Product Idea Brainstorming

The first step is to generate an idea for the product. Ask employees, especially those who deal with

customers regularly, for product ideas. Survey customers for feedback on existing products.

Examine your industry to see whether there are areas where useful products do not exist. Create an

online survey for your customers or social media fans to take. List all ideas for a new product.

Evaluate the Ideas

Make a list of product ideas and share it with the appropriate decision-makers in the company, such

as the management team. Discuss the pros and cons of each idea and narrow the list to just a

handful of the best ideas, based on their potential to generate revenue, as well as the time and

resources you have to actually create the products.

Feedback and Market Evaluation

Seek feedback from customers, employees and partners on which idea is most appealing. Ask

customers for feedback via email or phone calls. Send an email to partners and employees and ask

which of the products seems most useful or valuable. Whittle the list to just one or two product ideas.

Using Social Media

Social media can be a powerful tool for soliciting feedback, as long as your are comfortable with

making your product idea public. If you have a strong presence on Facebook, Twitter or similar sites,

post descriptions or images of your concept and ask your visitors for comments or "likes."

Professional colleagues at business sites like LinkedIn can also be useful and knowledgeable

sources of input. You may even want to consider using social tools to raise funds for your project;

check into sites like KickStarter or Indiegogo to see if they fit your company objectives.

Analyze the Competitive Situation

Analyze the remaining product idea from a business perspective. Determine how much, if any,

competition exists for similar products. Determine the demand for the product, and estimate all costs

affiliated with the product, such as development costs and operational costs, to help determine the

profit margin.

Prototype and Marketing

Develop a prototype of the product, then share it with a handful of good customers and key partners.

Ask them to try it out and provide feedback. The marketing team should use that feedback to craft

marketing messages and developing marketing campaign ideas, such as email campaigns,

websites, billboards or posters. Base the marketing messages on the most common positive

comments or reactions from customers and partners during the prototype evaluation.

Market Testing

Make adjustments to the prototype or develop a new version, if necessary. Develop additional

prototypes for market testing. Do a small product release in select areas. See whether the product

sells well, and evaluate why sales are high or low.

Evaluate the price and the effectiveness of the marketing messages. A small launch helps determine

what needs to be done before an official launch.

Prepare for Launch

Begin production for the first round of the product launch. Evaluate how many products to produce

based on your market testing and demand for the product. Advertise and speak to product

distributors about ordering the product, if the product will be sold in stores.

1. Identify An Opportunity And Generate A New Idea To Fill It

If nobody wants or needs your product, it is bound to fail. The starting point
for all product development should be to analyze the needs of current and
potential customers, their levels of satisfaction with what the competition is
offering, their consumption habits and the technical possibilities for
improving existing products.

Managers with ample experience and a strategic vision of the company, the
competition, the clients and the suppliers are key to this process.

From the celebrity realm, consider Ferrán Adrià, chef and face of the famous
El Bulli restaurant. Adrià's method for generating new ideas called for
breaking down barriers between different groups in the creative team;
defining goals and deadlines; earmarking the money, time and human
resources needed; and documenting and analyzing the data obtained.
2. Measure The Opportunity

Once you've gathered information on market trends and your strategic

objectives, the next step is to analyze the segment or segments that the
product is geared toward and predict future buying habits as much as possible.

Product development tools (such as the Kano model) can help identify needs
and group them by established criteria.

3. Develop The Concept

In this phase, the new product idea is refined to best serve the needs of
potential clients and stand out from the competition.

How can this be achieved? Get opinions from leading users who may foresee
future needs in the market. Also, rely on a team with expertise in various
disciplines: design and production people for the technical requirements,
marketing experts for reaching customers, and finance and management
departments for determining what funds are available.

The three golden aims in this phase are to satisfy the client, stand out from the
competition, and show the greatest potential for turning a profit.

