Developing New Products
Need to develop new products. A new product can be:
Continuous Innovation...No new buyer behavior to learn, i.e. -products not previously marketed by the firm, but by others
Dynamic Continuous Innovation...minor education needed for consumers to adopt product
Discontinuous Innovation...entirely new consumption patterns
DVD Standard
DVD Association
Discussion Topic: Discuss the evolution of the DVD standard and its importance in new product development.
For a new product to succeed it must have:
desirable attributes
be unique
have its features communicated to the consumer (mkt support necessary)
Developing new products is expensive and risky.
Failure not to introduce new products is also risky. IE Timex above
Firms develop new products in three ways:
By acquisition, i.e. Timex bought Guess and Monet Jewellers in 1992, bringing in new products to their product mix.
Acquiring patents, licensing technology
Internal development, this is what we are going to focus on.
About 20K new products a year launched: about 75% are brand extensions.
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