NEW PRODUCT LAUNCH

TRADITIONAL APPROACH NEW PRODUCT

DEVELOPMENT

Opportunity Identification
Go No
Analysis & Evaluation
No
Product Go
Develop Design& Development
ment
Funnel Go No
Market Testing
No
Go
Product Launch/Commercialization
Go No
Life Cycle management
Reposition
Harvest /Terminate
 NEW PRODUCT LAUNCH

 Product launch /
Commercialization follows after
the
- Design and
- Testing stage
 STEPS INVOLVED IN PRODUCT
LAUNCH
 Product Launch is undertaken after
successful design and testing, the steps
includes
* Gathering institutional recourses and
commitment necessary for successful
design ,tests and launch of the product.
* Undertake Preliminary market research
* Design Product prototype.
STEPS INVOLVED IN PRODUCT
LAUNCH

* Conduct pilot test.

* Develop Market strategy for successful
launch of new product and its ongoing
refinement.

* Understand the factors contributing to

successful product development.
 Product Launch and
Commercialization
 Commercialization begins with

* Determination of Market demand if

attractive .
* Mobilization of Internal Resources
- Followed by announcement of launch of
new Product which is done by slowly
scaling up until it is fully integrated in
the product line.
- It is also a True Test that the new
product is Client-Centered.
 Steps in Product Launch
 Finalize the Product including
component parts
 Develop a promotional strategy
 Determine the competitive
positioning and distribution channel
 Establish staff training courses and
incentive schemes and
 Shore of Technological
communication systems.
 Marketing / Commercialization
Strategy
 The Commercialization Strategy
revolves around the four Marketing
P’s, which are defined from the
Seller’s perspective.
 The Four P’s are designed to deliver
the benefits to the customer,
therefore required to be thought
about in a relation to four consumer
C’s
 Developing a Market Strategy

Four Marketing P’s Four Consumer C’s

 Product  Customer Needs and

 Price
wants
 Costs (opportunity
 Positioning
& Transaction costs) to
 Promotion Consumer
 Convenience
 Communication
 Marketing Strategy
1.Product Design
 Research into a design that will meet the
customer needs

 Involves component parts of the Product.

Core Product - The main benefits that the
customer expects from the product.
Actual Product - The specific terms & other
features that directly meet the customers
needs.
Augmented Product - Ancillary services,
which determine the accessibility of the
product.
 Marketing Strategy
2.Price
 Is a integral part of the product design
 The main components for pricing are
- Cost recovery
- Competitive Consideration
 Takes into account the following
- Cost of capital
- Cost of Product delivery
- Contribution to the fixed cost of an
institution, and
- Competitors
 Marketing Strategy- Price

* Cost Recovery
– The break even analysis approach is
used to recover the fixed costs of
delivering a product , based on the
value of sales the product must
generate.
 Marketing Strategy- Price

*Competitive Consideration
 Prices also Communicate Competitive
Strategy.
 High Prices are often associated with
better quality, superior customer
service and Presentation.
 Marketing Strategy- Promotion
3.Promotion

 Important Components of new

Product implementation.
 Primary means of Communicatining
its features ,building consumer
consciousness.
 Communicating the benefits of the
Product of the Target market.
 Marketing Strategy- Promotion

* Understanding Promotion
 If a circus is coming to the town and you
paint a sign saying” circus coming to the ..
Saturday” That’s advertising.
 If you put the sign on the back of the
elephant and then walk him into the town,
that’s Promotion.
 If the Elephant walks through the Mayor’s
Flower bed, that’s Publication.
 If you can get the mayor to Laugh about
it, that’s public relation.
 Marketing Strategy- Place

4.Place

 Refers to the Physical location

(distribution) of the Product.
 Positioning is the market relative to
its competing products.
 Marketing Strategy- Place
Distribution
 Based on costs and risks it may be
prudent to enter into partnership with
existing organization to provide access
to its new product.
Position
 Product placement is its competitive
position in the market.
 Preferring to reach many clients with
one or two products, rather that fewer
people with variety of products.
 Building institutional capacity
 Involves bringing about attitudinal shifts in
staff and upgrade to critical office system.

 The steps of institutional capacity building

involves
Human Resource development - buy in
training (specialized Vs generalist) and
incentives.
System build up - Management
information systems, quality control,
communications, etc.
 Building institutional capacity
* Human Resourses
 Preparing and motivating staff who
maintain the momentum of product
department mainly by training and
incentives.
 Training
- Established training program helps
resume product consistency & quality
control
- In deciding which staff to train, Institution
must analyze the benefits of employing
specialized versus generalist
 Human Resourses -Training

 Generalist  Specialist

- Leverage - Build client

underutilized relationships
- Capacity - Dedicated
- One Stop - Efficiency of
Shopping Specialization
- Avoid hierarchy
 Human Resourses
 Incentives

