Product and Service Development

Illustrate Each of the Processes Covered in New Product or Service Development

In the competitive marketplace, businesses can grow and develop smoothly by examining new product development processes. New Product Development (NPD) is explained as a process by which goods and services can place their position in the market so as to accomplish long-term success in the market. In the open marketplace, on a daily basis, numerous products enter the market (Gomez, Salazar, and Vargas, 2016). But out of which only a few of them are able to capture the market and are recognised by the customers. In order to make the goods and services successful in the market, it is essential to innovate or make changes in the goods according to the expectation level of the client. By doing so, productivity and profitability ratios in the context of the products and services are raised tremendously. New product development has eight steps, which are elaborated as under:

1. Idea generation: There is no fixed place and time to generate ideas. In the competitive marketplace, it has been seen that millions of goods and services are entering the market, but very few are able to survive in the market (Du, Yalcinkaya, and Bstieler, 2016). Those products that are innovative go well in the market. In this particular step, from the pool of ideas, the most suitable idea is selected, and the further proceeding is done. L'Oréal is coming up with an anti-ageing unisex lotion. The various sources of idea generation are illustrated as under:

2. Internal sources: It involves research and development teams and internal staff members, who are some of the internal sources from where new ideas can be generated. Many organisations invite their employees to share their creative ideas so that innovation can be done in the existing goods and services. Additionally, certain benefits and incentives are given to those workers who voluntarily come up with innovative ideas.

3. SWOT analysis: By deeply analysing its own strengths, weaknesses, opportunities, and threats, a company is able to come up with new and fresh ideas in the market (Cui and Wu, 2017).

4. Customers: The idea is generated by studying the feedback and complaints suggested by their targeted customers. It helps form to come up with creativity in their products and services.

5. Competition: In the open marketplace, other firms are benefitted through SWOT analysis of competitors. From the opportunities and threats of rivalry, new ideas can be generated easily.

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6. Idea screening: In the new product development process, this is the very next step after idea generation. Here, filtering of ideas is done out of several ideas, and an anti-ageing unisex lotion is selected. This is done in order to choose the most suitable and feasible idea. Idea screening refers to selecting the most appropriate and fresh idea and dropping the rest of the other ideas. Management of the organisation dies idea screening in order to come up with an idea where the least cost is involved. By doing so, chances of failure are reduced to some extent because proper scanning of the idea is done.

7. Concept development and testing: Busies is unable to gain competitive advantages in the market until and unless the organisation figures out the desired needs and preferences of the potential customers. It is possible through research and development of the goods before launching in the market. For testing of anti-ageing unisex lotion, a free sample is given to the customers. By this, customers can be assured of the quality of the lotion. On the other hand, information regarding lotion is given through visual presentation so that the benefits of anti-ageing lotion are spread among the targeted customers (Cozzarin, 2017).

8. Market strategic analysis: When the innovative anti-ageing lotion of L'Oreal is tested among the customers, the next step is to formulate a marketing strategy. By scanning the market scenario, organisations come up with effective marketing tactics to commercialise their lotion in the global market. Three steps are covered in the marketing process that is discussed as follows:

9. Market decisions: Here, the suitable market is identified for the launching of the anti-ageing lotion. After this step, the pricing of the lotion is set, and various promotional activities are determined in market decisions.

10. Budget decision: Here, estimated capital required to promote the anti-ageing unisex lotion of L'Oreal is done. Before launching the lotion in the market, business associates calculate the amount of finance required for its advertisements, promotions, campaigns, and many more (Cooper, 2019).

11. Marketing mix decisions: The sum of the 7 Ps (product, price, place, promotion, physical evidence, people, and process) is the marketing mix. It is very essential to deeply examine all the 7 Ps of marketing in order to make the anti-ageing unisex lotion successful in the international market.

12. Business analysis: The very next step in the new product development process after marketing strategy is business analysis. Here, cost, sales, and profit margin are examined by the organisation in the context of anti-ageing unisex lotion. It is a managerial procedure that includes an analysis of the market attractiveness of the lotion so as to launch the anti-ageing lotion in the global market. On the other hand, the budget cost sheet is formulated by the top-level management in order to ascertain the profit ratio. By doing so, the best decision can be taken regarding the launching of the anti-ageing lotion in the open marketplace. However, failure of risk can be measured in order to get an idea regarding the level of business success in the cutthroat competitive world (Charter. and Tischner, 2017).

