Mention the stages in new product development.

Ans.

Stages in New Product Development

The process of new product development goes through following stages:

1. Exploration – The first stage begins with imagination of the product idea which may originate by the consumers, dealers, in company resources including market research group. According to Philip Kotler, “a product idea is a possible product the company might offer to the market.”

2. Screening – The idea at this stage is subjected to severe screening to find out if the necessity of a new product is really felt. It is also evaluated if the proposed new product may be included in the existing product line without creating any financial or marketing complications.

3. Business Analysis – At this stage it is decided if the project is worth proceeding to from marketing and financial point of view.

4. Development – Upto this stage the idea has remained on paper now it takes the shape of a commitment. The final decision is now taken if the new product should be developed or not. At this stage production and marketing both are involved in deliberations. It is now finally decided that the product may be developed on a commercial scale.

5. Testing- Some tests are conducted to ensure the acceptability of product. These tests are actually the risk control tools. Three types of tests are mostly conducted:

(a) Concept Contesting- The concept of the would-be-product is carried by market research instruments to the consumer groups. Their views and suggestions are invited. If the response is encouraging it is presumed that would-be-product has passed the test.

(b) Product Testing- After the success of concept tests the real product is sent to few selected markets for opinion forming. It gives an idea to the management about the likes and dislikes of the consumers for the product.

(c) Test Marketing- This test actually is the test of total marketing mix. The new product with the support of chosen marketing mix is launched in selected market which is presumed as the representative of total market. It is a time consuming method.

6. Commercialisation – At this stage the firm decides to go on large scale manufacturing and marketing of the product.

All the above stages go to prove that development of a new product must pass through different stages to ascertain the prospects of a new product and to avoid possible risks involved.

It is now obvious that new product development is an expensive, time consuming and risk taking job. Organisations that can afford to absorb the shocks arising one of the factors coming in between can take up introduction of new products as and when they feel it necessary to do so.