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The Stages of Product Development Section 5.3 Stages of Product Development Marketers use inventions and innovations to create new products and make a profit. Sometimes the marketers and inventor are the same person – this is NOT common. They tend to sell or license their idea to a business Innovators are MUCH more likely to be marketers as well. Make current ideas/products better based on: • • • • Competition Changes in Culture/Society Technology Changing Demographics Baby Boom Era Stages of Product Development, Cont’d. Idea Generation Idea Screening Concept Development Market Strategy Feasibility Study Product Design Test Marketing Market Entry Idea Generation Research often indicates the need for a new product, or modifications to existing products Marketers will get together and brainstorm options/ideas for the creation/modification to the product. Idea Screening Once companies have brainstormed their ideas, they need to test both consumer reaction to the new idea as well as the competitive market for the new idea to see if it will be viable. EX: 1999 IncrEdibles Breakfast Sandwiches Concept Development If an idea is perceived as a good idea (both in the eyes of the consumer, and based on the current competitive market), a company will develop a working PROTYPE A small sample of what the product may actually look like and how it will operate. • The prototype is tested to see whether it will work and if consumers will like it. Market Strategy Using information already gathered (or from new research conducted) the marketing department would outline and study their primary and secondary market. Primary = Heavy USERS Secondary = Occasional Users Once the primary and secondary market is established, a strategy to reach them is prepared Feasibility Study A feasibility study is conducted (often at the same time as the market strategy) The product/business must be one that the business can make & sell. Product Design Takes into account the preferences/feedback of the primary market (as well as secondary market). Also includes: Package Warranty/Guarantees Instruction Manual(s) Service Information Test Marketing To test the viability of a new product/idea it must be tested in a sample market prior to market entry. Product is sold in a small area(s) that would be similar to the overall market. Market Entry At this stage the product enter the PLC: Introduction Growth Maturity Decline Decision Point