13. Product development: This is another step involved in the new product development process where the anti-ageing lotion of L'Oreal is physically existent. Product development plays a critical role in making the lotion successful in the market. On the basis of quality, price, value, etc., lotion is tested, and accordingly, the decision to purchase it from the market is made. In this stage, all the plans and tactics are actually executed. This weak area can be identified, and necessary improvements can be made accordingly by the process of business analysis in order to gain productive results.

14. Test marketing: It plays a significant role in the market in regards to anti-ageing unisex lotion. In this specific stage, the lotion of L'Oreal is actually taken out for consumption by customers. Along with this lotion, it is tested by its targeted customers so as to render the experience of the lotion to the potential client (Habe and Fargnoli, 2017). By doing so, the position of the product can be identified in the market by their reaction towards the lotion. It incurs huge capital; despite this, it is done in order to make the lotion successful in the global market.

15. Commercialisation: Here, the anti-ageing lotion is launched in the target market so that potential customers can be attracted towards the lotion and sales volume can be raised accordingly. A large amount of finance is required to commercialise the lotion in the market. However, it can be said that L'Oreal's anti-ageing unisex lotion is ready for consumption (Bogers and Lhuillery, 20

An explanation of how each stage of the new product development process can be applied for the development or improvement of products or services.

New product development for the anti-ageing unisex lotion 

Idea generation: For determining the idea of a new product or development in the existing one, research was conducted by L'Oreal within the organisation. In this, they took suggestions from their employees through a questionnaire in which various open-ended questions were included. On the basis of the outcomes of the research, it was analysed that the company can launch an anti-ageing lotion that can be used by both males and females. This will make them unique, as their competitors provide anti-ageing cream, but with this, the customers can take care of their skin and other body parts.

Idea screening: For efficient screening of the idea, L'Oreal conducted a feasibility analysis with the help of which they can determine the demand for their product in the market, the loyalty of the customers for their products and services, etc. In addition to this, the economic and financial feasibility will also be analysed. With this, it is analysed that this option will be feasible for the company, as with this their profitability can be enhanced (Ayllón and Radicic, 2019).

Concept development and testing: In this stage the research and development department of L'Oreal analysed the external market for the tastes and preferences of the customers while the managers in the organisation determined the internal capabilities. Also in this stage, the products are provided to the customers for the purpose of testing, and feedback is taken from them so that necessary changes can be made. However positive responses were received, which implies that the idea is viable.

Market strategic analysis: After analysing the tastes and preferences of the customers, it is important for the organisation to formulate various strategies with the help of which they can effectively launch the products in the market. Various strategies that need to be formulated include pricing strategy, promotional strategy, and the process with the help of which the products will be made available to the customers. This can be done with the help of the marketing mix strategy of the marketing as it will enable them to take into consideration all the factors. For promoting the new product of L'Oreal, i.e., the anti-ageing unisex lotion, various methods, such as traditional and digital marketing methods, can be adopted. Traditional methods such as advertisement through newspapers and television can be done. Along with this, postcards and magazines can be used to promote the new products. In addition to this, digital marketing methods must be used as people are more connected with various online platforms. They must focus on various social media platforms, direct marketing, and online advertisements to target their customers.

Business analysis: In this step of the new product development process, the availability of the funds is identified on the basis of the budget so formulated. Also, various estimations are done in the context of profits and costs that they may have to bear. The risk associated with the launch of a new product and the improvement in an existing business is to be analysed so that the possibility of the impact on the business can be understood. Similarly, this new product of L'Oreal is done by their managers (Veiga and Weyl, 2016).

Product development: In this stage, sample products are developed on the basis of various identified features of the product. Such products are then tested by the quality team of the company so that the quality of the offerings can be ensured. With the help of the production department of L'Oreal, they can continue their production or introduce changes as per the requirement of the quality team. This newly launched product, an anti-ageing unisex lotion, belongs to the product range of skin care products of L'Oreal Paris. It will help them in expanding their skin care product range.

