MarketingManagement.pdf

We will now look at the marketing challenges arising at each of the eight stages
of the development process: idea generation, idea screening, concept development
and testing, marketing strategy development, business analysis, product development,
market testing, and commercialization. A preview of the various steps and decisions
in the process is presented in Figure 2-1.

ANAGING THE DEVELOPMENT

PROCESS: IDEAS

IDEA GENERATION

The new-product development process starts with the search for ideas. Top managers
should define the product and market scope and the new product’s objectives. They
should state how much effort should be devoted to developing breakthrough prod-
ucts, modifying existing products, and copying competitors’ products. New-product
ideas can come from many sources: customers, scientists, competitors, employees,
channel members, and top management.
The marketing concept holds that customer needs and wantsare the logical place
to start the search for ideas. Hippel has shown that the highest percentage of ideas
for new industrial products originate with customers.^11 Technical companies can learn
a great deal by studying their lead users,those customers who make the most advanced
use of the company’s products and who recognize the need for improvements before
other customers do. Many of the best ideas come from asking customers to describe
their problems with current products. For instance, in an attempt to grab a foothold
in steel wool soap pads a niche dominated by SOS and Brillo, 3M arranged eight
focus groups with consumers around the country. 3M asked what problems consumers
found with traditional soap pads, and found the most frequent complaint was
that the pads scratched expensive cookware. This finding produced the idea for the

chapter 11

Developing

New Market

Offerings^335

1. Idea
   generation
   Is the
   particular
   idea worth
   considering?

Should we send the

idea back for product

development?

7. Market
   testing

No

6. Product
   development
   Have we
   developed a
   technically and
   commercially
   sound product?

No

5. Business analysis
   Will this product
   meet our profit
   goal?

No

4. Marketing
   strategy
   development

No No

1. Idea
   generation

Is the

idea worth

considering?

No

No

No No

Yes Yes Yes Yes Yes Yes

Yes

Yes

Yes Yes

Would it help to

modify the product or

marketing program?

2. Idea screening
   Is the product
   idea compatible
   with company
   objectives,
   strategies, and
   resources?

No

Lay

future

plans

DROP

8. Commercialization
   Are product sales
   meeting
   expectations?


9. Concept
   development
   and testing
   Can we find a good
   concept for the
   product that
   consumers say they
   would try?

Can we find a

cost-effective,

affordable

marketing

strategy?

Have product

sales met

expectations?

FIGURE 2-1

The New-Product-Development

Decision Process

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