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Refine your target marketDetail yourcustomer targetsas accurately as you can. Your focus groups or conversations with

your target audiences will help you determine whether you're targeting the right marketsegments.

Examine intellectual property (IP) issuesFind out whether another business or individual has already patented your idea. If your idea wasthe combined result of several members of your team, consider how you will recognise their

contributions to theintellectual property.Identify the featuresBased on the information you have gathered to date, list the features and benefits of your

proposed product from highest market importance to least.Take your timeDefine your product concept clearly, test it with your audience and dont make any assumptions.

Many NPD ventures fail because businesses rush through concept development and testing.

Developing New ProductsBy its nature marketing requires new ideas. Unlike some organizational functions, where basic

processes follow a fairly consistent routine (e.g., accounting), successful marketers areconstantly making adjustments to their marketing efforts. New ideas are essential for responding

to changing demand by the target market and by pressure exerted by competitors. These changes

are manifested in decisions in all marketing areas including the development of new products.

In addition to being responsive to changing customer tastes and competitive forces, there

are many other reasons why new product development is vital. These include:

Many new products earn higher profits than older products. This is often the case forproducts considered innovative or unique which, for a period of time, may enjoy successand initially face little or no competition.

New products can help reposition the company in customers minds. For instance, acompany that traditionally sold low priced products with few features may shift

customers perceptions about the company by introducing products with more features

and slightly higher pricing.

Fierce global competition and technological developments make it much easier forcompetitors to learn about products and replicate them. To stay ahead of competitorsmarketers must innovate and often create and introduce new products on a consistent

schedule.

Companies with limited depth in a product line may miss out on more sales unless theycan add new products to fill out the line.

Some firms market seasonal products that garner their highest sales during a certain timeof the year or sell cyclical products whose sales fluctuate depending on economic or

market factors. Expanding the firms product mix into new areas may help offset thesefluctuations. For manufacturing firms an additional benefit is realized as new products

utilize existing production capacity that is under-used when seasonal or cyclical products

are not being produced.

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Failure of New Products:-

Many new products with satisfactory potential have failed to make the grade. Many of thereasons for new product failure relate to execution and control problems. The following is a brief

list of some important causes of new product failures after they have been carefully screened,

developed and marketed.

1. No competitive point of difference, unexpected reactions from competitors, or both.2. Poor positioning.3. Poor quality of product.4. Nondelivery of promised benefits of product.5. Too little marketing support.6. Poor perceived prices/quality (value) relationship.7. Faulty estimates of market potential and other marketing research mistakes.8. Faulty estimates of production and marketing costs.9. Improper channels of distribution selected.10.Rapid change in the market (economy) after the product was introduced.

Some of these problems are beyond the control of management; but it is clear that successfulnew product planning requires large amounts of reliable information in diverse areas. Each

department assigned functional responsibility for product development automatically becomes an

input to the information system needed by the new product decision maker. For example, when afirm is developing a new product, it is wise for both engineers and marketers to consider both the

kind of market to be entered (e.g., consumer, organizational, international) and specific target

segments. These decisions will be of paramount influence on the design and cost of the finished

goods, which will, of course, directly influence, price, sales, and profits.

EXAMPLES:-

(1) Sony Betamax

The 1979 Betamax was a real breakthrough for its time and for the video recording business. Its

a shame it didn't catch on. Grandma must be pretty ticked off that all of her memories are trappedin a dead format.

Why it failed:Despite having higher quality (and a cooler name), Betamax was defeated by VHS when over 40

companies decided to run with the VCR-compatible format instead. The lower price of VHS-C

camcorders probably helped a little too.

(2) Coca Cola- New CokeBill Cosby, a soda can, and a crystal ball. Nope, nothing odd there. Is Bill Cosby really trying to

be believable?

Why it failed:There was nothing wrong with old coke. Life lesson: If it aint broke, dont fizz it.

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(3) Pepsi - Crystal PepsiWho knew that 15 years later Van Halen would be done with Sammy Hagar and bring back

David Lee Roth? Also, who knew we would live in a world without Crystal Pepsi? We were

pretty sure it was here to stay.

Why it failed:Similar to New Coke, there was no real need for Crystal Pepsi. Despite the shifting tides in early

90s marketing towards healthiness and purity, people just didnt get excited about a clear

caffeine-free Pepsi. Not really a surprise- those who were thatconcerned with the health and

color of their beverage probably would not be Pepsi drinkers to begin with.

(4) McDonalds - Arch Deluxe Burger.

Anytime you think the best way to market your product is by standing in an elevator in a chef's

outfit and begging the people on that elevator to eat that product...you might want to go back to

the drawing board.

Why it failed:The goal of the Deluxe line was to market McDonalds fine cuisine to the adult demographic.Unfortunately, adults werent interested in paying significantly more for slightly different

burgers.