77_43515_EA211_2013_1__1_1_kotler13e_crs_09.ppt

Marketing

1. Chapter 9-slide 1
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Chapter Nine
New-Product Development and
Product Life-Cycle Strategies

2. Chapter 9-slide 2
Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
New-Product Development and
Product Life-Cycle Strategies
•New-Product Development
Strategy
•New-Product Development
Process
•Managing New-Product
Development
•Product Life-Cycle Strategies
•Additional Product and Service
Considerations
Topic Outline

3. Chapter 9-slide 3
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New-Product Development Strategy
Acquisitionrefers to the buying of a whole
company, a patent, or a license to produce
someone else’s product
New product developmentrefers to original
products, product improvements, product
modifications, and new brands developed from
the firm’s own research and development
Two ways to obtain new products

4. Chapter 9-slide 4
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New-Product Development
Reasons for new product failure
Overestimation of market size
Poor design
Incorrect positioning
Wrong timing
Priced too high
Ineffective promotion
Management influence
High development costs
Competition

5. Chapter 9-slide 5
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Which of the following is nota reason that a new
product might fail?
1.The product is priced too high.
2.The product is poorly designed.
3.The estimated market for the product is too large.
4.All of the above are reasons that a new product
might fail.

6. Chapter 9-slide 6
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Which of the following is nota reason that a new
product might fail?
1.The product is priced too high.
2.The product is poorly designed.
3.The estimated market for the product is too large.
4.All of the above are reasons that a new product
might fail.

7. Chapter 9-slide 7
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New-Product Development Process
Major Stages in New-Product Development

8. Chapter 9-slide 8
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New-Product Development Process
Idea generationis the systematic search for
new-product ideas
Sources of new-product ideas
•Internal
•External
Idea Generation

9. Chapter 9-slide 9
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New-Product Development Process
Internal sourcesrefer to the
company’s own formal research
and development, management
and staff, and intrapreneurial
programs
External sourcesrefer to sources
outside the company such as
customers, competitors,
distributors, suppliers, and
outside design firms
Idea Generation

10. Chapter 9-slide 10
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Which of the following isnota good external
source of ideas?
1.Customers
2.The R&D department
3.Suppliers
4.Competitors

11. Chapter 9-slide 11
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Which of the following is not a good external
source of ideas?
1.Customers
2.The R&D department
3.Suppliers
4.Competitors

12. Chapter 9-slide 12
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New-Product Development Process
•Identify good ideas and drop poor ideas
•R-W-W Screening Framework:
–Is it real?
–Can we win?
–Is it worth doing?
Idea Screening

13. Chapter 9-slide 13
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New-Product Development Process
Product ideais an idea for a possible product
that the company can see itself offering
to the market
Product conceptis a detailed version of the
idea stated in meaningful consumer
terms
Product imageis the way consumers
perceive an actual or potential product
Concept Development and Testing

14. Chapter 9-slide 14
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New-Product Development Process
Concept testing refers to testing new-product
concepts with groups of target consumers
Concept Development and Testing

15. Chapter 9-slide 15
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New-Product Development Process
•Marketing strategy development refers to
the initial marketing strategy for
introducing the product to the market
•Marketing strategy statement includes:
–Description of the target market
–Value proposition
–Sales and profit goals
Marketing Strategy Development

16. Chapter 9-slide 16
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New-Product Development Process
Business analysisinvolves a review of the
sales, costs, and profit projections to find
out whether they satisfy the company’s
objectives
Marketing Strategy Development

17. Chapter 9-slide 17
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New-Product Development Process
Product development involves
the creation and testing of
one or more physical
versions by the R&D or
engineering departments
•Requires an increase in
investment
Marketing Strategy Development

18. Chapter 9-slide 18
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New-Product Development Process
Test marketing is the
stage at which the
product and
marketing program
are introduced into
more realistic
marketing settings
Provides the marketer
with experience in
testing the product
and entire marketing
program before full
introduction
Marketing Strategy Development

19. Chapter 9-slide 19
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________ is a review of the sales, costs, and profit
projections for a new product to find out
whether these factors satisfy the company’s
objectives.
1.Market strategy development
2.Product development
3.Business analysis
4.Forecasting

20. Chapter 9-slide 20
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________ is a review of the sales, costs, and profit
projections for a new product to find out
whether these factors satisfy the company’s
objectives.
1.Market strategy development
2.Product development
3.Business analysis
4.Forecasting

