Introduction
Fish care is a relatively new industry. For a long period, fish has been viewed as food. It is a rich source of protein. However, due to innovative minds, people came to realize that fish could also be a pet. This saw the development of aquariums made of either transparent plastic or glass where fish could be kept for viewing.
The gliding of fish inside these aquariums gives a spectacular sight. This has seen an increase in the usage of these aquariums as beautifiers in social places or homes. According to Woodruff (1997, p. 37), aquariums have become very popular in such places as hotels, parks, churches and such other places.
This industry, though still relatively young, is growing very fast. Emerging technologies have brought in sudden changes in the fish care industry. The structure and designs of the aquariums are changing and the processing of water to be used in the aquariums has changed. As Piercy (2009, p. 134) notes, emerging technologies have seen new and better structures of aquariums developed.
A company in this industry must realize that the market is so competitive, with new products, which have better services being offered at regular intervals. This competitiveness of the market would demand that this company be in a position to offer the market such new and enhanced products, which match or exceed those of the market competitors. It is upon this that the firm would be in a position to manage competition. In order to achieve this, the firm must embrace research and development in order to bring into the market new products.
New Merchandise
A product would be considered new if it was not in existence before, or if it assumes a new shape from what it had before. New product development is the core role of research and development department in any organization. This department is charged with the responsibility of ensuring that the company keeps providing the market with products that are able to meet the standards of the market. As such, this department must be creative and innovative.
It must be in a position to provide the market with new and better products at intervals that would ensure it remains relevant. However, the process that leads to new product development is always complex and characterized with many challenges. The process involves conducting a research into the market in order to realize its expectation. With the current demanding market, social marketing is the only approach that can save a company from possible fallout.
The company must realize that it all starts and ends with the customer. The company must know what the customer needs, be creative enough to produce what meets or exceeds this need and take it back to the customer in a manner that would enhance satisfaction.
Financial Implication in New Product Development
New product development is a research process. New products always come from the market into the minds of innovative individuals. It would start by understanding the market in its status as far as customer satisfaction is concerned. Then the next step would be providing products that would be in a position to achieve these needs.
New product development has a procedure that comes with some serious financial complications. The process starts with idea generation. In order to generate an idea about a new product, a market research would be required and this comes with some financial implications. It would require some amount of money to be in a position to design and distribute questionnaires, collect, and analyze them if the research involves the use of a questionnaire. If it were market observation and oral interviews, it would require some voice recording gadgets that would enhance this research.
Monetary Suggestion
When this research has been made a success, the next step would be to be to implement the research findings that would result in new product formulation. The idea generated from the research would undergo screening. The research and development team would go to the firm’s laboratory and produce the items that the market research proposed. This would require a considerable amount of money, taking into consideration the materials that would be required in the construction of an aquarium. It is also worth noting that the process would also incur breakage as it is on a trial version.
The last stage in new product development would be to introduce the new samples of the product to the market. The essence of coming up with the new product is to meet or even exceed customer expectation. This would make customers be attached to the firm. This stage precedes the commercialization stage.
Test marketing enables the firm to ascertain how prepared the market is for the new product before the company embarks on mass production. This would demand that the company to use substantial amount of money as this process would not yield much revenue to meet cost of their production.
The last stage would be the commercialization. In the commercialization stage, the production would be done in mass. There should be enough money for this process to be successful. Because this industry is still relatively young, this company would have to identify markets that would be able to absorb the new products. This process must be appropriately financed.
Selection of New Product
As stated above, the market is very competitive with firms bringing in new products at very close intervals. Technology is changing very fast and it defines new ways of conducting business in the market. Moreover, this changing technology is redefining lifestyle of the society hence the needs of these people change. As such, it would require any firm that wishes to remain competitive to devise new means of managing the market demand. Market research is therefore very important in order to come up with new ideas. It should be observed that developing of new product is the only way to remain competitive. Idea generation can only take place if proper research is conducted. Idea screening would help in determining the viability of the new idea. As
Payne and Holt (2001) say, many of the new ideas that always come to the mind of researchers are always fantasies. They look very attractive but on practice, they cannot be implemented to yield results that it proposed. The screening process is meant to eliminate fantasies from practical ideas.
Although Lindgreen and Finn (2005) hold that it is from fantasies that the best products that ever existed or currently exist were formulated, fantasies may not be very attractive, especially when the cost implications are huge and the firm is not in a position to take care of it. It would therefore require that only viable ideas that can be implemented with the financial base of the firm at its status be considered for implementation. Test marketing would help the firm determine how acceptable the product is in the market while the commercialization is the ultimate goal of the firm that would result in revenue generation.
