Chapter 12
Developing New Products
Tools For Instructors
Brief Chapter Outline
Learning Objectives
Extended Chapter Outline with Teaching Tips
PowerPoint Slides with Teaching Notes
Additional Teaching Tips
Brief Chapter Outline
Why Do Firms Create New Products?
Diffusion of Innovation
Learning Objectives
LO 12-1 Identify the reasons firms create new products.
Firms need to innovate to respond to changing customer needs, prevent declines in sales from
suppliers.
LO 12-2 Describe the different groups of adopters articulated by the diffusion of innovation
theory.
The diffusion of innovation theory can help firms predict which types of customers will buy their
products or services immediately upon introduction, as well as later as they gain more
take risk and therefore tend to wait until “the bugs” have been worked out of a particular product
LO 12-3 Describe the various stages involved in developing a new product or service.
When firms develop new products, they go through several steps. First, they generate ideas for
the product or service using several alternative techniques, such as internal research and
new product or service to determine its success.
LO 12-4 Explain the product life cycle.
The product life cycle helps firms make marketing mix decisions on the basis of the product’s
stage in its life cycle. In the introduction stage, companies attempt to gain a strong foothold in
cycle helps managers determine its specific strategy at any given point in time.
Extended Chapter Outline With Teaching Tips
I Why Do Firms Create New Products? (PPT slide 12-4)
A Changing Customer Needs
Check Yourself: Several questions are offered for students to check their understanding of core
concepts. (PPT slide 12-5)
1. What are the reasons firms innovate?
II Diffusion of Innovation (PPT slide 12-6)
A Innovators
B Early Adopters
4 Complexity and Trialability
Check Yourself: Several questions are offered for students to check their understanding of core
concepts. (PPT slide 12-11)
1. What are the five groups on the diffusion of innovation curve?
2. What factors enhance the diffusion of a good or service?
III How Firms Develop New Products (PPT slide 12-12)
A Idea Generation (PPT slide 12-13)
1 Internal Research and Development (PPT slide 12-14)
7 Customer input (PPT slide 12-20)
B Concept Testing (PPT slide 12-21)
4 Timing (PPT slide 12-27)
F Evaluation of Results (PPT slide 12-29)
Check Yourself: Several questions are offered for students to check their understanding of core
concepts. (PPT slide 12-30)
1. What are the steps in the new product development process?
Answer: The steps in the new product development process are idea generation, concept
2. Identify different sources of new product ideas.
Answer: To generate ideas for new products, a firm can use its own internal research and
services, and/or conduct consumer research.
IV The Product Life Cycle (PPT slide 12-31, 32)
A Introduction Stage (PPT slide 12-33)
F Strategies Based on Product Life Cycle: Some Caveats (PPT slide 12-37)