Podcast
Questions and Answers
What is the first stage in the new product development process?
What is the first stage in the new product development process?
Which of the following options is NOT part of the 4 Ps of marketing?
Which of the following options is NOT part of the 4 Ps of marketing?
What is the main purpose of the screening and evaluation stage in new product development?
What is the main purpose of the screening and evaluation stage in new product development?
During which stage of the new product development process is the product prototype created and tested?
During which stage of the new product development process is the product prototype created and tested?
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Which approach focuses on making current products more appealing to existing customers?
Which approach focuses on making current products more appealing to existing customers?
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What should be assessed during the business analysis stage?
What should be assessed during the business analysis stage?
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What is a crucial element that needs to be monitored to avoid bad timing in product launches?
What is a crucial element that needs to be monitored to avoid bad timing in product launches?
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Which stage involves launching the product and fully marketing it in the marketplace?
Which stage involves launching the product and fully marketing it in the marketplace?
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Why is company structure important in new product development?
Why is company structure important in new product development?
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What is a primary goal during the idea generation stage?
What is a primary goal during the idea generation stage?
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What is the primary focus during the introduction stage of the product life cycle?
What is the primary focus during the introduction stage of the product life cycle?
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Which of the following strategies is NOT typically used to extend a product's life cycle?
Which of the following strategies is NOT typically used to extend a product's life cycle?
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During which stage of the product life cycle do many competitors enter the market?
During which stage of the product life cycle do many competitors enter the market?
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What does a penetration pricing strategy aim to achieve?
What does a penetration pricing strategy aim to achieve?
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Which of the following is a characteristic of the maturity stage in the product life cycle?
Which of the following is a characteristic of the maturity stage in the product life cycle?
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Which factor does NOT typically shorten the product life cycle?
Which factor does NOT typically shorten the product life cycle?
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In the context of new products, what is considered 'radical innovation'?
In the context of new products, what is considered 'radical innovation'?
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What typically happens to pricing strategies during the decline phase of the product life cycle?
What typically happens to pricing strategies during the decline phase of the product life cycle?
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Which stage of the product life cycle focuses on ensuring product differentiation?
Which stage of the product life cycle focuses on ensuring product differentiation?
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What type of marketing focus is typically observed in the decline stage?
What type of marketing focus is typically observed in the decline stage?
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Which of the following is NOT a barrier that can deter product adoption?
Which of the following is NOT a barrier that can deter product adoption?
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What is the main goal of modifying the market as a strategy to extend the product life cycle?
What is the main goal of modifying the market as a strategy to extend the product life cycle?
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Which phase of new product development poses the highest risk of failure?
Which phase of new product development poses the highest risk of failure?
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Study Notes
The Product Life Cycle
- Product Life Cycle - describes the stages that a new product goes through
- Product Life Cycle Stages - Introduction, Growth, Maturity, Decline - each stage consists of varying competition, marketing objectives, product, price, place & promotion strategies and profits
- Introduction Stage - few competitors exist, focus on establishing awareness with advertising, minimal profits, limited distribution, skimming or penetration pricing
- Growth Stage - more competitors enter the market, product differentiation becomes key, prices slowly reduced, distribution is increased, emphasis on points of difference versus the competition, increased profits
- Maturity Stage - many competitors in the market, focus on brand loyalty, ensures full product line is available & innovative, price discounts are frequently used, full distribution is achieved, focus on pricing and sales promotion, maximized profits that level off
- Decline Stage - reduced competition, some competitors may leave the market, retain best sellers and discontinue others, very low prices, reduced distribution, only minimal promotion, decreasing profits and minimal profits
- Length of Product Life Cycle - varies according to industry, competition, technological innovation and marketing approaches
- Shortening Product Life Cycle - mass communication vehicles, technological changes
- Lengthening Product Life Cycle - marketing approaches to keep products relevant
- Product Life Cycle Shapes - there are different shapes of the product life cycle depending on factors like industry/product, competition, etc.
- Strategies to Extend the Product Life Cycle - modifying the product, modifying the market, repositioning the product, introducing a new product
Modifying the Product
- Strategies for Modifying the Product - product improvements, line extensions
Modifying the Market
- Strategies for Modifying the Market - finding new customers, increasing a product’s use, creating a new situation
Repositioning a Product
- Repositioning the Product - changing the perception of the product in the customer's mind
Introducing a New Product
- Introducing a New Product - can be the best way to extend the product life cycle
- New Product Awards - are given to products across various categories: health and beauty, food and beverage, household products, etc.
New Products
- New Products - the lifeblood of a company, helps make products relevant and generate future revenue
- Degree of Product Innovation - can be categorized as minor, continuous or radical
- Minor Innovation - requires no new learning by consumers, example: new and improved toothpaste
- Continuous Innovation - changes consumers normal routine, but doesn't require totally new learning, example: Swiffer WetJet, wearable technology
- Radical Innovation - requires new learning and consumption patterns by consumers, example: Amazon Alexa, Google Home, self-driving cars, 3D printers
- Marketing Emphasis for New Products - minor innovation: gain consumer awareness and wide distribution, continuous innovation: advertise points of difference and benefits, radical innovation: educate consumers through advertising
The Adoption Curve
- The Adoption Curve - shows the rate of adoption of a new product in the market, categorized into innovators, early adopters, early majority, late majority, laggards
- Innovators - first to adopt a product, risk-takers, often influential
- Early Adopters - opinion leaders, value innovation
- Early Majority - make up the majority of the market, more cautious
- Late Majority - adopt the product when it becomes more mainstream, may be risk averse
- Laggards - last to adopt, often prefer traditional products
- Barriers to Adoption - usage, value, risk, psychological
New Product Development
- New Product Development - expensive undertaking, high risk of failure, high research costs, time and effort on developing prototypes and marketing materials, expensive product launches, lack of future credibility in the market
- Avoiding New Product Failure - factors to consider include insignificant point of difference, incomplete new concept definition, insufficient market research, poor execution of the marketing mix, bad timing
New Product Development Strategies
- Strategic Direction - companies can use market penetration, product development, market development, or diversification strategies to grow their business
- Market Penetration - finding ways to make current products appeal to current customers
- Product Development - reaching current customers with a new product
- Market Development - reaching new customers with current products
- Diversification - reaching new customers with new products
- Company Structure - success requires expertise from people with different specializations
New Product Development Process
- New Product Development Process - consists of 7 stages: new product development strategy, idea generation, screening and evaluation, business analysis, test marketing, development, commercialization
- New Product Development Strategy - identify new-product development focus that meets company objectives & conduct SWOT analysis
- Idea Generation - brainstorm new ideas from employees, coworkers, consumers
- Screening and Evaluation - evaluate product ideas and develop technical feasibility
- Business Analysis - identify product's features, marketing strategy, make financial projections, assess production, legal, and profitability issues
- Test Marketing - test product and marketing strategy on a limited scale
- Development - create prototype, test internally and externally
- Commercialization - launch and fully market the product, implement all areas of the marketing mix, possible regional rollout
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Description
This quiz explores the Product Life Cycle, detailing each of its four critical stages: Introduction, Growth, Maturity, and Decline. Learn about the marketing strategies, competition, and profit dynamics that characterize each phase of a product's lifecycle.
