New products management
C. Merle Crawford & C. Anthony Di Benedetto
Eleventh Edition – International Student Edition
Chapters 1 – 19
Copyright – SE Stalpers
,List of Contents
Part I – Overview and opportunity identification/selection ................................................................... 3
Chapter 1: The strategic elements of product development ............................................................. 3
Chapter 2: The new products process ................................................................................................ 6
Chapter 3: Opportunity identification and selection: strategic planning for new products .............. 9
Part II – Concept generation ................................................................................................................. 13
Chapter 4: Creativity and the product concept ................................................................................ 13
Chapter 5: Finding and solving customers’ problems....................................................................... 16
Chapter 6: Analytical attribute approaches: introduction and perceptual mapping ....................... 18
Chapter 7: Analytical attribute approaches: trade-off analysis and qualitative techniques ............ 20
Part III – Concept/Project evaluation.................................................................................................... 23
Chapter 8: The concept evaluation system ...................................................................................... 23
Chapter 9: Concept testing ............................................................................................................... 26
Chapter 10: The full screen ............................................................................................................... 29
Chapter 11: Sales forecasting and financial analysis ........................................................................ 31
Chapter 12: Product protocol ........................................................................................................... 33
Part IV – Development .......................................................................................................................... 35
Chapter 13: Design ............................................................................................................................ 35
Chapter 14: Development team management ................................................................................. 38
Chapter 15: Product use testing ....................................................................................................... 40
Part V – Launch ..................................................................................................................................... 42
Chapter 16: Strategic launch planning .............................................................................................. 43
Chapter 17: Implementation of the strategic plan ........................................................................... 46
Chapter 18: Market testing ............................................................................................................... 48
Chapter 19: Launch management..................................................................................................... 51
2
,Part I – Overview and opportunity identification/selection
Chapter 1: The strategic elements of product development
In this book new products management is described and adopted is the viewpoint of the marketing
manager; that is, we are primarily concerned about the specific role for marketing in the overall task.
The importance of new products
Managers realize that radical innovation is critical to future growth and even the survival of the firm.
Here, we are defining radical innovation as innovation that displaces or obsoletes current products
and/or creates totally new product categories. The reason firms invest this much in new products is
that they hold the answer to most firms’ biggest problems. Competitors do the most damage when
(1) there is so little product differentiation that price-cutting takes everyone’s margins away or (2)
when they have a desirable new item that we don’t. The fact is: A successful new product does more
good for a firm than anything else that can happen.
Globalization and new product development
Like all aspects of modern business, product development has become more challenging due to
increased globalization. Now, many firms look overseas not just to access a cheaper labour force, but
to access the talent residing in these markets and the ideas generated by these skilled personnel.
Another reason for increased R&D is the increasing globalization of the innovating firms themselves.
The best research available on this topic finds that firms with a global innovation culture have the
most effective global new product programs. 12 Having a global innovation culture means that a firm
is open to global markets, mindful of differences in customer needs and preferences, and respectful
3
, of different national cultural and business environments. A firm with a global innovation culture is
better at integrating its global knowledge, can better manage the R&D tasks associated with the new
products process, and has an advantage in implementing global launches.
How product development is different
The new products team ideally is cross-functional, comprising personnel from marketing, R&D,
engineering, manufacturing, production, design, and other functional areas as well. Above all else,
product development is a joint effort. This course of study calls for a strong creative contribution . Not
only do we create new product concepts; in many firms, that’s easy. The tough creativity is how best
to develop and market them. Being creative means we travel on unmarked roads. We use heuristics
— rules of thumb that firms have found work for them. We are dealing with people under intense
pressure, making tough decisions under impossible conditions.
The term process innovation usually applies to functions, especially the manufacturing or distribution
process, and every new product benefits from this type of innovation. The term product innovation
applies to the total operation by which a new product is created and marketed, and it includes
innovation in all of the functional processes. Sometimes the new product process is accidental, or
serendipitous.
What is a new product and what leads to success?
The term new product can mean different things to different people. Figure 1.3 shows that new
products can include new-to-the-world (sometimes called really new) products, as well as minor
repositionings and cost reductions.
Generally, if a product is new to the world or new to the firm (the first two categories), the risks and
uncertainties faced by the firm are higher, as are the associated costs of development and launch.
New-to-the-world products revolutionize existing product categories or define wholly new ones. They
are the most likely to require consumer learning and/ or incorporate a very new technology.
