Growing an Organization Through Marketing by Reid Geary

Author:Reid, Geary [Reid, Geary]
Language: eng
Format: epub
Published: 2020-04-25T16:00:00+00:00

(Extract from Crawford and Di Benedetto 2012)

5.12 New product phases

When existing products have diminishing returns, an organization should try to introduce a new product, and the following steps should be followed. An organization cannot decide to have a new product for the market overnight; the product does not evolve by itself but must go through several phases.

Figure 31. New product phases

(Extract from Crawford and Di Benedetto 2012)

Some organizations will establish a specific unit within the organization that will be solely tasked with the responsibility to seek opportunities for creating new products. Once the unit decides on a new product, they have probably gone through all the phases above, or have chosen to skip some of them. The unit must decide on the phases that are essential to be followed and which ones can be skipped. It is ideal, however, that the quality of the new offering is not compromised, but rather that the organization gives the public something essential.

Most organizations will be happy if the products they have placed on the market can stay there for a long period. This depends on several factors. Some organizations have little competition, so their products may remain for a while. Thinking about cellular phones and vehicles, manufacturers must produce a new product almost every year. In these situations, organizations in these industries may have a specific unit solely responsible for new products. In cases with minimal or no competition, organizations in these industries may not need a specific unit dedicated to new products.

5.13 Considerations before deciding on a new product

While many organizations would like to introduce new products, others will be happy if they can keep the existing products on the market longer. One factor is that developing a new product might be very expensive. It also may be that the organization cannot gather enough information about its competitors or future customer trends, or that the risk involved in preparing and delivering a new product is high.

The future is always uncertain, and the effort and investment an organization will undertake do not guarantee that it will be able to recover its cost or that customer may like the new product. Organizations have many challenges in deciding when to launch a new product. Some will try to get to the market first, but even so, there may be another organization that is doing the same thing even faster. There is often competition to be the first mover, which can make a sizable profit if their prediction works out. On the other hand, some first movers pay a tough price when customers reject the new product.

Persistence is very important in growing the organization. Many organizations have failed in their attempts to affect the market, but many others that were willing to fight hard and plan their strategy well have been able to win. All organizations can be successful if they do the research and deliver the product that customers need. There are many ways of gathering information about customers’ needs, and the organization must make every effort to gather relevant data that will lead to sound decision-making.

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