the features and innovation of the Ipod has successfully creates a market for demanding its product. However, there are so rare of highly innovate product that very few new product can be fall into this category. The second category of new product is new product or product line entering existing but not previously targeted market. The new products in this category are the new product lines and addition to existing product lines. A new product item or product line will be introduced by a marketer to an existing but not previously targeted market. The new products will enable the company to move into the existing market as the first time. Usually, these product that been introduced is similar to their competitors product that available in the market but with some changes such as different features and lower price. The product of Xbox by Microsoft’s entering the video gaming systems market will be a good example of this category. Lastly, the third category of new product is enhancement of existing product or product line without moving its existing and previously targeted market. The products in this category are the improvements or revised of the existing product lines, repositioning product and the cost reduction product. The new products devote increased performances or features to replace the existing product. The product of Hero Honda, Splendor has been upgrade to Splendor +. The marketer is attempting to maintain or improve its position in the market by improved or upgraded existing product or extension of product line by adding new products. Procter and Gamble’s Tide product line can be an example of this category as its many product variation of the basic Tide product. A product that provides similar services or performances with existing product at lower cost is considered as new product. 1.2Purposes of Introducing New Product

The main purpose of introduction of new products in the market is to fulfill the customers’ needs and wants. As we know, the needs and wants of customers keep changing from time to time. If the firm fails to respond to these changes by their products or services, the customers will definitely switch to the competitor products that can meet their needs and wants. Plenty of new products that been introduced to market has earned more profits than the existing products. If the new products that launched are considered innovative or unique, the products might enjoy the achievement and facing little or no competition for a period of time initially. A product line of companies has limited depth can miss out more sales that the companies can actually achieve. Hence, a new product can fill out the variation of product line and adding attraction to the customers; the sales of the product line will be increased. In addition, the sales of seasonal products or cyclical products that...
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