Book Title
Marketing 5th Edition

978-0077729028 Chapter 12 Slides

April 8, 2019
Powerpoint Slides With Teaching Notes
Power Point Slide Teaching Notes
12-1: Developing New Products
12-2: Learning Objectives These questions are the learning objectives
guiding the chapter and will be explored in
more detail in the following slides.
12-3: 3D Printing As more companies and consumers seek out
3D printers, their prices have dropped
The technology keeps improving, and the
machines seem poised to take off.
Ask students How could they see themselves
using a 3D printer?
12-4: Innovation and Value A new product can be anything from a slight
redesign to new-to-the-world offerings.
Ask students: What is an example of a
slightly redesigned product? What about a
new-to-the-world product?
Ask students: Think of a new product that
interested you as a consumer. Did this new
product alter your opinion of the firm that
offered it?
12-5: Check Yourself Changing customer needs, market saturation,
managing risk through diversity, and fashion
12-6: Diffusion of Innovations Group activity: Have groups pick one
product. Ask them; what group of consumers
would purchase this product? Why?
Example answer: TiVo has been around for
about 10 years, it is probably in the early or
late majority stages.
Cable television, on the other hand, is now
appealing to laggards; whereas some new cell
phones are appealing to innovators and early
Ask students where they are on the curve? If
they are laggards what have they recently
purchased or not yet purchased?
12-7: Identify the Adopter
12-8: New Product Introductions Despite first-mover advantages, pioneers often
lose out to superior competitors.
For example, DVD walkmans have been taken
over by apple iPods.
First movers must staunchly defend their
After establishing the market, they generally
must switch to a defender mode to fend off
12-9: Recycled Organic Clothes This clip examines innovation and trends as it
looks at recycled organic clothes and the
consumers reaction to this innovative idea.
Note: Please make sure that the video file is
located in the same folder as the PowerPoint
12-10: Using the Diffusion of Innovation
Different products diffuse at different rates.
Various factors increase the speed of diffusion
of a new product.
Group activity: Continue with the previous
group activity.
Assess why some of the products chosen by
the groups diffused more quickly than others
by applying the four criteria in the boxes.
12-11: Check Yourself 1. Innovators, early adopters, early majority,
late majority, laggards.
2. Relative advantage, compatibility,
complexity and trialability
12-12: How Firms Develop New Products This slide is designed to introduce the new
product development process and the steps to
Group activity: Have each student group
think of a new product. It need not be a
“new-to-the-world” product.
Then have them follow the steps in the New
Product Development Process and describe
what they would do at each step.
This exercise might take an hour or so, so it
may be used as an out of class assignment.
Have students present their process to the rest
of the group.
12-13: Idea Generation Firms must constantly scan the environment
looking for new product ideas.
Depending on the company strategy, they use
different sources.
12-14: Internal R&D Larger firms often maintain their own R&D
department and rely on it to generate new
products that will lead the market.
This YouTube link (always check before class)
is for Pepsi Crystal a new product invented
by Pepsi which did not last long on the market.
12-15: R&D Consortia To defray large new product development
costs, firms/governments may join forces with
educational institutions.
Group activity: Investigate whether any
research groups work through your university.
How might their findings help firms develop
new products?
12-16: Licensing Firms license the use of new products,
technology and processes.
Small biotech firms frequently license their
inventions to larger pharmaceutical firms
12-17: Brainstorming Many firms, such as ConAgra, now give
employees time to develop new products and
new ideas, and then showcase them in
employee new product shows.
This web link brings you to IDEO.com. Like
Inventables from the first slide, they are a
design firm that helps clients generate new
product ideas.
12-18: Outsourcing In some cases, companies have trouble moving
through these steps alone, which prompts them
to turn to outside firms.
12-19: Competitors’ Products Products with patents or other proprietary
protections cannot be copied, so reverse
engineered products must be substantively
different from their source product.
12-20: Customer Input Fashion-based product lines often identify
trend leaders and watch them to gather new
Ask students: Have you ever modified a
product, e.g., apparel, a car? Why did you do
12-21: Concept Testing Concepts are presented to potential buyers or
users to gauge their reactions.
Marketing research techniques discussed in
chapter 9 are used to test these concepts.
12-22: Steve Wynn Video Clip This clip looks at Vegas legend Steve Wynn.
It examines the Casino business and Wynn’s
success as the Come Back Kid” as his new
resort is showcased.
Note: Please make sure that the video file is
located in the same folder as the PowerPoint
12-23: Product Development A prototype allows consumers to interact
physically with the product.