21. Chapter 9-slide 21
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When a concept moves into a physical product to
insure that the product idea can be turned into
a workable product, this is referred to as
___________.
1.market strategy
2.product development
3.business analysis
4.commercialization

22. Chapter 9-slide 22
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When a concept moves into a physical product to
insure that the product idea can be turned into
a workable product, this is referred to as
___________.
1.market strategy
2.product development
3.business analysis
4.commercialization

23. Chapter 9-slide 23
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New-Product Development Process
Types of Test Markets
Standard testmarkets
Controlled test markets
Simulated test markets

24. Chapter 9-slide 24
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Which of the following is nota form of test
marketing?
1.Standard test markets
2.Controlled test markets
3.Simulated test markets
4.Perceptual test markets

25. Chapter 9-slide 25
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Which of the following is nota form of test
marketing?
1.Standard test markets
2.Controlled test markets
3.Simulated test markets
4.Perceptual test markets

26. Chapter 9-slide 26
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Some of the drawbacks of ________ test markets
are that they can be very costly, and they can
give competitors a chance to look at the
company’s new ideas.
1.standard
2.controlled
3.simulated
4.Internet

27. Chapter 9-slide 27
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Some of the drawbacks of ________ test markets
are that they can be very costly, and they can
give competitors a chance to look at the
company’s new ideas.
1.standard
2.controlled
3.simulated
4.Internet

28. Chapter 9-slide 28
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New-Product Development
Process
•Advantages of simulated test markets
–Less expensive than other test methods
–Faster
–Restricts access by competitors
•Disadvantages
–Not considered as reliable and accurate due to
the controlled setting
Marketing Strategy Development

29. Chapter 9-slide 29
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New-Product Development Process
Marketing Strategy Development
When firms test
market
•New product
with large
investment
•Uncertainty
about product
or marketing
program
When firms may
not test market
•Simple line
extension
•Copy of
competitor
product
•Low costs
•Management
confidence

30. Chapter 9-slide 30
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New-Product Development Process
Commercialization is the introduction
of the new product
•When to launch
•Where to launch
•Planned market
rollout
Marketing Strategy Development

31. Chapter 9-slide 31
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The systematic search for new-product ideas is
called ________.
1.idea generation
2.idea search
3.idea screening
4.concept development

32. Chapter 9-slide 32
Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
The systematic search for new-product ideas is
called ________.
1.idea generation
2.idea search
3.idea screening
4.concept development

33. Chapter 9-slide 33
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Once the new product ideas have been screened,
the next step in the new product development
process is ________.
1.marketing strategy
2.concept development and testing
3.product development
4.none of the above

34. Chapter 9-slide 34
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Once the new product ideas have been screened,
the next step in the new product development
process is ________.
1.marketing strategy
2.concept development and testing
3.product development
4.none of the above

35. Chapter 9-slide 35
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The final stage in new product development is
referred to as ________.
1.new product penetration
2.commercialization
3.consumer initiation
4.idea screened

36. Chapter 9-slide 36
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The final stage in new product development is
referred to as ________.
1.new product penetration
2.commercialization
3.consumer initiation
4.idea screened

37. Chapter 9-slide 37
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Managing New-Product Development
Successful new-product development should
be:
•Customer centered
•Team centered
•Systematic

38. Chapter 9-slide 38
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Managing New-Product Development
Customer-centered new product
developmentfocuses on
finding new ways to solve
customer problems and
create more customer
satisfying experiences
•Begins and ends with solving
customer problems
New-Product Development Strategies

39. Chapter 9-slide 39
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Managing New-Product Development
Sequential new-product developmentis a
development approach where company
departments work closely together
individually to complete each stage of the
process before passing it along to the next
department or stage
•Increased control in risky or complex
projects
•Slow
New-Product Development Strategies

40. Chapter 9-slide 40
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Managing New-Product Development
Team-based new-product developmentis a
development approach where company
departments work closely together in
cross-functional teams, overlapping in the
product-development process to save
time and increase effectiveness
New-Product Development Strategies

41. Chapter 9-slide 41
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Managing New-Product Development
Systematic new-product
developmentis an
innovative development
approach that collects,
reviews, evaluates, and
manages new-product
ideas
•Creates an innovation-
oriented culture
•Yields a large number of new-
product ideas
New-Product Development Strategies

