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Name : Farah Shazana Muhammad Hisham

Class : M08A

a) Describe the 5 stages of NPD.

The first stage in the new product development is idea generation. This stage
is where idea to put adding value to a product is being generated. The next
stage is idea screening. The ideas generated are screened for implications
whether the ideas are relevant for the product development or not. For
instance, the ideas are screened to cover issues such as resources and
finance to develop this new product. This stage is followed by the product
development and testing stage. This involves the production of prototype and
test marketing for potential customers. This is where feedbacks from these
potential customers are crucial for the firm to allow it to assess the possible
reactions to the new product and to further the firm’s marketing mix in order
to sell the developed product successfully. The prototype would be altered
until final product is produced. After that, the product has to undergo the
business analysis stage where management will view into the legal, financial
and resource viability to launch the new product. The final stage is the
commercialization ( on what scale?)- use the diifusion process as a
justification! of the develop product or the launching of the product. The
product will be distributed to retail outlets and various promotional
campaigns will be done to commercialize the new developed product. During
this stage, the firm is most likely to create awareness among potential
customers about the existing of the newly developed product.

5 marks

b) Discuss the problem of financing R&D in an era of rapid technology changes.

The major drawback of funding the R&D in the fact paced technological era is
it the product will become outdated fast. This is because when newly
developed product has just been launched, it will take only a short time for
other firm in the market to come up with a better and developed product due
to the advancement of technology. Besides that, manufacturing process
becomes simpler and faster. Thus, it is highly probable for a firm to produce
in the quantities required faster and more cost efficient, something that is
unattainable back then, ….so how this un-avail the finance?? Internal finance
& lenders???. Another problem of financing R&D is the financial or cost
constrain. This is because, the development of products during this era is
more expensive compared to that during the yesteryears. As technological
boundaries have been pushed forward, the cost of even modest new product
development has risen sharply due to the more advanced utilities and
research. In fact, new discovery is made each day through research and the
cost of carrying out research that is only useful for a temporary period is just
not worthy. Another constrain is, rapid technology change also means rapid
change of customers’ tastes because people nowadays are easily bored with
products. People are not as loyal to a product as they used to. It means that
the products have increasingly shorter life spans. This means the less time is
available to recover the development cost and at the end, the firm is unable
to compensate for the money invested to develop the product. The answer is
to the ‘ problems of R&D in…not ‘problems of financing….’…be careful to look
at the key phrases.. 5/8
c) Analyse the effects of having a balanced product portfolio.

A balanced product portfolio…description!! is important as it helps the


managers to determine strategy of the firm. A firm that is able to adapt to
the changes of the consumers’ behaviour and also the external changes is
the firm that stands a chance of doing well in the market…. Hence, firm that
owns a diverse and balanced product portfolio is the market leader???.
Besides that, by increasing(widening???) the product mix and the product
ranges, the firm can generate more revenue and spread it risks. Moreover,
the firm can enjoy the risk-bearing economies of scale. This kind of firm
called conglomerate can spread its fixed costs such as advertising or
research and development across its wider range of operations( good
analysis—facts and its consequences are developed. Unfavourable trading
conditions for certain products or even industries can be offset by more
favourable conditions in other better products such as cash cows or
sometimes stars products. (However)evaluation/ balancing point, the costs
and complexities in maintaining the diverse and balanced product portfolio if
far easier said than done. This is because different products require different
sets of marketing mix. Although the portfolio is balanced, all products cannot
be marketed in the same way. In order for a firm to remain competitive, it will
have to plan in detail on the product strategy, like applying NPD while
managing a balanced product portfolio. However, a balanced product
portfolio can be a part of the extension strategies for certain mature product.
For products at the maturity and saturation stage, the firm has to prolong the
time for it to retain the high sales and to delay the declination of the
products. Therefore, as one product declines so other products are being
developed and introduce to take place. Thus, the cash flow should be
reasonably balanced because there are products at every stage at the
product life cycle. Almost a full/ balanced analysis, but the tools of product
p/folio at all not mentioned!!! 5/7

d) Discuss the importance and roles of branding

Name sign logo symbol slogan identity differentiation legal protection price
inelastic packaging price promotion distribution individual brand family brand

Branding is the form of differentiating a firm’s product from those of its


competitors and a brand refers to a name that is identifiable with a product of
a particular business. The first role of branding (is branding as a logo)…can’t
agree with you!!!. Logo can be a form of symbol, sign or even catchy slogan.
Visual representation is very important as it can help break the international
barrier. This is because although the people do not comprehend the
languages, the sign and logo of the brand are universally accepted by
customers around the world. Logos ….brandingggggare also vital sources of
differentiation. Besides that, logos can also reduce the cost of a business to
advertise the brand. For instance, brands are often abbreviated instead of
having a lengthy brand as it is cheaper promotion that way. Another
importance is branding also acts a legal instrument. Since the branded
product is now a household name in its market, the distribution of the
product is wider and the firm is able to generate more revenues as more
customers can be gained. Legal identity of a product can be created by
providing it with one of a kind and familiar name and image of the
product…..advantage of having a brand as a legal protection!!!!!. Another
form of differentiation…..repetition, branding makes the product distinct from
other products and can serve to meet the physiological needs of employees,
suppliers and customers. Besides that, branding provides legal advantages
and lawful ownership of the product as any other products cannot be named
or adopting the same brand as other product. The copyright protection helps
prevent fraud and illegal branding. Next, branding is also a sale generator.
This is because branding can reduce the price elasticity of demand and the
product is price inelastic since customers are less sensitive to changes in
price. This is because, branded products as seen as better and superior, even
when the price charged is higher. Consequently, the firm can earn high sales
revenue since the firm is able to charge a high price and at the same time
retain the loyalty of the customers. Another role of branding is to create
customer royalty. The branded goods can make the customers feel satisfied
and happy to buy the products. Hence, the packaging of the product shall
includes the brand names also as customers can be more aware with the
product. Individual brand may attempt to brand individual products with
individual brand names. This can help the individual brand to be developed
for its market segments. Also, failure by one brand will not have an adverse
effect on the others. Family brand means a business which uses only a brand
name for different products. The importance of this strategy is the marketing
campaign can be spread across a range of products and the firm can enjoy
marketing economies of scale. Besides that, a customer who might has
bought one product but as the sense of loyalty and confidence on the brand,
the customer will buy other product under the same name. needs better
structure___( Defin of branding, then roles…..facts and consequences &
limitations). Overall, partial discussion….limitations of branding??? 5/10
Total 20/30

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