4. Testing, Testing....

Now you need to create your prototype and, essentially, assess how well it
performs. Does your product:

• Offer a series of features that satisfy customer needs?

• Arrive on the market at an opportune time?

• Perform efficiently with regards to development and manufacturing costs?

• Maintain a healthy equilibrium between the launch cost and the product's
capacity to turn a profit?

It's also good to keep in mind that investing in cost reduction early can
increase profitability. Cutting product prices can increase market share, which
in turn trims distribution costs and discourages the competition.
5. Position And Launch

With the product designed and studied thoroughly, the next step is to decide
on its strategic positioning. How do you want potential customers to perceive
the product? This stage needs to take into account economic, but also
functional and emotional factors.

Traditionally, functional innovations were emphasized in new products. But

this has become less sustainable in the current climate, as technology
advances allow competitors to respond and new innovations to enter the
market quickly. When price and features of rival products are similar,
differentiation is largely due to the emotional factor. This is at the heart of the
relevance of brand image, communication and the so-called intangible
attributes of a service or product.

Take Coca-Cola for example. Its advertising strategy has veered away from the
beverage's features, instead seeking to establish an emotional connection. Its
latest campaigns, "Open happiness" and "Taste the feeling" are right on-trend.

It's a competitive world out there. Planning carefully and remembering the
human factor can pay dividends when launching new products.

2.Market Orientation
Your market orientation analysis should guide you on how to meet the needs
and wants of your customers.

While your design team cannot dictate your company philosophy on

customers, it should influence this. But how do they do this? By conducting
an appropriate user research and an effective market research.

The market research should help you identify your customer/user needs and
how you meet them.
 3.Technology
Which technology are you planning to use in introducing the product to your
market? Is it compatible with the market?

It is imperative that you use a technology that your market can resonate
with. Whereas the design team may not have the final say on technology
budget allocation or appropriation, they should influence the choice of your
development team.

For instance, a multi-million dollar software or hardware requirement may

make your product inaccessible to small consumers. However, it may not be
an insurmountable hurdle for the large corporations.

Whenever you choose a technology, you need to have your end user in mind.

4.Knowledge Management
Different organizations in the present day value knowledge. They are willing
to protect it as a treasure. However, creating such a knowledge silo in a
company makes the knowledge ineffective.
The market research and analysis data will be helpful to your design teams.
But if the marketing team is hesitant to share the data, the entire company
will not benefit from its analysis. Your company should, therefore, work on
ensuring that any data and information is accessible by all.

5.The Development Strategies

How do you intend to achieve the overall goal of introducing a successful
new product for your market? Who is responsible for formulating and
implementing these designs?

The responsibility for drafting and implementing strategies is a shared goal between the development,
design and management teams. These parties should coordinate their activities to ensure there is
uniformity in their decision.

It’s worth noting that the final decision on the strategy to adapt lies with the product managers.

1. Discover details of your customers' unmet needs. You should develop a

set of interview questions, meet with these suffering customers in the

environment where they’re suffering, and listen to what they say when you

ask them the questions. Through this listening, you must discover more

details about the nature of their pain--and try to assess what kind of product

would encourage them to become customers.

2. Develop hypotheses. Using the observations of customer needs and your

vision of the technology, you should make educated guesses about the most

important product features likely to lead to wide customer adoption.

Moreover, you should make a numeric estimate of the number of customers

you thinks will use a prototype with those features.

3. Build a prototype solution. The next step is to develop a quick and

inexpensive prototype with those features. The first version is not likely to

meet the customer’s unmet need but it should help you get a better

understanding of what you need to do to close the gap between what the

prototype can do, and what the ultimate product will need to be able to do in

order to get the customer to buy it.

4. Test with customers. You must then give the prototype to customers and

observe how they use it. You should keep track of how many customers

actually use the product, and ask them what they like and don’t like about the

product. The general objective of this step is to learn and collect data that will

either confirm or disconfirm the hypotheses developed earlier.