42. Chapter 9-slide 42
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Product Life-Cycle Strategies
Product Life Cycle

43. Chapter 9-slide 43
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•Product development
–Sales are zero and investment costs mount
•Introduction
–Slow sales growth and profits are nonexistent
•Growth
–Rapid market acceptance and increasing profits.
•Maturity
–Slowdown in sales growth and profits level off or
decline
•Decline
–Sales fall off and profits drop
Product Life-Cycle Strategies

44. Chapter 9-slide 44
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Which of the following is not a stage in the
product life cycle (PLC)?
1.Idea screening
2.Growth
3.Maturity
4.Decline

45. Chapter 9-slide 45
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Which of the following is nota stage in the
product life cycle (PLC)?
1.Idea screening
2.Growth
3.Maturity
4.Decline

46. Chapter 9-slide 46
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Which stage of the product life cycle (PLC) is
characterized by slow growth because the
product has achieved acceptance by most of
its potential buyers?
1.Introduction
2.Growth
3.Maturity
4.Decline

47. Chapter 9-slide 47
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Publishing as Prentice Hall
Which stage of the product life cycle (PLC) is
characterized by slow growth because the
product has achieved acceptance by most of
its potential buyers?
1.Introduction
2.Growth
3.Maturity
4.Decline

48. Chapter 9-slide 48
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Product Life-Cycle Strategies
Fads are temporary
periods of unusually
high sales driven by
consumer
enthusiasm and
immediate product
or brand popularity

49. Chapter 9-slide 49
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Product Life-Cycle Strategies

50. Chapter 9-slide 50
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________ tend to grow slowly, remain popular for
a while, and then decline slowly.
1.Fads
2.Styles
3.Fashions
4.Designs

51. Chapter 9-slide 51
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________ tend to grow slowly, remain popular for
a while, and then decline slowly.
1.Fads
2.Styles
3.Fashions
4.Designs

52. Chapter 9-slide 52
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Product Life-Cycle Strategies
•Slow sales growth
•Little or no profit
•High distribution and promotion expense
Introduction Stage

53. Chapter 9-slide 53
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Product Life-Cycle Strategies
•Sales increase
•New competitors enter the market
•Price stability or decline to increase volume
•Consumer education
•Profits increase
•Promotion and manufacturing costs gain
economies of scale
Growth Stage

54. Chapter 9-slide 54
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Product Life-Cycle Strategies
•Slowdown in sales
•Many suppliers
•Substitute products
•Overcapacity leads to competition
•Increased promotion and R&D to support
sales and profits
Maturity Stage

55. Chapter 9-slide 55
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Product Life-Cycle Strategies
•Market modifying
•Product
modifying
•Marketing mix
modifying
Maturity Stage Modifying Strategies

56. Chapter 9-slide 56
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Product Life-Cycle Strategies
•Maintain the product
•Harvest the product
•Drop the product
Decline Stage

57. Chapter 9-slide 57
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In the ________ stage, sales start climbing quickly
and competition often enters the market.
1.introduction
2.growth
3.maturity
4.decline

58. Chapter 9-slide 58
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In the ________ stage, sales start climbing quickly
and competition often enters the market.
1.introduction
2.growth
3.maturity
4.decline

59. Chapter 9-slide 59
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Product Life-Cycle Strategies
Summary of Product Life Cycle

60. Chapter 9-slide 60
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Additional Product and Service
Considerations
Public policy and regulations regarding developing
and dropping products, patents, quality, and
safety
Product Decisions and Social
Responsibility

61. Chapter 9-slide 61
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Marketers should consider public policy
issues involving product safety,
environment, and warranties. This is
referred to as ________.
1.social responsibility
2.positioning
3.marketing mix
4.commercialization

62. Chapter 9-slide 62
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Publishing as Prentice Hall
Marketers should consider public policy
issues involving product safety,
environment, and warranties. This is
referred to as ________.
1.social responsibility
2.positioning
3.marketing mix
4.commercialization

63. Chapter 9-slide 63
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Additional Product and Service
Considerations
•Determining what products and
services to introduce in which
countries
•Standardization versus
customization
•Packaging and labeling
•Customs, values, laws
International Product and
Service Marketing—Challenges

64. Chapter 9-slide 64
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