new product launch(sec a+ sec b)

8/4/2019 New Product Launch(Sec a+ Sec B)

1/96

NEW PRODUCT LAUNCH

SECTION A GROUP 5

SREERAMULA RAJEEV(11DCP047)

AJAY BISHT(11DCP004)

CHINMAY BARIK(11DCP016)

RAJATH RAVIKUMAR(11DCP037)

SECTION B

ANURAG RANA

PIYUSH BHANDARI

SUDHANSHU SHARMA

SWATI BHARGAVA


2/96

NEW PRODUCT


3/96

WHAT IS A NEW PRODUCT?

A product that opens up entirely new into amarket New to the world

A product that adapts or replaces an existingproduct.

A product that significantly broadens themarket for existing product.

An old product introduced into a new market. An old product packaged and marketed in a

different way.


4/96

New To The World

I pad Google +


5/96

1. New to the world products, or really new

products

Mahindra - Reva Emami Fair & Handsome

Accounts for 10% of the new products.


6/96

New product lines

Mars Ice Cream

Mahindra Bikes


7/96

2. New to the firm, or new product lines.

WALT DISENY THEME PARKSVIRGIN AIRLINES



8/96

Additions to the product line

Polaris Software


9/96

3. Additions to existing Product line

Tide Liquid Detergent Coca Cola - Sprite



10/96

Product Improvement and

replacement

Maruti 800 Maruti Alto


11/96

Repositioning

Maruti Wagon R

I Generation - 1993- 1998

II Generation - 1998- 2003

III Generation - 2003- 2008IV Generation - 2008- Present


12/96

New Products Can be Used To

Increase market share by offering more

choices and updating older products. Appeal to new segments.

Diversify into new markets.

Improvements and revisions of existingproducts.


13/96

NEW PRODUCT LAUNCH

Introduction of a new product or a version of aproduct into the segmented market

Put the Focus on the People, Not theProduct--- Steve Jobs


14/96

PRODUCT LAUNCH DEFINITIONS

The process by which a new product is

introduced into the market for initial sale. It

includes the engineering, market analysis, and

the development of a communication strategy.

A Product Launch is a marketing strategy

consisting ofa carefully planned and scheduled

sequence of events with the goal to make a bighappening out of the release and, of course make

as much sales as possible in a short time span


15/96

Contd...

Product Launch is the most intense part of theproduct cycle. It is the period where theproduct is announced to the outside world

and the first order can be placed. Product launch is the orchestrated

introduction of a new product (or version of aproduct) to the market; the eventssurrounding making the product available forpurchase for the first time.


16/96

Why a product launch?

To show the people a compelling

picture of how the product is

going to make their life better How the product is going to fit into

the life of the people

To make the people aware of the benefits andusage of the new product and in what way

the product is a better option in the market


17/96

Contd..

To satisfy additional customer demand.

Spotting an additional way ofadding value to

your existing portfolio, in a new or existingniche.

As a means of diversifying, to either grow the

business, or to protect future earnings as a

cash cow, reaches end of life.


18/96

New Product Development

Process

IdeaIdeaGenerationGeneration

ConceptConceptDevelopmentDevelopmentand Testingand Testing

MarketingMarketingStrategyStrategy

DevelopmentDevelopment

IdeaIdeaScreeningScreening

BusinessBusinessAnalysisAnalysis

ProductProductDevelopmentDevelopment

MarketMarketTestingTesting

CommercializationCommercialization


19/96

THE NEW PRODUCT DEVELOPMENT

PROCESS


20/96

Factors That Limit

New Product Development

Shortage of effective ideas

Fragmented markets

Social and governmental constraints Cost of development

Capital shortages

Faster required development time Shorter product life cycles


21/96

IDEA GENERATION


22/96

Idea Generation: Creativity Techniques

Attribute listing

Forced relationships

Morphologicalanalysis

Reverse assumption

analysis

New contexts Mind mapping


23/96

Opportunity Identification

Internal sources Company employees at all levels

External sources Customers

Competitors

Distributors Suppliers

Outsourcing


24/96

P&G marketers spend at least 12 hours a

month with consumers in their homes ,

watching how they wash dishes, clean floors

and brush teethes and asking them about

their habits and sources of frustration.


