INTRODUCTION
New product or service development is a technique which is used by various companies in order to maximise their profits and sales by modifying existing products or services. This decision is taken by the management when company is not able to grab attention of customers, NPD (New product development) will help to attract large number of people with a new and modified idea (Stark, 2015). Company chosen for this project report is Amtek Plastics UK Ltd.
This project report covers topics like explanation and application new product or service development process, levels of customer’s integration, life cycle stage and appropriate product line management choices that are required for product or service.
TASK 1
P1 Process of development of product or service and levels of customer’s integration
New product development process: While a company is planning for new product or service development than it is essential to follow the process of new product development so that plan can be executed appropriately. For example, if Amtek Plastics UK Ltd is willing to launch a new product to acquire more market share than it is vital for the organisation to follow the process of development to reach the objective. The process if as follows:
- Idea generation: It is a process in which new ideas are generated by employees of organisation. It can be created by brainstorming in which various persons sit together and provide ideas in order to enhance performance of company (Stages of New product development process, 2018).
- Idea screening: This process helps to evaluate innovative and specific idea from different ideas that are received from different employees of the organisation. This also assist or guide the planner to make amendments in the product required as per market trends through the peer-review procedure and aid in understanding the drawbacks.
- Concept development and testing: In this stage target market, marketing details, product's features, benefits and other factors are discussed so that a proper idea can be implemented.
- Marketing strategy and development: This stage is mainly related to the implementation of marketing strategies in which it is described that where the product is going to be introduced and in which way this will be marketed.
- Business analysis: It includes development of different aspects such as market size, its structure, positioning, pricing and distribution strategies, and a detailed description of sales and profit related goals.
- Product development: It is almost same as actual product development, but it is based on new concept rather than old one. It consists the new feature or an advantage which is going to be involved in product to attract more customers.
- Test marketing: In this stage market settings are analysed that helps marketer to experience market conditions before launching product. It facilitates managers while selecting target market.
- Commercialisation: It is the last stage of new product development process in which important information is gathered from various sources, which is required to make final decision. In this phase, company needs to spend higher amount on advertising, sales promotion and other marketing practices which can help to grab attention of customers.
Levels of customer integration: It is mainly related to customer relationship management that allows customers to process their transactions and be in direct contact with organisation. For example, if Amtek Plastics UK Ltd is launching a new product than it is very important for company to follow all levels of customer integration which will help to attract more customers and establish good relation with them (Tukker and Tischner, 2017). These stages are explained below:
- Single customer interaction: It refers to the communication with individual customers so that they get aware about the new product which is going to be launched by Amtek Plastics UK Ltd. This type of interaction is very important as it can help to take feedback from each customer separately.
- Ongoing customer dialogue: This is a process of continuously be in touch with customers after selling the product. This will help to establish good relations with them.
- One-time information retrieval pure observation: While taking feedbacks from customer’s company should focus that it is not disturbing customers by again and again asking for feedback.
- Ongoing online community monitoring: If the organisation is introducing a new concept in the market than it should always monitor its online community to gather exact data and reviews of customers. This monitoring can help to enhance the performance level (Marques and et. al., 2013).
P2 Use of process in application of development of specific product in an organisation's context
All the product development process's steps need to be followed by the organisation who is willing for product development. The example which is taken in above question in which Amtek Plastics UK Ltd is thinking for new product development such as “Temperature adjustable plastic glasses and bowl”. For this purpose, the organisation needs to follow all the steps involved in the process.
For this purpose, the organisation needs to get various innovative ideas from various individuals who are working in Amtek Plastics UK Ltd. When different innovative ideas are received from employees than managers need to select the best idea to implement. For example, the idea which has been selected is to modify their old plastic wastes with such type of injection that can be used more than one time and which is eco-friendly, this can help the customers to save their money and also help to reduce the use of plastic products like temperature adjustable glasses (Cavalieri and Pezzotta 2012). Now, the management of the company needs to decide marketing strategies and analyse business marketing mix for their innovative products can easily be implemented into the market. In product development, company needs to implement the concept which is selected from ideas of employees. At last, Amtek Plastics UK Ltd needs to analyse all the marketing settings and other functions such as advertising, sales promotions that are part of commercialisation. All these steps can help Amtek Plastics UK Ltd to execute the plan for developing latest Temperature adjustable glasses and bowl. It will be effectively useful for them to attain their aims and objectives more quickly.
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TASK2
P3 Assessment of life cycle stage of product or service
Life cycle stages: It is a combination of four different stages that are faced by every product in its life time. As Amtek Plastics UK Ltd is launching “Temperature adjustable glasses and bowl” and the product have to face all these stages. All of them are explained below:
- Introduction: In this stage, marketers of the company needs to identify market and build awareness of the product. Cost is very high at this phase as it is required to reach potential customers. The developed product is being introduced by the organisation in the market at this level (Vasantha and Grönroos, 2013).
- Growth: This stage refers to the acceptance of customers and then companies tries to acquire more market share. As, Amtek Plastics UK Ltd is launching an innovative product so there is less competition in the market and it can reach to growth stage easily.
- Maturity: At this stage, competition increases and sales decreases, hence it is essential for the companies to enhance features in order to retain its market share. The best option at this stage is to reduce price to remain competitive.
- Decline: this stage is mainly related to the decreasing sales of the company and change of customer’s preferences. In this stage, companies choose to discontinue the product to ignore losses.
P4 Product line management choices that are required for product or service
Product line management: It is known as a group of associated products under a single brand that is being sold by the same company. Amtek Plastics UK Ltd can often expand their offerings through adding to existing product lines, because customers are more likely to buy innovative products from brands with which they can already familiar. There are three different types of choices that can be adopted by companies while developing new products:
- Down market product line stretching: This can be adopted by Amtek Plastics UK Ltd who want to acquire each type of customers whether they are from upper, middle or lower. In this type of product line, a company is already established in top or middle market and do not want to lose lower market. For this purpose, an organisation can launch a low budget product for that market.
- Up market product line stretching: This strategy is selected by those organisations who are running their business in lower market segment and willing to acquire high and middle. For this purpose, the company launches a high budget product for new market segment which is for premium customers (Voima and et. al., 2012).
- Two-way product line stretching: In such type of option, Amtek Plastics UK Ltd can launch different products with unlike prices so that they may acquire premium as well as lower market segment.
M2: Justification
According to Stark (2015), product life cycle management is very important for a business to run it in effective manner. While a company is willing to launch a new product than it is essential to gather information of market and competitors so that planning can be done in advance to ignore possible issues. This is very beneficial for organisations to determine possible outcome of their plans. In-spite of all these hurdle, it is essential for the Amtek Plastics UK Ltd company to make proper evaluation of the facts and strategies that are assist them to make valuable decision regarding the introduction of modified product.
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CONCLUSION
From the above project report, it has been analysed that a company needs to follow the new product development process while launching an innovative product. This will help to introduce the product successfully. Customer integration is also very important as it can help to record their reaction on the products or services that are modified and innovative. Overall assessment of life-cycle stage of products and services are taken into account that can assist them to make products more integrated for the customers. Evaluation of appropriate product line management that are needed for individual products or services are done to analyse the necessary results to the company in near future time.
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