New product development is a strategy for a firm growth by offering modified or new product to a market segment. The process of new product development has various steps:
1. Idea generation looking for all possible ideas that may help to develop a new
2. Idea screening is the step of eliminating unsound ideas prior to devoting resources to them
3. Concept development and testing , the step of developing the marketing and engineering details
4. Business analysis is the step estimating likely selling price, sales volume, break-even point and profitability
5. Product development
6. Market testing is the step of producing a physical prototype , making adjustment where necessary and determining customer acceptance
7. Commercialization is the step of launching the product for market Once the new product is launched for the market, the remaining main task is the adoption of this new product, which is an innovation, by customers. This will take us to the next topic.
New product adoption process
In adopting process of the new product, customers differ according to the timing of their adoption of the innovation. One of the common models used is the diffusion model. The model groups the adopters of the new product as innovators, early adopters, early majority, late majority and laggards.
Innovators are understood as well-informed and risk-takers who are willing to try the new product. They represent the smallest percentage of the market. Early adopters are those, based on the positive response of innovators, who begin to purchase
the product. Early adopters tend to be educated and opinion leaders. They are more in numbers than the innovators.
Early majority are careful consumers who tend to avoid risk; they adopt the product once it has been proven by the early adopters. They rely on recommendations from others who have experience with the product. Late majority are skeptical and acquire a product only after it has become commonplace. Laggards avoid change and may not adopt a new product until traditional alternatives no longer are available.
The new product adoption process
The new product adoption process suggests the need for the firms to pay attention to help customers so as to go through the stages smoothly and adopt the new product. The potential buyer of the new product, from first hearing the product to the final adoption it
goes through the following five stages of the adoption process:
1. Awareness : getting information about the new product
2. Interest : seeking more information about the product
3. Evaluation : checking its benefits and cost
4. Trial : based on the evaluation to buy to estimate the value of using
5. Adoption : if the trial is favorable to adopt the new product to use regularly