25/96

Toyota claims its employees submit 2 million

ideas annually.

Microsoft studied 13 to 24 years old anddeveloped Net Gen to satisfy their instant

messaging needs.


26/96

Lateral Mapping

Gas stations + food

Cafeteria + Internet Cereal + snacking

Candy + toy

Audio + portable


27/96

IDEA SCREENING


28/96

Idea Screening

After the firm identifies potential products, it

must screen them. In product screening , poor,

unsuitable or otherwise unattractive ideas are

weeded out from further actions.

No Error can occur if company permits poor

ideas to move into development and

commercialization.


29/96

QUESTIONS OF SCREENING

Does the product meet a need?

Would it offer superior value?

Can it be distinctively advertised?

Does the company has necessary capital?

Will the new product deliver the expectedsales volume, sales growth and profit?

Is there sufficient demand?

Does it fit the firms image?


30/96

CONCEPT DEVELOPMENT


31/96

Concept Development

Product ideaAproduct idea is a possible product the company might offer to the market.

Eg:

A car manufacturer figures outhow to design an fuel cell

powered electric car that can goas fast as 110 km per hour and asfar as 370 km before needing to

be recharged.T

he manufacturerestimates that the electric car'soperating costs will be about half

those of a regular car.

Idea


32/96

Customers, do not buy a product idea;

they buy a product concept

What is Product Concept?

Adetailed version of the new-product idea stated in

meaningful consumer terms.

What product concepts can

we create for the abovementioned electric car?


33/96

Concept 1. Amoderately priced subcompact

designed as a second family carto be used

around town. The car is ideal for running

errands and visiting friends.

Concept 2. Amedium-cost, sporty compactappealing to young people.

Concept 3. An inexpensive subcompact

'green' carappealing to environmentallyconscious people who want practical

transportation and low pollution.


34/96

Concept Testing

Concept testing calls for testing new-product concepts with a

group oftarget consumers. The concepts may be presented

to consumers symbolically or physically.

Here, in words, is Concept 3: An

efficient, fun-to-drive, fuel-cell-

powered electric sub compact car that

seats four. This high-tech wonder runs

on hydrogen created from methanol

fuel, providing practical and reliable

transportation with almost nopollution. It goes up to 110 km per

hour and, unlike ordinary battery-

powered electric cars,never needs

frequent recharging. It's priced, fully

equipped, at $13000.


35/96

After being exposed to the concept, consumers may

then be asked to react to it by answering the questions:

Do you understand the concept of an hydrogen cell electric car?

Yes( ) No( )

Do you believe the claims about the car's performance?

Yes( ) No( )

What are the main benefits of the electric car compared with a conventional car?

What improvements in the car's features would you suggest?

For what uses would you prefer an electric car to a conventional car?

What would be a reasonable price to charge for the electric car?

Who would be involved in your decision to buy such a car? Who would drive it?

Would you buy such a car?Definitely( ) Probably( ) Probably not( ) Definitely not( )


36/96

The answers will help the company decide whichconcept has the strongest appeal.

Product concept tests helps us to gaugecustomers' response as well as to identify aspects

of the concept that are particularly liked ordisliked by potential buyers.

Feedback might suggest ways to refine theconcept, thereby increasing its appeal tocustomers,

Concept testing of prototypes can help avoidcostly mistakes.

Why Concept Testing?


37/96

Examples of Concept Testing gone

wrong

Click to play Video


38/96

MARKET STRATEGYDEVELOPMENT


39/96

Marketing Strategy Development

Suppose the car manufacturing company findsthat Concept 3 for the fuel-cell-powered electriccar tests best. The next step is to develop amarketing strategy for introducing this car to themarket.The marketing strategy statement consists ofthree parts.