4
C. Merle Crawford & C. Anthony Di Benedetto
Eleventh Edition – International Student Edition
Chapters 1 – 19
Copyright – SE Stalpers
,List of Contents
Part I – Overview and opportunity identification/selection ................................................................... 3
Chapter 1: The strategic elements of product development ............................................................. 3
Chapter 2: The new products process ................................................................................................ 6
Chapter 3: Opportunity identification and selection: strategic planning for new products .............. 9
Part II – Concept generation ................................................................................................................. 13
Chapter 4: Creativity and the product concept ................................................................................ 13
Chapter 5: Finding and solving customers’ problems....................................................................... 16
Chapter 6: Analytical attribute approaches: introduction and perceptual mapping ....................... 18
Chapter 7: Analytical attribute approaches: trade-off analysis and qualitative techniques ............ 20
Part III – Concept/Project evaluation.................................................................................................... 23
Chapter 8: The concept evaluation system ...................................................................................... 23
Chapter 9: Concept testing ............................................................................................................... 26
Chapter 10: The full screen ............................................................................................................... 29
Chapter 11: Sales forecasting and financial analysis ........................................................................ 31
Chapter 12: Product protocol ........................................................................................................... 33
Part IV – Development .......................................................................................................................... 35
Chapter 13: Design ............................................................................................................................ 35
Chapter 14: Development team management ................................................................................. 38
Chapter 15: Product use testing ....................................................................................................... 40
Part V – Launch ..................................................................................................................................... 42
Chapter 16: Strategic launch planning .............................................................................................. 43
Chapter 17: Implementation of the strategic plan ........................................................................... 46
Chapter 18: Market testing ............................................................................................................... 48
Chapter 19: Launch management..................................................................................................... 51
2
,Part I – Overview and opportunity identification/selection
Chapter 1: The strategic elements of product development
In this book new products management is described and adopted is the viewpoint of the marketing
manager; that is, we are primarily concerned about the specific role for marketing in the overall task.
The importance of new products
Managers realize that radical innovation is critical to future growth and even the survival of the firm.
Here, we are defining radical innovation as innovation that displaces or obsoletes current products
and/or creates totally new product categories. The reason firms invest this much in new products is
that they hold the answer to most firms’ biggest problems. Competitors do the most damage when
(1) there is so little product differentiation that price-cutting takes everyone’s margins away or (2)
when they have a desirable new item that we don’t. The fact is: A successful new product does more
good for a firm than anything else that can happen.
Globalization and new product development
Like all aspects of modern business, product development has become more challenging due to
increased globalization. Now, many firms look overseas not just to access a cheaper labour force, but
to access the talent residing in these markets and the ideas generated by these skilled personnel.
Another reason for increased R&D is the increasing globalization of the innovating firms themselves.
The best research available on this topic finds that firms with a global innovation culture have the
most effective global new product programs. 12 Having a global innovation culture means that a firm
is open to global markets, mindful of differences in customer needs and preferences, and respectful
3
, of different national cultural and business environments. A firm with a global innovation culture is
better at integrating its global knowledge, can better manage the R&D tasks associated with the new
products process, and has an advantage in implementing global launches.
How product development is different
The new products team ideally is cross-functional, comprising personnel from marketing, R&D,
engineering, manufacturing, production, design, and other functional areas as well. Above all else,
product development is a joint effort. This course of study calls for a strong creative contribution . Not
only do we create new product concepts; in many firms, that’s easy. The tough creativity is how best
to develop and market them. Being creative means we travel on unmarked roads. We use heuristics
— rules of thumb that firms have found work for them. We are dealing with people under intense
pressure, making tough decisions under impossible conditions.
The term process innovation usually applies to functions, especially the manufacturing or distribution
process, and every new product benefits from this type of innovation. The term product innovation
applies to the total operation by which a new product is created and marketed, and it includes
innovation in all of the functional processes. Sometimes the new product process is accidental, or
serendipitous.
What is a new product and what leads to success?
The term new product can mean different things to different people. Figure 1.3 shows that new
products can include new-to-the-world (sometimes called really new) products, as well as minor
repositionings and cost reductions.
Generally, if a product is new to the world or new to the firm (the first two categories), the risks and
uncertainties faced by the firm are higher, as are the associated costs of development and launch.
New-to-the-world products revolutionize existing product categories or define wholly new ones. They
are the most likely to require consumer learning and/ or incorporate a very new technology.
4