Test marketing: After the products are developed, they are sent for testing in the market where the products are promoted by the marketing team of the company. With the help of this, they can determine the efficiency of various strategies formulated by them. The responses of the actual customers are taken by making their new product available in the departmental stores and by distributing sachets of the lotion among the customers. This will enable the customers to provide their reactions; with the help of this, the marketing team can analyse their reactions towards the product.

Commercialisation: This is the last stage of new product development in which the focus is laid on the commercialisation of the products so developed by the company. Their unisex lotion will be available to the customers in all the stores, such as in all general merchandise stores, supermarkets, etc., where their existing products are made available to the company. Also, for taking the competitive advantage, they can sell this product in the market with the help of various online platforms, such as through various e-commerce websites and even from their own official website (Ward, Oosterwal, and Sobek II, 2018).

Reflection of the report

At the time of undertaking, I analysed that in this project of developing the new product, various steps need to be followed by the company. For this, the responsibility of identifying the ideas of innovation in the product and service or new product can be determined by our teams. On the basis of this, it was analysed that they need to undertake various research projects that can be conducted by the company at the organisational level or on the market level. The tasks were divided by our team leaders among all the team members as per our capabilities and level of understanding. I was given the task of analysing the various stages of the product life cycle, and in this I had to go through various stages through which the product has to pass. For this, I evaluated each and every stage of the product life cycle for the variety of products that are offered by L'Oreal. This enabled me to identify the areas where they are lagging behind. Also, I had to go through with the analysis of various stages of PLC for the innovative product that is offered by the BODY SHOP, which is an herbal sunscreen cream for both males and females. Various stages of the PLC include introduction, growth, maturity, and decline. This enabled me to suggest various strategies to the management on the basis of the analysis done by me. I identified that in the introduction stage, the product struggles to gain recognition among the customers. Then in the stage of growth, they need to adopt various strategies that can give them a competitive advantage, while at the maturity stage, they need to maintain the level of their product with significant improvements in it so that the interest of the customers can be made in the offerings. I analysed various products that are offered by The BODY SHOP and L'Oreal, with the help of which I analysed that they are planning to offer a similar type of product that can offer the customer a solution for dealing with a specific issue. The analysis made by me needs to be presented before the team leaders so that they can analyse the effectiveness, and further, they need to be presented before the management of the company so that they can formulate various strategies that they can undertake for managing their products.

Each and every member of the team was allocated various tasks on the basis of various skills and competencies that were possessed by them. I was given the responsibility of analysing the PLC and various strategies, as I have sufficient knowledge of it. Our team leader has provided instructions and guidance about who has to do what and how. Due to this, I was given the responsibility of writing the content for the presentation. For this, I had to consult each and every member so that their data and information could be taken on time and the final content could be prepared on time.

All the tasks that had to be performed were allotted a time limit within which they had to be completed. Due to my planning various activities along a time limit, I could complete my part on time, such as gathering the information, their analysis, and many more. We had effective communication among all the team members, due to which all the activities went on smoothly. However, the decision-making powers were with the team leaders; this was with the aim of avoiding the chances of conflict among the team members.

A group discussion was conducted for the team members in which all the members were given the opportunity to express their opinions, suggestions, problems, etc, so that the organisation could significantly innovate in their existing products or by way of new products. On the basis of my analysis, I suggested L'Oreal launch a lotion that can fight ageing because anti-ageing creams are available, but lotion is not, while The BODY SHOP must offer an herbal sunscreen cream to their customers as these days the customers prefer so. With the help of this discussion, creativity was brought into the team.

All activities went smoothly, but in the initial stages, while tasks were allocated, some of the team members resisted the allocation as they felt that they had not been allocated various roles and responsibilities as per their capabilities. But such resistance was easily managed by the team leader as he could justify his actions. For further improving the results, various recommendations are made, which include:

1. All the team members must have the same level of competence and specific capabilities on the basis of which work can be allocated to them. This can reduce the chances of conflicts among the employees (Abualloush, Bataineh, and Aladwan, 2017).
2. Various skills need to be developed among the teammates that can lead to collaborative working practices among them. With this better understanding, it can be developed.
3. Various barriers must be identified that can lead to some issues, such as diversity among the team members, communication gaps, etc., as it will enable the team leaders to manage them efficiently.

Also Read: Advantages and Disadvantages of the Fast Food Industry.

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