CH8 developing new products and managing the product life cycle

Acquisition

by buying a whole company, a patent, or a license to produce another product

New product development

products the firm develops through its own product development

Major Stages in New Product Development

1. Idea generation

2. Idea screening

3. Concept development and testing

4. Marketing strategy development

5. Business analysis

6. Product development

7. Test marketing

8. Commercialization

Idea generation

the systematic search for new product ideas

Idea Screening

screening new product ideas to spot good ones and drop poor ones as soon as possible

Concept Development and Testing

product idea, product concept, product image

Marketing strategy development

designing an initial marketing strategy for a new product based on the product concept

Business analysis

a review of the sales, costs, and profit projections for a new product to find out whether these factors satisfy the company's objectives

Product development

developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering

Test marketing

introduces the product and its proposed marketing program into realistic market settings

Commercialization

introducing a new product into the market

Product life-cycle strategies

1. product development

2. introduction

3. growth

4. maturity

5. decline

Introduction stage

The initial stage of a product's life cycle; its first appearance in the marketplace, when sales start at zero and profits are negative

Growth stage

the PLC stage in which a product's sales start climbing quickly

Maturity stage

stage of the product life cycle when industry sales reach their peak, so firms try to rejuvenate their products by adding new features or repositioning them

Decline stage

in the decline stage the company may also look for ways to reinvigorate the brand.