The characteristics of effective incentives

to promote new product will include:-
- Incentives should be Performance based
- Based on its priorities for a particular
stage of growth or marketing strategy.
- Straightforward & reinforcing complement.
- Balanced between individual & collective
goals.
- Aligned with institutional goals
 Building institutional capacity
 Systems buildup
- In preparing commercialization,
systems must be developed to
successfully support the expanding
product lines, by incrementally
building the capacity & managing a
commercialized new product.
 Systems buildup
 Some critical operational systems include
(a) Management Information System (MIS)-
including booking keeping, portfolio tracking,
budgeting & cost accounting- must
accommodate new product data, etc.
(b) Quality Control- For scaled-up product
implementation. Oversight in form of
portfolio receivers, performance evolutions
,periodic status checks etc.
(c) Communication- between Head office and
branches, management and staff, customers
etc..
 Case Study On
 New Product Launch
 Product –
Name
“A Household Lizard
Destroyer”
 AnInnovative Electrostatic
Device
 Introduction
 Apr 2003 -A new product called Lizard
destroyer for house hold use was
developed.
 It was developed as an innovative
electrostatic device.
 It was planned to be launched on 1st July
at 5 retail outlets in Singapore .
 The Co has low fixed cost ,low market exit
cost and positive flow forecast after
product introduction.
 The co is new and has no reputation in
house hold pests.
 Threats from depressed markets
caused by Economic down turn and
raw material supply from china was
the major cause of concern.
 The objective chosen was – Market
Penetration pricing. Cost estimation
based on competitors pricing and
company’s ROI objective.
 The product Life expected - 2 years.
 Stages of Product Life Cycle

 Introduction – 3 Months
 Growth - 6 Months
 Maturity - 2 Years
 Decline - 4 Years
 Features of the Product
 Risky & Expensive.
 Electrostatic Lizard Terminator.

 Adoption of new technology.

 First to enter Market.

 New Features to be added at later stage.

 Advertising, Promotion & Pricing to be

modified at maturity stage.
 Product to be developed at end of decline
stage.
 Market evolution

 Current market Latent.

 Two surveys of 100 homes done.
 20 Business owners shown interest.
 Competitors to enter market as market
grows.
 Product market share to be retained by
product innovation.
 At Maturity stage modified advertising,
promotion and pricing to retain the market
share.
 Challenges and Risks
 lessMarket information.
 Product performance.

 Costs strategy.

 Competition.
 Ideas
 Come from Customer.
 Customer Dismayed traditional
method of Lizard extermination.
 Six Methods were short listed.

 Ultrasonic, mechanical, electronically

and chemical devices were short
listed.
 Electrostatic ally was finally selected.
 Concept on strategy
 Prototype developed.
 Tested at various Locations.

 Prototype MK TO1-Effective but costly.

 Prototype MK TO2-Low Battery Life.

 Prototype MK TO4 – Economical but

unsuitable for commercial use..
 Market testing to be done after 1st stage.

 If successful than manufacturing

operations to expanded.
 Consumer Adoption
 To be displayed at Aisle position at
first five stores of cold storage.
 To be done for one month.
 Enlarged lizard kept at store to
attract customer interest.
 Market Mix to encourage customer to
buy products.
 Customer to recommend it to other
customers.
 Product Mix
 multiple benefits to customers.
 To exadicate Lizard Fasces from walls,
Ceiling, Floors and eradication of bacteria
there off.
 Battery Life 6 months.

 Augmented product to be introduced at

the start of the growth stage.
 Customer feedback to be taken for product
development in growth stage.
 Branding
 Trade name Liza Killa™ Product has been
Registered.
 Strategies instill the ides of affordable
effectiveness in the mind of the customer.
 Liza Killa™ identified by name.
 Our Logo Green lizard inside yellow circle
with a line through signifies absence of
Lizard.
 Brand equity to differentiate from
competitors.
 Customer complaints to be effectively dealt
with.
 Packaging
 Takes advantage of Rectangular shape.
 External surface are flat.

 All functional parts are contained within

the oblong housing.
 Product name, Logo and instructions
are all printed on the external surface.
 Cost effective clear cellophane paper
used for packaging.
 Organizational Mission &Corporate
Objectives

“ we serve our customers with quality

products which keep their homes free of
household pests, our customer benefits
from receiving the latest technology in
past extermination, devices at affordable
prices.”
 Current Marketing situations
 Current Market Size Estimated
800,000
 Potential Market obtained from
Survey 500,000
 Actual Market size considering
various factors 200,000
 Market expected to grow from1% to
4% and to reach Saturation level at
6%.
 Strengths
 Quality product & innovative design
 Shore delivery in time by dedicated
employees.
 Fully financed by share capital and
personnel financing.
 Cash flow forecast favorable.

 Company financially stable.

 Low fixed cost.

 Strengths
 Work force on renewal contract
 High assembly efficiency.

 Directors with good leadership and

success orientation.
 The Company knew the current
position of competitors with pricing
strategy & monthly demand.
 Weaknesses

 New Company and no track record.

 Promotion product through posting in
selective cold storage outlets only.
 Only 5 retail outlets used during
product launch.
 Limited output capacity.

 Work force on Contract Labour.

 Marketing Strategy

 Marketing penetration pricing strategy

used.
 Survival pricing not chosen because short
time oriented and not in favour of
company's expansion.
 Maximum current profit pricing not chosen
view market demand unknown.
 Market skimming précising not considered
view insufficient buyers with high demand.
 Marker penetration chosen as it will
simulate market growth required lower
cost & discourage competition.
 Controls
 Finally the Company adopted Sales,
Financial, and Personal control
procedures to keep program on
track.
 Identified any changes required
regarding product improvement,
production out put and workforce
requirement.