Concept of New Product
Generally the unacquainted product in market is called new product. Such product should contain one or the other newness in its quality. Since all kinds of products found in market cannot survive for ever, new products appear. So, there remains possibility of continuous development of new products. |
Marketing experts and writers have defined new products to make clear the meaning of new products. Important definitions are as follows:
According to Prof. Philip Kotler, “New products include original products, improved products, modified products and new brands that the firm develops through its own research and development efforts.”
According to Prof. William J. Stanton, “If buyers considers to significantly different from competitive products in some relevant characteristics then it is indeed a new product.”
Any product comes that first in market is called new product. A company or firm can bring product into market by adding new features and quality to the old ones. To produce new improved goods after scanning environmental factors by business organizations or firms is to develop new products. The above mentioned definitions also make it clear that inventing, modifying or imitating in products is to develop new product. In fact, new technology, competition, customers’ changed wants and changes in other environmental factors compel to develop new products. This task plays an important role for the success of each firm or business company.
Types of New Product
There are many technologies to invent products. Firms or business organizations can bring new products of different nature and quality to market by using new technologies. So, new products also can be classified into different groups. They are as follows:
1. Innovative Product
The product got as a fruit of study, research and invention is called innovative product. Other products to substitute such products cannot be found in markets. So, these products are also called original products. Such products greatly help to meet the new wants of customers. A long time, labor and brain need to spend on the development of such products. So, only economically capable producers and skilled researchers can jointly complete such task. Then the newly invented products are supplied to markets to satisfy customers.
2. Modified Product
If more useful products than those available are brought out in market as alternative, they are called modified products. In such products, some newness can be found. The products can be modified by changing color, design, feature, package, brand name etc. to give newness. In this way, modified products can be brought in markets adding some quality and features. Such products become different in quality and feature from the old ones. In other words, difference in nature, shape, quality, size etc. than already available products in modified product.
3. Imitative Product
To produce similar products by imitating the products of other companies or business organizations is called imitative product. Even if same types of products have already come into markets, imitative products become new for the imitator company. Such products are produced because of long lasting and high demand in markets. Such imitative goods are produced with the hope that can control target market and meet high demand of the customers.
Need for Product Innovation
Wants, living standard, interest and needs of different consumers’ groups may change after certain time duration. Original products are needed to satisfy their wants. Such products should include new quality, features, new size, shape and design. Such products are searched to meet the demand, want and need of target markets. This becomes possible only through research, analysis and study. The importance and need of innovation of new product can be mentioned as follows:
1. Technological Mapping
Technological mapping is prepared by experts of special arts and knowledge. They can give suggestion about change of size, shape, quality, feature etc. Accordingly business firms invent new products. This creates need and importance of new products.
2. Environmental Change
Business firms are influenced/ affected by political, economic, cultural and natural environmental factors in every society. Such factors compel business firms to invent new products, due to which the firms need to change and develop products.
3. Competitive Activity
The modern business firms should pay special attention to competition. Those firms which cannot face competition cannot be long lasting. The business firms which wish to live long should carefully research and study it. Only after having careful research and study of competitors, new goods should be developed.
4. Market Leadership
Renowned/ respected business firm should take leadership in market. So, such firms should develop and invent new products. For this, study and researches are also necessary. Big firms can invest sufficient capital in such task. As a result, new products appear in markets. Hence, the consumers can get opportunity to use wanted goods.
5. Changing Activity of Customer Group
Wants, interest, needs and priorities get changes time to time. Their wants, interest, priority and needs should be accepted by business firms through researches and studies. On the basis of the same, products should be given new shape and size. The business firms can get success only after such new products enter into markets. In this way the need, wants and importance are reflected in them.
6. Failure of Existing Products
The product which has entered in any stage of its life cycle may get failure. The products may get failure due to weakness in feature and quality. They may disappear from market being unsuccessful in competition. So, there are many reasons of failure of products, due to which new development and invention is compulsory.
Reasons for Product Failure
New goods are produced with the intention that they should remain for long in market. Even then there remain possibilities of failure. Products may be unsuccessful for uncontrollable reasons. Similarly, due to lack of effective control by the firm, products may get failure in the target market. The main reasons for the failure of new products are mentioned as follows:
1. Poor Quality
Most of the customers want to use quality products. If any product with low quality, less utility and feature entered into market, the customers do not accept it. In such situation, the marketed product gets failure.
2. Strong Competition
The producer should fiercely compete with competitors in market. The company which becomes unsuccessful in competition cannot stay in market and its product disappears from the market. In this way, the product which cannot maintain its market gets failure. So, fierce competition is one of the reasons for the failure of any product.
3. Government Regulations
Government of every country tries to keep control over every product. Quality, feature, level of products and social interest are determined by the regulations. If any product comes in market against the regulations, government puts restrictions and keeps control over the products. In such situation, the marketed products become unsuccessful.
4. Poor Technology
The shape and size of the new products should be according to the demand of the customers. If they do not find products as they have wanted, they do not accept. In this way, products become unsuccessful in target market due to use of weak technology.
5. Price of the Products
Price of the products should be fixed rationally. Both high and low prices may be harmful. Customers do not easily accept both the prices. So, due to irrational pricing, products may be unsuccessful in target market.
6. Cost of Products
Investment should be made on researches and study for production of new goods. In this way, production price is high. It also directly affects price of the products. Such negative effect makes difficult to increase sale quantity. So, extra investment also becomes the sixth reason for the failure of products.
7. Market Sector
If the sector of new products becomes narrow and weak, it cannot expand. Similarly, if the target is broken, new products cannot be successful. On the other hand, if the market segment is wrongly selected, new products cannot get success.
8. Poor Management
Management aspect of business company should be very strong and effective. The management should pay attention to all the production affairs from arrangement of raw materials to the marketing new finished products. But implementation aspect of management becomes weak, new product becomes unsuccessful. In such situation, product distribution, advertising, promotion etc. cannot be effective due to which even marketed goods get failure.
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