Some prototypes, such as the concept cars
revealed at auto shows, never actually go into
12-24: Market Testing Premarket test are conducted by research
firms, such as ACNielsen (BASES II).
Because test marketing reveals a new product
to competitors, it might be inappropriate to
expose some new products this way.
Ask students: Think of some products that
you think should not be subjected to test
marketing. Why not?
Answer: incremental improvements on
existing products (such as a new flavor of
soda), small niche products because they only
appeal to small market, products that could
easily be copied by competition, etc.
This YouTube link
v=pcj7QT0Abk8) is a funny commercial for
Dodge where they are getting input from
12-25: Market Testing Ask students: In the rush to get a product to
the market, some firms fail to conduct the
necessary market tests.
What happens then? Students will realize that
these new products often fail because the either
don’t offer value or cannot communicate value
to the end consumer.
12-26: Product Launch Launching a new product is part art and part
Each of these products offered unique benefits.
Ask students if they feel each would be
successful? Drink and Crunch is still only in
limited release so its success in not yet known.
Minute Maid Heart Wise was introduced in
2003 and has been extremely successful.
Aquafresh Floss N’Cap has been expanded to
other Aquafresh lines including whitening.
12-27: New Product Marketing Mix The right product must hit the market at the
right time and for the right price.
It matters little how good a product is if the
launch lacks sufficient resources.
The timing of the launch may be important,
depending on the product.
Group activity: Continue with the same
products the students have been working with.
Design the marketing mix required to launch
it. How will you communicate its benefits?
What types of distribution will you use? How
will you determine the price? When will you
12-28: Launching a New Product “Timing is everything” may be an old saying,
but it is only too true for new product success.
12-29: Evaluation of Results Marketers cannot only celebrate success but
also must understand failure.
The question of why a product fails is just as
important as why another succeeded. An
underperforming product may require further
12-30: Check Yourself 1. First, they generate ideas for the product or
service. Second, firms test their concepts
by either describing the idea of the new
product or service to potential customers or
showing them images of what the product
would look like. Third, the design process
entails determining what the product or
service will actually include and provide.
Fourth, firms test market their designs.
Fifth, if everything goes well in the test
market, the product is launched. Sixth,
firms must evaluate the new product or
service to determine its success.
2. Internal research and development (R&D)
efforts, collaborate with other firms and
institutions, license technology from
research-intensive firms, brainstorm,
research competitors’ products and
services, and/or conduct consumer
12-31: Product Life Cycle The PLC represents an important tool
managers use to plan their marketing activities.
12-32: Stages in the Product Life Cycle At each stage of the lifecycle, the marketing
mix elements change in response to the
Group activity: List products that currently
exist in each of the stages. What marketing
mix would you design for each of these
12-33: The introduction stage of the PLC Discuss the difficulties associated with the
introduction stage, especially if the product is
totally new to the world.
Ask students: What challenges do firms face
in this stage?
This ad is very good to discuss how the PLC
can be for a product category, a brand, or an
individual product in the line.
The Mucinex brand itself is in a very mature
category. The brand has only been around for
a few years and is still in the growth stage.
This particular product is in the introduction
stage of the PLC.
12-34: The growth stage of the PLC Discuss the concept of the tipping point”
the transition between introduction and growth
when the product either gains market
acceptance or must exit the market.
The majority of new products fail at this point.
Clorox wipes compete in a market that is
attracting many new offerings every year.
They must continue to fight for customer
acceptance and market share.
12-35: The maturity stage of the PLC Most U.S. products are in the maturity stage,
which means most U.S. firms must engage in
defending their market share.
In the battle for soft drinks, a very mature
market,, a 1% market share switch between
Coke and Pepsi can account for millions of
dollars in revenue
Ask students: What marketing activities
should firms engage in at this stage?
The market for mattresses is very mature.
However, brand like Sealy continue to
innovate to prolong the maturity phase.
12-36: A behavior in the decline stage? Ask students: If your company’s product were
in its decline stage, how would you determine
whether to update the product, continue
offering it for a small segment, or exit the
market completely?
Pirating is big many would like to see a
decline in this behavior and for related
products to be in the decline stage of the PLC.
In fact, there is huge growth in downloadable
products to help copy software, movies and
12-37: Strategies Based on the Product Life
Cycle: Some Caveats
Understanding where your product is on the
PLC is difficult. If a firm misdiagnoses the
stage, it can mean trouble for the firm.
Ask students: What happens to a product that
is misdiagnosed as being in the decline stage?
Answer: It will surely decline!