5. Analyze variance. You should compare the expected outcome with the

observed results. This comparison will generate insights that shape your

strategic positioning.

6. Pick strategy. Better-than-expected results are likely to confirm that you

will gain market share if you turn the current version of the prototype into a
product and market it aggressively. If the results are worse than expected,

you must learn from what did not work and develop another prototype. And

you should iterate and test until observed results exceed expectations, or until

it becomes clear that it’s time to shut down the business.

1. Basic research using a SWOT analysis (Strengths, Weaknesses,

Opportunities & Threats)

A SWOT analysis is simply defined as a process that companies undertake to understand where
they are and then find ways to improve. In this process, the look for ways to build on their strengths,
minimize their weaknesses, maximize their opportunities, and snuff out threats from within and
without their organization.
In generating new product ideas through this means, emphasis is placed on the need to build on
strengths and make the most of opportunities.
In June 2002, Ben Horowitz began transforming Loudcloud, his application hosting service company,
into Opsware, a software company that offered products for servers and network devices, among
other things. This transformation was a product of necessity, in a bid to keep his company alive.
Loudcloud had been facing hard times so much so that the company almost started trading penny
stocks on the stock market. After looking at the situation at hand, and considering the strengths,
weaknesses, opportunities and threats that lay before the company, Horowitz took the bold step of
remodeling and re-presenting his company as a different product.
In 2007, Horowitz went on to sell Opsware to HP for $1.6 billion.

Click this link for examples of SWOT analysis: http://articles.bplans.com/swot-analysis-examples/

2. Market and Consumer Trends

Allan Gutterman, in his December 2009 publication, "Corporate Counsel's Guide to Management
and Administration", says that customers are the second leading source of new product ideas. He
explains that customers tend to suggest improvements and changes to existing products as opposed
to proposing totally new ones.
However, the smart business man will know how important it is to observe market and consumer
trends so as to know which product to remove, remodel or create. The inability to follow this simple
rule is what cost Kodak and Nokia their position as industry leaders. When digital cameras were
becoming a major trend, it would have been a smart move for Kodak to join in, or even to have
initiated the trend in the first place. But instead, the neglected the massive movement of people
towards digital cameras and today, they have lost their place to Canon, Nikon, Fujifilm, Olympus and
Sony, majority of which are Japanese companies.
As for Nokia, it is no news that they are no longer the biggest phone company in the world. They lost
their place to Samsung. All because they failed to move in time with the smartphone trend.

3. Company's R&D Department and Competitors

Another way to generate product ideas is by research & development, and studying competitors. In
the area of research and development, small business are likely not very strong as merely a handful
are able to afford the costs that R&D incurs. However, what small businesses can do is to read up
on the R&D escapades of the big companies and tailor some of these ideas to their own level. Also,
small companies can actually perform small scale customer and market research to generate new
product ideas and improvement strategies.
Frankly, some times, the easy thing to do is to look at what the competition is doing and copy or
improve upon it. This was a major step that Apple took with the iPod. Steve Jobs looked at the Sony
Walkman (which was the rave of the moment at the time) and improved upon it. This act is what
birthed the iPod, the iPod Touch, and now, the iPad. It worked for Steve Jobs, it can work for you
too.

4. Create Effective Customer Feedback Channels

As highlighted in number 2, customers are a very important factor in new product idea generation.
For a small business owner, the best way to get ideas from your customers is by walking up to them
and asking them to make suggestions based on their experiences with your business so far. You will
find out how eager many of them will be to talk to you because it will make them feel important, and
like a vital part of your progress.
Another way for small business owners to get feedback from customers is to provide channels for it,
e.g. feedback boxes, survey questionnaires, informal interviews, focus group discussions, etc. It will
amaze you how much these people will have to tell you. BMW knows how important customer
feedback is to its business. It created a Virtual Innovation Agency (VIA) to collect customer
feedback, in a bid to remain the "ultimate driving machine".