I. The first part consists of:1. Target market2. product positioning

3. Sales,market share and profit goals


40/96

Target Market

Young

Well-educated

Moderate-to-high income individuals Couples or small families

Environmentally responsible/ Socially

Conscious


41/96

Position

The car will he positioned as:

More economical to operate

More fun to drive Environmental Friendly: Less polluting than

today's internal combustion engine cars

Less restricting than battery powered electriccars which must be recharged regularly


42/96

Sales, market share and profit goals for

the first few years

The company will aim to sell 100,000 cars in

the first year, at a loss of not more than 10

million.

In the second year, the company will aim for

sales of 120,000 cars and a profit of

$25million.


43/96

II. The second part of the marketing

strategy statement outlines: Product's planned price

Distribution

Marketing budget

The fuel-cell-powered electric car will be offered in three colors and willhave optional air-conditioning and power-drive features. It will sell at a

retail price of $13,000 - with 15 per cent off the list price to dealers.

Dealers who sell more than 10 ears per month will get an additional

discount of 5 per cent on each car sold that month.

An advertising budget of $8 million will be split fifty-fifty between nationaland local advertising.

Advertising will emphasize the car's fun and low omissions.

During the first year, $70,000 will be spent on marketing research to find

out who is buying the car and to determine their satisfaction levels.


44/96

III. The third part of the marketing

strategy statement describes:

Planned long-run sales

Profit goals

Marketing mix strategy

The company intends to capture a 3 per centlong-run share of the total car market and realizean after-tax return on investment of 15 per cent.

Product quality will start high and be improved

over time. Price will be raised in the second and third yearsif competition permits.


45/96

SOUTHWEST AIRLINES


46/96

Strategy

low-cost

point-to-point service

does not offer :a. Meals

b. Assigned seatsc. Interline baggage checking, or

d. Premium classes of service

does not fly great distances

midsize cities and secondary airports in large cities

Result

attract price-sensitive customers fast turnarounds

keep planes flying longer hours

provide frequent departures with fewer aircraft


47/96

IKEA

Strategy Click to Play Video

self-service

young furniture buyers who want style at low cost

serves customers who are happy to trade off service for cost

designs its own low-cost, modular, ready-to-assemble furniture

displays every product it sells in room-like settings Customers are expected to do their own pickup and delivery

Ikea will even sell you a roof rack for your car that you can return for a refund onyour next visit

Extra Services

In-store child care

Extended hours

Note: These services are uniquely aligned with the needs of its customers, who areyoung, not wealthy, likely to have children (but no nanny), and, because they workfor a living, have a need to shop at odd hours.


48/96

BUSINESS ANALYSIS


49/96

Business Analysis

Business Analysis

Estimating Sales, Costs,

and Profits Projections to See if

They Meet Company Objectives

If Yes, Move to

Product Development

If No, Eliminate

Product Concept


50/96

Estimating Total Sales

It is sum of 1st time sales, replacement sales and

repeat sales.

Tasks Involved in Sales Estimation:

Estimating first time purchases of the new product. Estimating replacement sale by estimating the

number of units that failed in one year.

For a frequently purchased new products, the seller

has to estimate repeat sales as well as first time

sales.


51/96

Estimating Cost & Profits

Costs are estimated by R&D, Manufacturing,

Marketing and Finance departments.

They project cash flow statements for certain

period of time say 5 years and evaluate that

how much time it will take product to enter

into pay back stage.

Pay back stage is the stage when companystarted recovering all its investments.


52/96

Projected 5 Year Cash Flow Statement


53/96

Cont..

From the projections we can conclude

Maximum Investment Loss= $4.6 Million

Pay Back Period is of 3.5 years.

Now this goes with the management to decide

whether to take risk of $4.6 million and apossible payback period of 3.5 years.


54/96

PRODUCT DEVELOPMENT


55/96

Product Development

Product development converts a product idea

into a physical form and identifies a basic

marketing strategy.

It involves working prototype construction.

