| A | B |
|---|
| New Product | a product new to the world, the market, the producer, the seller, or some combination of these (six categories) |
| New-to-the-world products | (New Product Catagory) products that create an entirely new market (smallest category of new products) |
| New Product Lines | (New Product Catagory) Products, which a firm has not previously offered, allow it to enter an established market (eg. Disney introduced fragrances for boys 4-11 branded Buzz Lightyear and Pirates of the Caribbean) |
| Additions to Existing Product Lines | (New Product Catagory) New products that supplement the established line (eg. Wii fit) |
| Improvements or Revisions of Existing Products | (New Product Catagory) Products "new and improved" that have either been significantly or slightly changed (eg. Heinz easy squirt ketchup bottle) |
| Repositioned Products | (New Product Catagory) Existing products targeting new markets (eg. Harley Davidson tapping younger riders with newer, lighter bikes) |
| Lower-Priced Products | (New Product Catagory) Products that provide similar performance to other products but at lower cost (eg. HP printer, color copier, scanner, fax machine combination) |
| Booz, Allen, And Hamilton's Success Actions | Make the long term commitment to innovation and new product development; Use a company-specific approach with a well defined new-product strategy at its core; Capitalize on experience to achieve and maintain competitive advantage; Establish an environment (MGMT style, organizational structure, and top MGMT support) conducive to achieving company-specific new product and corporate objectives |
| New Product Development Process | 1. New Product Strategy 2. Idea Generatoin 3. Idea Screening 4. Business Analysis 5. Development 6. Test Marketing 7. Commercialization |
| 1. New Product Strategy | (Product Development Step) a plan that links the new product development success with the objectives of the marketing department, the business unit, and the corporation |
| 2. Idea Generation | (Product Development Step) ideas com from: Customers, Employees, Distributors, Competitors, Vendors, R & D, and Consultants |
| Product Development | Goes beyond applied research by converting applicaitons into marketable products |
| Product Modification | cosmetic or funtional changes to existing products |
| 4 types of R & D | Basic Research, Applied Research, Product Modification, Product Development |
| Brainstorming | getting group to think of unlimited ways to vary a product or solve a problem |
| 3. Idea Screening | (Product Development Step) Eliminate the bad ideas and those ideas that are inconsistent with the company's new-product strategy (includes concept tests) |
| Concept Test | to test o evaluate a new product idea, usually before any prototype has been created |
| 4. Business Analysis | (Product Development Step) stage 2 of the screening process where preliminary figures of demand, cost, sales, and profitability are calculated |
| 5. Development | (Product Development Step) prototype is created and marketing strategies are outlined |
| Simultaneous Product Development | a team oriented approach to new product development |
| Consumer Product Safety Act of 1972 | requires manufacturers to perform reasonable testing programs to ensure their products conform to established safety standards |
| 6. Test Marketing | (Product Development Step) limited introduction of a product and a marketing program to determine the reactions of potential consumers in a market situation |
| Simulated (laboratory) Market Testing | the presentation of advertising and other promotion materials for several products, includng a test product, to members of a target market |
| 7. Commercialization | (Product Development Step) the decision to market a product |
| Adopter | a consumer who was happy enought with his exoerience with a product to use it again |
| Innovation | A product that is perceived as new by the potential adopter |
| Diffusion | the process by which the adoption of an innovation spreads |
| Five Catagories of Adopters | Innovators, Early Adopters, Early Majority, Late Majority, Laggards |
| Innovators | 1st 2.5% of those who adopt products; eager consumers wanting to try new things almost obsessively |
| Early Adapters | 13.5% of adopters who are eager to try new things, but, unlike innovators, conform more to social norms and values (trend setters) |
| Early Majority | 34% of adopters who weigh pros and cons before adoptind a new product. Rely on group information. |
| Late Majority | 34% who adopt a new product because their friends all have them and they are pressured to conform; dominant characteristic is skepticism (Smyth with his Blackberry) |
| Laggards | final 16% of adopters who do not care about group norms. They are low in socioeconomic status and are suspicious of new products, thus marketers ignore them |
| Five Characteristics Influencing the Rate of Adoption | Complexity, Compatibility, Relative Advantage, Observability, Trialability |
| Product Life Cycle | a concept that provides a way to trace the stages of a product's acceptance, from its introduction (birth) to its decline (death) |
| Product Category | All brands that satisfy a particular type of need (cars, soft drinks) |
| Introductory Stage | (PLC Stage) full scale launch of a product on the market (high costs, negative profits) |
| Growth Stage | (PLC Stage) Sales grow at an increasing rate, profits peak, and competitors enter the market; distribution becomes the main focus |
| Maturity Stage | (PLC Stage) Sales increase at a decreasing rate, profits fall off and the market reaches saturation |
| Decline Stage | (PLC Stage) Long run drop in sales |
