New Product Development (NPD) is a multi-stage process that transforms ideas into market-ready products. It includes idea generation, screening, concept development, consumer testing, marketing strategy formulation, business analysis, prototyping, market testing, and finally, product launch. The text also discusses the agile product development approach, using Netflix's strategic evolution as an example of adapting to market trends and consumer preferences for sustained success.
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Ideas for new products can come from internal brainstorming sessions, customer feedback, market research, and competitor analysis
The goal of idea generation is to compile a diverse set of potential product concepts
Idea generation is a creative phase where numerous product concepts are proposed
A cross-functional team assesses ideas against criteria such as unique selling proposition, market size, pricing strategies, development costs, manufacturing feasibility, and return on investment
Idea screening is crucial to avoid the high costs associated with developing non-viable products
The goal of idea screening is to narrow down the list of ideas to identify the most promising ones
Selected ideas are expanded into detailed product concepts during this phase
Product concepts are tested with target consumers to assess their reactions and potential market demand
Concept testing can take various forms, from simple surveys to more sophisticated market studies
Once a product concept is validated, a marketing strategy is crafted, including defining the target market, value proposition, and financial goals
A marketing strategy typically includes pricing, distribution channels, promotional plans, and long-term objectives
A robust marketing strategy is crucial for the successful launch and promotion of a new product
A thorough business analysis is conducted to ensure the product concept and marketing strategy are economically viable
Business analysis may include market testing, reviewing sales data, and estimating market penetration to evaluate potential success and risks
The product development phase begins once the business analysis indicates economic viability
Research and Development teams work to transform the product concept into a physical prototype
The product development phase includes designing, developing, and refining the prototype to meet consumer expectations and be manufactured at scale
The duration of the product development phase varies based on the product's complexity and available resources
Test marketing allows for the evaluation of the product and marketing strategy in a controlled market setting
Test marketing provides valuable insights into consumer response and helps fine-tune the marketing approach
The scale of test marketing can range from small pilot launches to larger, more comprehensive market tests
Commercialization is the final stage of the NPD process, where the product is officially introduced to the market
Commercialization involves significant investment in production, marketing, and distribution infrastructure
The timing of the product launch may be influenced by strategic considerations such as seasonality and the competitive landscape
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NPD first phase after idea generation
Idea screening - filtering concepts to spot viable options.
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Sources for NPD idea generation
Brainstorming, customer feedback, market research, competitor analysis.
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During the ______ phase, a cross-functional team evaluates ideas to pinpoint the most promising ones, using criteria like unique selling proposition and market size.
idea screening