Quality Function Deployment

Customer Attributes

Engineering Attributes


56/96

What is QFD

QFD stands for Quality Function Deployment.

QFD is a set of methods used in translating customersneeds and demands into working prototype.

Its takes as input all the customer needs and demandsand provides a technical output for engineers to build a

prototype.

Example customer wants powerful bike with goodacceleration and engineers can turn the need intorequired horsepower.

QFD is improved communication between Marketers,Engineers and Manufacturing People.


57/96

57

Product Development through

Acquisition

Large companies will sometimes buy a

small companies rather than develop their

own new companies.

Examples

Recently Google acquired Motorola

Mobility.

PepsiCo purchased Tropicana Products.


58/96

TEST MARKETING


59/96

Test Marketing

Launching a product in a small geographical area

A field experiment in realistic market setting

Aims

-To predict likely results of a national launch

-To test the operational effectiveness of

the marketing plan

-To identify possible problems

-To assess consumer reaction


60/96

Customers Test

Alpha Testing is testing the product within the

organization to see how it performs in

coordination with different application.

Beta testing is testing with sample of

consumers to bring them into lab or give them

samples to use them at home.


61/96

Examples Of Customer Testing

P&G has on site labs such as diaper testing

centre where dozens of mothers bring their

babies to be studied.

Yahoo, Google always comes with their beta

products initially to be tested by users in real

scenario and rectify the bugs reported

meanwhile.


62/96

Market Testing

After management is satisfied with functional

and psychological performance, the product is

ready to be branded with a name, logo, and

packaging and go into a market test.

3 Types of Major Market Testing are

Sales Wave Research

Simulated Test Marketing

Controlled Test marketing


63/96

Sales Wave Research

Consumers who initially tried the product at

no cost are reoffered it at slightly reduced

prices than competitors one.

Offer can be made 5 times.

Company notes how many customers select it

again and their reported level of satisfaction.


64/96

Simulated Test Marketing

30 or 40 qualified shoppers are asked aboutbrand familiarity and preferences in particularproduct category and screened to them both well

knownT

V commercials or print ads andadvertisement of new product but is not singledout for attention.

Consumers receives small amount of money and

asked to purchase any item. Consumers are asked the reasons for their

purchase and non purchase.


65/96

Cont..

The company notes how many consumers buythe new brand and competing brands. Thisprovides a measure of the ads relative

effectiveness against competing ads instimulating trial.

Those who did not buy the new brand are given afree sample.

Some weeks later they are interviewed by phoneto know about products value in terms ofsatisfaction.


66/96

Problems ofTest Marketing

The test phase might not be a true indicator

Environment might change between the test and

the national launch, like any natural calamity.

Competition may disrupt the test marketing byengaging in exceptional marketing activity.

Test marketing alerts competitors.


67/96

P&G Bleach V/S Clorox

P&G developed a prototype and entered intomarket to test their product which is a Bleach.

Do you know What Clorox the Rival did?

T

hey gave every household in Portland, Maine, afree gallon of Clorox bleach- delivered to thefront door

And nobody in Portland, Maine, was going toneed bleach for several months and moreoverClorox even gave consumers a $1 off coupon forthe next gallon.

Test Marketing thus subject to external factors.


68/96

COMMERCIALIZATION


69/96

COMMERCIALIZATION

Commercialization is the process of

introducing a new product or production

method into the market.


70/96

Commercialization process The funnel. It is essential to

look at many ideas to getproducts or businesses

that can be sustained long-

term

It is a stage-wise process

and each stage has its own

goals and milestones

I

t is vital to involve mainstakeholders early,

including customers


71/96

WHEN(Timing)

First entry-Firm enjoys first mover advantagecan backfire if the product is not debugged

Parallel entry-Firm might time its entry to coincide with thecompetitors entry

the market may pay more attention when both the companiesare advertising the new product

Late entry-Firm might delay its launch until after the

competitor has borne the cost of educating the marketthe firm can learn the size of the market and avoid flaws


72/96

Where(Geographic strategy)

Small companies select an attractive city andput on blitz campaign,entering one city at a

time.

