A product is considered new if it completely opens a new market, replaces an existing product, or significantly expands the market for such existing product. Old products can be considered new when they are introduced to a new market, newly packaged or marketed with a different approach.
Some sources of new products include academic institutions, acquisition, competition, customers, outside investors, and internal product development. Developing and launching new products can be very costly and risky. In fact, it is generally said to be more risky than market penetration or development. One way to ensure that money spent on new product development is not wasted or to reduce failures in new product launches is to adopt the new product development process.
This process constitutes idea generation, selection of new ideas, concept development and testing, business analysis, marketing strategy, and many others. Planning and measuring the success of the new product can be done based on its performance at various stages of the product life cycle, that is, if the company uses this method of monitoring the progress of products. The important stages to consider when it comes to launching a new product are introduction, growth, and maturity. The company, however, can also choose other indicators.
For example, metrics such as new product sales revenue, cash flow, and profit margin will indicate how a new product is performing financially. However, new products are often subject to losses at the introduction stage due to inadequate demand, research and development costs, high fixed costs, and others. This must be taken into account when setting goals and measuring results.
Additionally, market share growth serves as an indicator of positive success, although this may not apply to all products or markets. For example, there are some niche products or a specific product that is new and needs to open its own market.
The internal perspective indicators are indicators that show how the processes within the company affect the success of the new product in terms of development and launch. These indicators are compliance with the budget and schedule, the evaluation of the development of new products, the marketing mix and the occurrence of shortages or excesses of new products and resources. Going over budget or schedule or regular shortages show that something might be wrong with the company’s operations, which can lead to failure in developing and launching new products.
In addition, frequent evaluation of the new product development process and the quality of the marketing mix can help drive the company’s experience as well as identify changes or modifications that can be put in place to improve product performance and performance. company overview.
The following set of indicators shows how the launch of new products can affect the company’s situation. Additionally, customer perspective indicators include repurchase rate, number of complaints, and customer awareness of new products. The development and production of new products generally require new skills, which could be through training. Employee involvement in new product development is also equally important. In addition, the evaluation and analysis of each launch is essential to achieve the company’s experience in launching new products.