The entire process of new product development is the only way that can ensure that a firm manages market competition. As Kotler, Keller, Brady, Goodman, and Hansen, (2009, p. 75) say, a firm must make an effort to ensure that it is competitive enough by providing the market with products that meet their demand. As such, it would be expected of it to develop new products to match new demands that come due to societal changes brought about by changing technology. Although this industry is relatively young, new firms are coming in with aquariums that are well advanced and easy to manage. Therefore, this company has all the reasons to ensure that it produces new products at intervals that would enable it remain competitive in the market
Development Phase
The market is characterized with a lot of competition. It is because of this competition that firms find it necessary to develop new products. New product development entails various processes that should be taken within a specified time. As Holbrook (2003, p. 46) says, within the market are players who would be keen on imitating other firm’s new products. Many firms rarely develop original ideas.
They adopt new ones that others have come up with in the market. It can be very dangerous for such firms to learn of an idea that another firm is planning to develop because they can hijack such ideas and move to produce the product and claim ownership to it. As such, the firm that had spends a lot of money in research and idea generation would go without any benefit. This can be very frustrating because it may not be easy to go through a similar process and produce another idea that would satisfy the market demand.
This would therefore demand that this firm develops the idea at a considerable faster rate in order to deter competitors from stealing the idea. To achieve this, this firm must embrace emerging technologies. Emerging technologies would enable this firm manage the speed that is needed for the production process.
Product Formulation
New product development always has stages that it undergoes before it can be availed in the market as a new product. As Lindgreen and Finn (2005, p. 78) notes, a new product would first be developed in the mind, before it can be made real. Creation of a product in the mind would only be possible if there is a market research conducted. The idea would only be made into a product if all the stages necessary were successfully taken.
The first stage in this process is idea generation. Idea generation involves coming with a product, in mind, that is able to meet customer expectations. In order to do this, there must be a proper market research conducted. It is important to note that for one to be creative enough to come up with a new idea, he or she should have a comprehensive understanding of the market. The understanding should be based on what is already available in the market. A researcher would look at how well the current products are able to meet customer needs. Having understood this, the marketer would then need to develop ways (ideas) of making customer experience better than the current one. Care should be taken to ensure that the new product exceeds the current products in satisfaction for it to be considered relevant.
The next stage would be idea screening. Not all the ideas that come from market research are viable for implementation. Lindgreen and Finn (2005, p. 73) say that before implementation of any new idea, screening of the idea is necessary to ensure that the idea is viable. The viability of an idea would be analyzed from many fronts. The first front would be the financial implication. It is important to determine if the idea can be implemented given the firm’s financial status, and if the idea would be able to remit expected returns. The idea should also be screened for other factors as ethics and regulatory procedures and other legal concerns.
The next stage is concept development and testing. A number of activities are always carried out at this stage. At this stage, the research and development team would determine the originality of the idea. It is important to ensure that no other individual other than the firm’s research team claims property to the idea. This would help the firm avoid lawsuit after the product has reached advanced stages. The target market should also be analyzed to ensure that the product to be availed to them would be acceptable. This may call for a mini research conducted among a small sample population. This would help determine the viability of the idea.
Upon completion of the above stage, the next stage would be marketing strategy. The new product would be expected to occupy a special position within the market. Marketing strategy involves going back to the market where the research that resulted in idea generation was conducted. The research and development team would conduct a research to determine how acceptable the product can be in the market. The team would also develop ways in which this product can be introduced in the market in order to have the impact that would ensure sales at expected rates.
Innovative Product
After this, the next stage would be business analysis. Business analysis would help determine the current situation of the firm. Holbrook (2003, p. 97) says that conducting situational analysis of the firm helps know how prepared the firm is, in the implementation of the idea. This would help eliminate cases where an idea implementation begins, but is soon stopped because the business is not in a position to implement it.
The next stage would be the development of the new product. It is at this stage that the idea is transformed into a tangible product. The research and development team would need to develop samples of the product. At this stage, production of the new product is done as a sample to be tested if it meets what it claimed to meet. It is important to note that this process would give this team the sample that would be a representative of the new product.
When the samples are produced and the research and development team confirms that the product meets the desired expectations, it would then be taken to the market for testing.
At this stage, the team would take samples of the product to the market for analysis. Test marketing would involve determining acceptability of the product in the market. This stage is also used as a way of awareness creation in the market. The target market is made aware that the product is available and that it comes with new benefits that are worth trying. The rationale of this stage is not only to test the acceptability of the new product, but also to make the market aware of the superior value that this new product brings to the customers.
Should the above stages be successful, the final stage would be commercialization. Commercialization process would involve bringing the actual product to the market in mass. As Holbrook (2003, p. 124) notes, commercialization would follow the path created by the test marketing stage. In commercialization, the research and development team, in conjunction with the marketing and production departments, would ensure that desirable amount of the new products are made available within the selected markets.
