Perreault−McCarthy: Basic
Marketing: A
Global−Managerial
Approach, 14/e- Product Management
and New−Product
Development
Text © The McGraw−Hill
Companies, 2002298 Chapter 10
with e-mail or intranet sites, or perhaps via teleconferencing or some other tech-
nology. There are many ways to share ideas. So it isn’t sensible for a marketing
manager to develop elaborate marketing plans for goods or services that the firm
simply can’t produce—or produce profitably. It also doesn’t make sense for R&D
people to develop a technology or product that does not have potential for the firm
and its markets. Clearly, a balancing act is involved here. But the critical point is
the basic one we’ve been emphasizing throughout the whole book: marketing-
oriented firms seek to satisfy customer needs at a profit with an integrated, whole
company effort.Developing new products should be a total company effort. The whole
process—involving people in management, research, production, promotion,
packaging, and branding—must move in steps from early exploration of ideas to
development of the product and marketing mix. Even with a careful develop-
ment process, many new products do fail—usually because a company skips some
steps in the process. Because speed can be important, it’s always tempting to skip
needed steps when some part of the process seems to indicate that the company
has a “really good idea.” But the process moves in steps—gathering different
kinds of information along the way. By skipping steps, a firm may miss an impor-
tant aspect that could make a whole strategy less profitable or actually cause it
to fail.
Eventually, the new product is no longer new—it becomes just another prod-
uct. In some firms, at this point the new-product people turn the product over
to the regular operating people and go on to developing other new ideas. In
other firms, the person who was the new-product champion continues with the
product, perhaps taking on the broader responsibility for turning it into a suc-
cessful business.Need for Product Managers
A complicated,
integrated effort
is needed
Product variety leads
to product managers
When a firm has only one or a few related products, everyone is interested in
them. But when many new products are being developed, someone should be put
in charge of new-product planning to be sure it is not neglected. Similarly, when a
firm has products in several different product categories, management may decide
to put someone in charge of each category, or each brand, to be sure that attention
to these products is not lost in the rush of everyday business. Product managersor
brand managersmanage specific products—often taking over the jobs formerly han-
dled by an advertising manager. That gives a clue to what is often their major
responsibility—Promotion—since the products have already been developed by the
new-product people. However, some brand managers start at the new-product devel-
opment stage and carry on from there.
Product managers are especially common in large companies that produce many
kinds of products. Several product managers may serve under a marketing manager.
Sometimes these product managers are responsible for the profitable operation of a
particular product’s whole marketing effort. Then they have to coordinate their
efforts with others—including the sales manager, advertising agencies, production
and research people, and even channel members. This is likely to lead to difficul-
ties if product managers have no control over the marketing strategy for other
related brands or authority over other functional areas whose efforts they are
expected to direct and coordinate.
To avoid these problems, in some companies the product manager serves mainly
as a “product champion”—concerned with planning and getting the promotion
effort implemented. A higher-level marketing manager with more authority