Before you develop a new product for your company, you need to understand the stages involved in the new product development process.
The development of a new product will start with idea generation. This involves the search for new product ideas systematically. The first source is internal sources where the company gets ideas from within the company including from employees. Apart from the internal sources, the company may get new product ideas externally from distributors and suppliers as well as customers.
When the company has identified potential ideas for new products, the next step is idea screening. This is an important step that ensures only good ideas are selected and the bad ones are rejected. Besides, the purpose of this stage is to reduce the number of ideas as this can be costly in the later stages. When screening out the ideas, things like ROI, market potential and affordability of the product are considered.
The third stage in new product development process is concept development and testing. The new product idea is converted into a concept that consumers will be able to understand. This way, the consumers can be able to perceive the product and give their reaction. The detailed version of concept provided will help consumers have an idea of what the actual product looks like. Besides, the concept testing can either be done symbolically or physically.
After testing the concept and analyzing whether consumers need or want the product, the step that follows is the marketing strategy development. This step involves designing the market strategy that will used to introduce the product into the market. It involves three stages which are; a description of the target market, the products planned price and the profit goals as well as marketing mix strategy to be used.
The fifth step in the new product development process is the business analysis. This step involves determining whether the new product will be profitable by reviewing the costs, sales and profit projections. In order to know the sales f the new product, the company can look at the sales history of similar products or conduct a market survey.
When the product has passed the business test, it goes to product development stage. The business concept is developed into an actual product that can be tested by consumers. The second last step in the new product development process is test marketing. The whole concept is for the marketer to have to have an experience of testing the product.
The final stage in the new product development process is commercialisation which involves introducing the product into the market. In this stage, a lot of money is spent on advertising, sales promotion, and renting a manufacturing facility. The company should come up with a good location to launch the product to attract potential customers.