4 a) Discuss the stages in New Product Development process giving suitable examples
The new product development process has the potential to be haphazard because of the inherent uncertainty in the process, as well as the myriad methods available for product development. Setting up an organizing framework to identify the stages in the process, and the methods applicable to each stage, should help in bringing order to the process.
Our purpose in this article is to lay out a framework and identify key methods that are most likely to be useful in each stage. The focus here is on methods that use quantitative data collected mainly through the web thus bringing more validity and flexibility to the process along with speed to market. We envision the new product development process as an iterative multistage process as shown in Figure 1.
This is a straightforward way of looking at the process that starts with idea generation, moves to development of individual features and then to full product development and finally into product testing. Of course, this is one example of how the process can be viewed and not a rigid framework. There has to be considerable fluidity in the system to accommodate feedback, skipping of stages, use of new methods and perhaps introduction of new stages.
Idea Generation:
Many methods are available for the idea generation stage such as brainstorming, Delphi and focus groups. The basic approach is to harness creativity in some form for the development of new ideas. While there is much to recommend for the more qualitative approaches, one of the drawbacks is the lack of quantitative validity to the ideas at this stage. That is, the ideas have not been shown to have popularity in the constituency that matter – the customers. We have found that the Smart Incentives approach can provide both creativity and validation in the same step. Respondents to a survey compete with each other to produce ideas thus introducing creativity into the process. The generated ideas are then evaluated by a peer group to provide the required market validation. This approach can be useful for generating ideas on both whole products and individual features.
Feature Development:
Feature development is the process of identifying features that would be of interest to customers. Traditional methods such as Importance Scales can be used, but may not provide sufficient discrimination between features. Pairwise comparisons of features are a straightforward method for identifying feature importance. The task is simple, but can be tedious if a large list of features needs to be culled. More recently developed methods such as Max-Diff scaling can provide a better alternative. Max-Diff is similar to pairwise comparison, except that more than two features are evaluated at a time (3-5) and the most and least preferred alternative is chosen from each set. Some advanced statistical analysis on the back end provides a score for each feature that is generally more discriminatory than a regular importance scale.
Another alternative is the Kano
Product Development:
In this stage, combinations of features are used to build or evaluate the product. The Configurator allows survey respondents to build their ideal product by selecting from a list of available features. Usually prices are provided at the feature level to ensure that respondents make realistic decisions. As respondents build their own ideal products, the most popular features and feature combinations rise to the surface, resulting in the automatic development of preference based market segments. The Optimizer is different in that respondents make choices from among fully formed products. Information from their choices is taken into account in creating successive products that are more preferred till the process finally converges on the respondent’s ideal product. This method is more appropriate when the design and packaging (i.e. the visual element) is more important. As with the Configurator, the market segments itself into preference based segments.
The various flavors of conjoint (such as traditional, discrete choice, adaptive) can also be used in this stage to identify feature importance. But care has to be taken to ensure that the basic assumptions are met and that the right type of conjoint is used.
Product Testing:
Conjoint analysis can be fruitfully used in this stage also to estimate the interest in various product combinations and especially in running market simulations. The latter ability is very important in cases where a strong competitive market exists and reasonable estimates of take rates and ability to choose the ideal combination for the market are requisites. Concept testing is much more limited than conjoint and is usually used when the product is almost set except for perhaps one or two questions, often relating to price.
b) What is cyber marketing and how is it different from conventional marketing?
Discuss the limitations of cyber marketing.
Cyber marketing:
Cyber marketing has now become an indispensable segment of e-commerce as well as the internet and World Wide Web related topics. Cyber marketing simply refers to a technique of attracting potential customers by advertising your products or services through such means as websites, emails, and banners. In other words, cyber marketing is a blend of internet technology and direct marketing principles that is adopted by business owners to find profitable customers and to interact with them in order to enhance their business activities, thereby ensuring improved ROI (Return on Investment.) A number of activities are involved in cyber marketing such as online marketing, fax direct marketing, canvassing, call center direct marketing, and mobile phone marketing via SMS (Short Message Service.) However, it is not as easy you think to enhance your business profitability via cyber marketing techniques. In other words, in order to employ this marketing technique, it is important that business owners and other people engaged in the internet field such as ecommerce and marketing professionals must possess adequate skills.
Cyber marketing includes:
· E-Business technology
· E-Business Communication
· E-Business Distribution Systems
· E-Business Value Strategies
· E-Business Strategy
· E-Business Management
· Individual as well as the diffusion of innovations
· How to gather and use information
· The Political, Legal, and Ethical Environment
Limitations of cyber marketing:
Cyber marketing requires knowing beyond the means, methodology, and the other aspects of traditional marketing. The ever-changing and highly advanced technology of the internet requires technical knowledge too. Low speed internet connections might pose a difficulty for companies who would be using highly interactive and complicated websites which uses a lot of graphics, animation and audio. If individuals and potential customers are using dial-up connections or are accessing the internet through mobile devices, they may experience an inconvenient delay in content delivery aspect internet marketing is heavily relying on. They may not be able to fully appreciate the website and may opt to choose other providers. While comfort and convenience is the primary reason why most people are switching to transactions online, this aspect is worth noting.
Sometimes, error messages also appear. These websites which are overly complicated can have some bugs which can affect their overall internet marketing campaign.
While Cyber marketing cannot allow prospective buyers to touch, or smell or taste or 'try on' the products, internet marketing however provides some protection by offering a return policy on certain items. Either traditional or internet marketing, marketing does have its ethics to live by.
Cyber marketing not only serves their respective companies well, but also serves its customers by providing other information such as pick up services, or promos, and other 'come on' that puts them on a more advantageous edge over their competitors.
On the other hand, there are other executives who are not fully convinced of the advantages of internet marketing. They would cite inability to measure impact, lack of internal support and technical maintenance and challenge in seeking approval from higher management to pursue internet marketing.
Basically, except for the last one probably, these things are unfounded. With the database and system available online, Cyber marketing can even provide a venue for market research and analysis. They can gather information and data from their customers that cans serve as their reference for the study. They can also avail of outsourcing businesses to handle the technical infrastructure for them almost seamlessly.
May be the considerable challenge really lies on the preparedness of the company to launch a full blown internet marketing campaign. If they are not ready and launched an internet marketing program haphazardly, they can only experience complaints, which can eventually lead to poor reviews, thus, making its probabilities un-maximized.While Cyber marketing is very promising and has indeed produced good results already for many businesses around the world, some of the responsibility now lies with the people managing it. Just like any other type or marketing, they can put it to its maximum extent for productivity, or perform poorly by being mediocre.
While the products and pricing can really be an edge, convenience is every important for online businesses and internet marketing can do a lot to augment that. By being technically responsive to the needs of a typical online consumer, Cyber marketing can indeed be the turning point for any online business.
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