The Stage Gate course of action
Stage gate process would help define players in the process of new product development is a simpler tabular form.
Stage gate process
Forms of Research and Development
Research is the only sure way that a firm can use to manage market competition. There are three major categories of market research that a research may be involved. The market forces would dictate this. A research can be on new product development, improvement of an existing product or new technology adoption. These three types of research and development would be necessary at different times and they require differing attention.
New-fangled knowledge
Technology holds key to success in the business world. Competition is so stiff and currently there is no such thing as permanent competitive advantage. What a firm may consider as its competitive edge today may turn out to be its main source of failure tomorrow. As such, there is need to embrace emerging technologies in order to manage competition. In this regard, it is important to note that the means of production is to be changed.
The firm maintains old products but employs new means of producing them. Fish care industry is not very advanced, as it is relatively new. However, technology involved in the production of the aquarium is very complex. It would therefore be necessary to ensure that this firm adapts the technologies that are able to help it meet market expectation. The firm should ensure that it adapts the technology at a considerable faster pace.
The firm should avoid rushing into new technologies because not all new technologies are applicable. It should also avoid being skeptic or late adapters of emerging technologies because it might be too late to adapt such new technologies. The firm should consider being technology enthusiast
Gant Chart (Months)
Innovative Product
In new product research process, the focus would be on new product production using existing technologies. The means of production would remain the same. In this industry, it would involve production of new aquariums that meet market demand. Although very little has changed in as far as the design of the aquarium is concerned, there are a number of adjustment that have been done on the original design.
As this industry grows to different regions, it would be important to ensure that issues such as temperature and potential difference are considered. The temperature in United Kingdom is different from that in North Africa and in Middle East. These regions would therefore need different temperature regulators.
A research on new product would therefore consider such issues as new temperature regulators that would fit in the above named different conditions. New product should be able to provide new experience to the customers. It should come with new features that would make it stand out as a new product.
Innovative Product Gant Chart (Days)
A research process can also be conducted in order to improve the existing products. In this case, existing products would be produced using existing technologies but with different features. The rationale behind this is to ensure that existing products are modified to produce extra value to the customer.
Unlike new product that comes with a whole new experience, improving existing products would give the same old experience but in a better way or with some added value. Customer would be able to realize that the product at hand is the one that has been in use for some time, but now it offers better experience.
As Holbrook (2003, p. 73) says, new experience may come in a number of ways. One way in which a product can be improved to give a better experience is by designing new packages that makes the product look more attractive.
Budgetary Allocation
The above research processes would need financing in order to achieve the desired result. As Lindgreen and Finn (2005, p.123) says, budgeting does not have fixed rules on how it should be allocated on various projects. Research and development team would allocate the available finance as per the needs of the organization.
Those that are more urgent should always be taken care of first before those that are less urgent. In budget allocation, those projects that have pressing concerns should be given as much allocation of the budget if they are viable and able to give returns. In the above case, research and development of new technology would be given 38 percent of the entire budget.
This is because the new tools and equipments may have heavy financial implications. Research on new product development would have 40 percent of the budget, while improving existing products would account for 32 percent of the total budget. Budgeting is an important part of any research project. The researcher should allocate enough resources to any section or activity. Implementation is the section that would cost more as regards to resource allocation.
Differences
The three kinds of research are different. When a research is based on new technology, the intent of the research is to introduce new methods of production of the current products. The product would not change, only that technology of producing them would be improved. When the research is based on new product, it would mean that a product different from the one in current existence would be introduced, but using existing technologies. If the research is based on improving existing technologies, it would mean that existing products would be upgraded using existing technologies.
List of References
Holbrook, MB 2003, “Customer value and auto ethnography: subjective personal introspection and the meanings of a photograph collection”, Journal of Business Research, Vol. 58, no. 1, pp 45 – 61.
Kotler, P, Keller, KL, Brady, M, Goodman, M & Hansen, T 2009, Marketing Management, Prentice Hall, Harlow.
Lindgreen, A & Finn, W 2005, “Value in business markets: What do we know? Where are we going?” Industrial Marketing Management, Vol. 34, no. 2, pp 732- 748.
Payne, A & Holt, S 2001, “Diagnosing Customer Value: Integrating the Value Process and Relationship Marketing”, British Journal of Management, Vol. 12, no. 2, pp 159 – 182.
Piercy, NF 2009, Market-Led Strategic Change, Butterworth Heinemann, Oxford.
Woodruff, RB 1997, “Customer Value: The Next Source for Competitive Advantage”, Journal of the Academy of Marketing Sciences, Vol. 25, no. 2, pp 139-154.