5. Employees

Honestly, I thinks are the most neglected source of new ideas, and Alan Gutterman says they are
the best source. Good companies value their employees input, and ask for it. the bad companies
usually don't. Some of the reasons why employee involvement in the idea generation process has
been on the decline include: negligence of top management, not giving credit to the employees who
deserve it, fear of intimidation and rejection, etc.
As an entrepreneur, you need to create an atmosphere where your employees will not be afraid to
make suggestions and propose good solutions and new ideas. HCL Technologies, the fourth largest
tech company in India has been able to generate $500 million from employees' ideas since 2008
when it started the "ideapreneurship" programme which encourages employees to come up with
innovative solutions to their customers' business challenges.

6. Trade Shows

This doesn't cost much, depending on the type of trade show. It is important to select the right trade
show. This will give you access to right people, right connections and you will gain new ideas, just by
looking around. If you are allowed, you could take photographs of products that interest you and are
relevant to your business.
Back in the university, we held regular trade fairs. I never bought things during these trade fairs, but I
would always move around to look at what people displayed. During my third year, I and some of my
classmates, opened our own trade fair joint. We called it 'The Calabar Kitchen' where we cooked
and sold locally made dishes from Cross Rivers state in Nigeria. It was my first and best
entrepreneurship venture and we made profit from it. In retrospect, one major factor that contributed
to the success of our venture was the knowledge and ideas I had gathered from scouting in previous
trade fairs.
It worked for me and I am certain it will work for you too.

Product Development: (EXISTING Market, NEW Product)

This involves developing new products for existing markets by
thinking about how new products can meet customer needs more
closely and outperform competitors. A prime example of this was the
launch of Cherry Coke in 1985 – Coca-Cola’s first extension beyond its
original recipe – and a strategy prompted by small-scale competitors
who had identified a profitable opportunity to add cherry-flavoured
syrup to Coca-Cola and resell it. The company has since gone on to
successfully launch other flavoured variants including lime, lemon and
vanilla.

Thirdly, the market development strategy entails finding a new group

of buyers for an existing product. The launch of Coke Zero in 2005 was
a classic example of this – its concept being identical to Diet Coke; the
great taste of Coca-Cola but with zero sugar and low calories. Diet
Coke was launched more than 30 years ago, and whilst more females
drink it every day than any other soft drink brand, it came to light that
young men shied away from it due to its consequential perception of
being a woman’s drink. With its shiny black can and polar opposite
advertising campaigns, Coke Zero has successfully generated a more
‘masculine’ appeal.
Product Development: New Products in Existing Markets

Product Development is about developing and selling new products

to existing markets. Companies could for example make some modifications in the
existing products to give increased value to the customers for their purchase or
develope and launch new products alongside a company’s existing product offering. A
classic example of product development is Apple launching a brand new iPhone every
few years. Other examples can be found in the pharmaceutical industry where
companies such as Pfizer, Merck and Bayer are heavily investing in Research and
Development (R&D) in order to come up with new and innovative drugs every now and
then.

1. Risk of major delays and economic costs due to belief that high
utilization of resources improves performance
According to surveys conducted in executive courses at the California Institute of
Technology, “the average product development manager keeps capacity utilization
above 98%.” That is, they fully utilize their product development resources. They do
so based on the belief that fully employed product development resources leads to
faster product innovation and launch.

An unintended consequence of such high utilization of resources, and one that

managers overlook, is major delays in product development. The authors argue that a
project’s speed, efficiency and output actually decline the more managers’ capacity is
being stretched across multiple development projects. This is largely due to the
realities of product development work – many aspects are unpredictable. The more
stretched the product development team, the less able they are to deal with managing
these unpredictable events.