Large companies introduce their product into

a whole region and then move to the next

Companies with national distribution

networks,such as auto companies,launch

new models nationally.

With the web connecting the far-flung parts

of the globe,companies are increasingly

rolling out new products simultaneously

across the globe.


73/96

To Whom(Target Market Prospects)

Early adopters

Heavy users

Opinion leaders AIM- To generate strong sales as

soon as possible to attract

further prospects


74/96

How(INTRODUCTORY MARKETSTRATEGY)

Management can use networkplanning techniques such as

CRITICAL PATHSCHEDULING-

which develops a master chart

showing the simultaneous andsequential activities that must

take place to estimate the

completion time for the entire

project.


75/96

Woodland: Are you a Woodlander?

identity has been adventurewith shoes

Woodland was launched in the

global market in 1992, and in

1994 it was introduced in India

positioning was very different

from other brands sporting

images.They talked aboutadventure and nature through

their retail presence


76/96

Nestle-Maggiits different

Nestle launched its noodles inindian market in early 1980s,but

it took several years to establish

brand.It had targeted the

convenience of working women. Nestle repositioned the brand

towards the children using sales

promotion and smart advertising.

Taste bhi health bhi-Maggi AttaNoodles


77/96

MEDIUMS OF

LAUNCH


78/96

TYPES OF LAUNCHES

Press Release

Online marketing/Blogging/Social Media

T

elevision Ads Event Launches

Publicity Campaigns

Road Shows Bill Boards


79/96

EVENTS

Products or services launched through

promotional events

Launch ofTata Nano


80/96


81/96

TRAILERS

Mostly Movies and Serials will be launched throughtrailers

Launch of Robot Movie


82/96

AD CAMPAIGNS

Products or Services can be launchedthrough Ad Campaigns

Toyota Etios Launch


83/96

Launch of Hero Motors

Video


84/96

PRINT MEDIA

Products launching through News Papers ,

Magazines

Launch Of Maruti Swift


85/96

BILL BOARDS

Product Launch promotion through Bill

Booards

Bill Board of Mc Donalds introducing Espresso


86/96

Caution: Dont Promote What


87/96

Caution: Dont Promote What

You Cant Deliver

E-Bay made grandiose announcements about

their entry into the Japanese market, well

before they had a localized product ready to

launch in Japan and failed.

Nokia N8 promoted as another innovation but

lags far behind than even first generation

APPLE! And thus failed.

Product Launch


88/96

Product Launch

Launch like Steve Jobs: 7 Ways toBuild Your Next Product Launch

iPhone Launch


89/96

1. Put the Focus on the People, Not

the Product Dont just talk about whatyour product does

Show them a compelling

picture of how its going to

make their life better. Thats

what gets people excited.


90/96

2. Get Opinion Leaders On-Board

Early Apple has a knack for getting

bloggers and other opinion

leaders on board before their

product launches.

They get everyone talking

months before the product

launches . Theyre talking about what it

might do


91/96

3. Be Revolutionary

Do something noneof your competitors

have ever done

before

Paint a picture of

the future that your

customers want to

live in

4 Turn Your Product Launch into an


92/96

4. Turn Your Product Launch into an

Event

They stage an entire event

around it, going so far as to

even close their online store,

so that everyone knows

something important is

happening and they need to

pay attention.


93/96

5. Take Pre-Orders

Apple almost always offers

pre-ordering of their new

products

Its not uncommon for them

to sell hundreds of thousandsof units within a week of

launch

6 Release a Product Your Customers


94/96

6. Release a Product Your Customers

Will Want to Show off

Dont underestimate the

importance of your products

appearance.

A professional design makes

people want to talk about it

online or offline, it can have a bigimpact on your product sales

7 Draw out the Suspense for As Long


95/96

7. Draw out the Suspense for As Long

As You Can

The mystery will drive your customer base into

a frenzy.


96/96

new product launch(sec a+ sec b)

Documents