In International marketing, ‘global product planning’ is a term which is used to describe the complete process of bringing a new product or service to a new market. There two parallel paths involved in the global product planning process: one involves the idea generation, product design, and detailed engineering and the other involves market research and marketing analysis. Companies typically see new product development as the first stage in generating and commercializing new products within the overall strategic process of product life cycle management, used to maintain or grow the market share.
The following are the categories of new products in terms of their newness to the company and the global market respectively;
(a) New to the world
New products that create an entirely new market
(b) New product lines
New products that allow a company to enter an established market for the first time
(c) Addition to the existing product lines
New products that supplement a company’s established product lines i.e. package sizes, flavors, etc
(d) Improvements or revisions to existing products
New products that provide improved performance or greater perceived value and replace existing products
(e) Repositioning
Existing products that are targeted to the new markets
(f) Cost reductions
New products that provide similar performance at lower cost
Product Planning Process
The successful new product planning process consists of 8 major steps;
1. Idea Generation
• Internal sources
• Customers
• Competitors
• Distributors
• Suppliers
• Others
2. Idea Screening
To spot good ideas and drop poor ones
• is the product truly useful to consumers and society
• availability of market
• does it mesh well with company’s objectives and strategies
• is it easy to advertise and distribute
• availability of technology
• risk exposure, profitability, cost and benefit
• any other factor
3. Concept Development And Testing
• Product concept is a detailed version of the new product idea stated in meaningful consumer terms
• Concept development – a new product idea is developed into alternative product concepts
• Concept Testing – calls for testing new product concepts with groups of target customers
4. Marketing Strategy Development
• Describe target market
• Planned product positioning
• Planned sales and market share
• Profit goals for the first few years
5. Business Analysis
• A review of the sales, costs and profit projections for a new product to find out whether these factors satisfy they company’s objectives
• Sales forecast
• Estimation of costs and profits
6. Product Development
• Development of product according to the decided specifications.
7. Test Marketing
• In realistic market setting
8. Commercialization
• Launch of product in commercial markets.
Successful new products are the ones;
• They have relative advantage
• Have compatibility with other technology and distribution systems
• Allow trial ability / divisibility for buyers to try and learn
• Can be judged through observation
• Just right in terms of complexity of technology and use
• Offer value for the price.