The obvious solution to the aforementioned factors is to have a “capacity buffer in

processes that are highly variable.” In this way, queues and issues created can be
tackled and eliminated, thereby reducing the risk of major delays. It is also vital to
maintain resources for a particular project once it is started. To use the resources from
one project during its idle time to start another project can bring rise to the risk of
further delays and costs to the organization.

2. Increasing costs as a result of processing work in large

batches
Generally, it is assumed that processing work in large batches is cost-effective, faster,
and produces economies of scale. However, the authors believe otherwise, and claim
that “reduction of batch sizes is a critical principle of lean manufacturing.” With work-in-
process in product development being almost invisible, it is crucial to maintain
perspective and use smaller batches. This allows for quicker feedbacks and cost-
effective modifications.

What is an optimal batch size? This depends on two costs:

i. Holding costs – Costs associated with maintaining batches

ii. Transaction costs – Costs associated with processing batches

Large batches increase holding costs but decrease transaction costs and vice versa.
Hence, in order to avoid the risk of increasing costs, it is imperative to strike a balance
between the two costs. The authors mention a computer peripheral manufacturing
company that lowered its batch size and improved its efficiency by 220% (reducing
software testing from 48 to 2.5 months) and decreased defects by 33%.

3. Risk of losing opportunities by “sticking” to a single

development plan
Projects are intrinsically different and require a personalized planning and design
process. But organizations often like to stay within their comfort zone and place
“inordinate faith in their plans” believing that their development plan is the most
effective. Doing so can inadvertently cause organizations to develop a tunnel vision
towards product development that does not fit changing customer needs. Ultimately, it
will inhibit their ability to identify other opportunities for greater innovative techniques.

Constantly modifying the development plan to fit the needs of customers as it relates
to market demands will push managers to create unique designs and competitive
features that will make their product more attractive than other competitors. “Sticking to
the original” process may create the risk of producing similar products with little
significant improvements, and, therefore, the risk of losing a better opportunity.

4. Risk of starting a product development task too soon

Humans are often impatient and that characteristic naturally drives many organizations
to rush to embrace a new product development task. Anytime they experience
downtime, they often look for ways to utilize that time productively, sometimes
launching new product development projects too soon. Unfortunately that leads to
dilution of resources as other product development projects resume slowing down the
progress of the project launched during the idle time.

The authors emphasize the importance of controlling the rate at which they start new
projects so that they can carefully manage ongoing projects in process.

5. Risk associated with products having too many features

Products that are complicated to operate can quickly become unpopular in the market.
Such risks can cause a slump in sales. Hence, managers need to remind their teams
to develop products that are sophisticated, yet simple to use.

It can be difficult for a team to decide what features are relevant to the current product
development project. The authors provide a solution where the team can work on
identifying and eliminating features that are irrelevant. It is important to undergo this
process through the customers’ perspective. Once the omission process is completed,
then the team would be left with the most relevant ones to include and work with.
One company that the authors believe understands this idea is Apple. Apple’s
products, while sophisticated with latest software and features, are still user-friendly
and simple to use. This creates more demand for their product, and in turn higher
returns.

6. Risk arising from zero tolerance of failure with projects

Having a zero tolerance of failure can have a damaging effect to a product
development project. By communicating the expectations of success on the first
attempt of development work, project teams are more likely to choose the “least-risky”
solutions. These solutions may not be of much relevance to customers, and raise risks
of having an unattractive product in the market.

Early feedback and early testing of solutions with more experiments would potentially
mean more failures since more development work is needed. However, this can be
deemed positive since teams can identify the good options from the bad ones. Doing
this earlier on is encouraged rather than later when more resources have been
invested and the cost of backing out is higher.

A study of 391 teams that designed custom integrated circuits revealed that teams
who conducted early and frequent tests made more errors. However, they were able to
outperform other teams because the low initial cost of those several failures were
easier to recover than the high costs incurred by other teams. The timings of those
failures made a difference, and they avoided the risk of higher costs and product
failure with a point of lower or no economic return.