Products

This composite new product development (NPD) framework for manufactured goods has eight important components:

Idea generation is the continuous and systematic quest for new product opportunities, including updating or changing an existing product.

Idea screening takes the less attractive, infeasible and unwanted product ideas out of the running. Unsuitable ideas should be determined through objective consideration.

Concept development and testing is vital. The internal, objective analysis of step two is replaced by customer opinion in this stage. The idea, or product concept at this point, must be tested on a true customer base. The testers' reactions can then be leveraged to adjust and further develop the concept according to the feedback.

Market strategy/business analysis is comprised of four P's, which are product, price, promotion and placement.

Product: The service or good that's been designed to satisfy the demand of a target audience.

Price: Pricing decisions affect everything; profit margins, supply and demand, and market strategy.

Promotion: The goals of promotion are to present the product to the target audience, increasing demand by doing so, and to illustrate the value of the product. Promotion includes advertisements, public relations and marketing campaigns.

Placement: The transaction may not occur on the web, but in today's digital economy, the customer is generally engaged and converted on the internet. Whether the product will be provided in bricks-and-mortar or clicks-and-mortar shops, or available through an omnichannel approach, the optimal channel, or channels, for placement must be determined if the targeted potential customers are to become actual customers.

Feasibility analysis/study yields information that is critical to the product's success. It entails organizing private groups that will test a beta version, or prototype, of the product, then evaluate the experience in a test panel. This feedback communicates the target market's level of interest and desired product features, as well as determines whether the product in development has the potential to be profitable, attainable and viable for the company, while satisfying a real demand from the target market.

Product technical design/Product development integrates the results of the feasibility analyses and feedback from beta tests from stage five into the product. This stage consists of turning that prototype or concept into a workable market offering; ironing out the technicalities of the product; and alerting and organizing the departments involved with the product launch, such as research and development, finance, marketing, production or operations.

Test marketing, or market testing, differs from concept or beta testing in that the prototype product and whole proposed marketing plan, not individual segments, are evaluated. The goal of this stage is to validate the entire concept -- from marketing angle and message to packaging to advertising to distribution. By testing the entire package before launch, the company can vet the reception of the product before a full go-to-market investment is made.

Market entry/commercialization is the stage in which the product is introduced to the target market. All the data obtained throughout the previous seven stages of this approach are used to produce, market and distribute the final product to and through the appropriate channels.