New Product Development Process

New product development is a process involving many stages of decision-making. Different experts advocate different phases. However, the following are the most common:

i.    Idea Generation—It is the first stage in the process. A pool of ideas is generated in the hope that it will be developed into a successful product. Since products are developed to satisfy consumer needs and wants, customers are a very important source of new product ideas.

Another important source of new product ideas are the company laboratories. Scientists while experimenting in laboratories may occasionally come up with very rich ideas.

Competitors are another source of new product ideas. Hence the firm evaluates and studies new products being introduced by competitors. The firms sales persons and dealers are also a possible source of good ideas. Because of their closeness to the market and the fact that they interact with actual and potential customers on a daily basis, sales people and dealers have a unique opportunity of identifying a gap in a product category (Kibera and Waruingi, 1988).
 
ii.    Idea Screening—The idea generation stage may yield thousands of ideas, some of which may not be worthwhile. Others may be so viable that they should be reviewed further. Idea screening is therefore the first phase of idea evaluation and pruning.

The pruning process involves the new product developer weighing his new product ideas against the following factors.

(a)    The extent of existing or potential demand for the new product if developed.

(b)    The extent to which the proposed product harmonizes with the existing marketing variables.

(c)    Durability of the product.

(d)    The extent to which the proposed product is in harmony with current production facilities, and

(e)    The long term expected sales growth of the proposed product.

        These factors can be reviewed to assess the various new product ideas.

iii.    Business Analysis—The new product developer is here concerned with projecting future sales, profits, rate of returns of the proposed new product and with determining whether these are in line with the company objectives.

iv.    Product Development—It is at this stage the firm tries to find out if the product is technically feasible. Brand name and packaging problems are also resolved here.

v.    Test Marketing—Test marketing entails introducing the product in a small scale and in a pre-selected environment to determine how customers react to it. If the reaction is positive then the new product developer can commercialize.

vi.    Commercialization—This means that the new product should now be introduced to the whole market. To successfully accomplish this, investing in new production equipment and facilities and developing a new marketing program may be necessary.