Types of New Products: New Product Lines, Product Improvements & More

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  • 4:03 Step 1 - New Product Strategy
  • 4:21 Step 2 - Idea Generation
  • 4:49 Step 3 - Business Analysis
  • 5:16 Step 4 - Development
  • 5:53 Step 5 - Test Marketing
  • 6:26 Step 6 - Commercialization
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Lesson Transcript
Instructor: Jennifer Lombardo
You will learn about the types of new product categories, such as new product lines or repositioned products, and the new product development process, from idea generation to commercialization.

New Products

Everywhere you go, there are advertisements for new products! In fact, thousands of new products are introduced to consumers and businesses every year. Ninja Corp's technology division, Ninja Tech, creates new products yearly. The tech company realizes that there are many benefits to new product development and being the first to market. Ninja Tech's advantages are increased product loyalty, increased profit margins, increased sales and leadership in the market. Although most consumers are bombarded with new product messages, did you know that there are specific categories of new products?

Categories of New Products

The only true new product category is called new-to-the-world products. These products are truly new because they create a totally new market and are only a small percentage of the new product category. Examples of this type of new product category would be microwave ovens, microprocessors and copiers. Ninja Tech's products would not fall into these categories.

The second new product category is new product lines. When a company offers a product from a new category that they haven't previously offered, then it would be a new product line. For example, Ninja Tech recently developed Ninja Tech Nutritional Bars to improve memory. Their previous products have all been technology related, and this entry into the food market would be considered a new product line.

Additions to existing product lines occur when a company adds a new product that solidifies its area of product offerings. For example, Ninja Tech recently showcased a new martial arts gadget that allows consumers to monitor their health during physical workouts. The product fits the overall Ninja Tech product line of spy gear, computers, tablets, phones, etc.

Another new product class that Ninja Tech also uses to increase their revenue is improvements or revisions of existing products. Ninja Tech uses the ad words 'New and Improved' on their packaging to increase consumer awareness and create interest. Most new and improved products are only slight changes, such as flavors, scents or maybe even slightly more product. Ninja Tech recently promoted its new and improved spy gear by focusing on improved spy distances and new colors.

Sometimes, a company's product has failing sales, and the marketing team needs to come up with a plan to rescue the product. Repositioned products are products that can be targeted or changed slightly to increase sales. For instance, Ninja Tech used to market a product called the Stretch Rack. The Rack allowed consumers to strap themselves into the device and turn a knob to slowly stretch their leg muscles. The product did cause some injuries, so Ninja Tech decided to revamp the product with new safety guidelines implemented to avoid torn muscles. The old Stretch Rack's name was also changed to Bodu Stretching Device.

The last category of new products is called lower-priced products. These types of products perform similar to competing brands at lower prices. Ninja Tech offers a basic spy kit that contains all of the big ticket items that they sell in a more basic feature offering.

Ninja Tech has decided to create a brand new product this month to sell nationally. The new product development process must be followed to ensure a successful product launch. The seven steps are:

  1. New product strategy
  2. Idea generation
  3. Idea screening
  4. Business analysis
  5. Development
  6. Test marketing
  7. Commercialization and new product

Step 1 - New Product Strategy

The first step in the development process for Ninja Tech is to examine corporate and marketing objectives to develop the most appropriate product for the company. Guidelines should be developed to make sure that the ideas fit the overall strategy. Ninja Tech had a meeting and the priorities have been established.

Step 2 - Idea Generation

Ninja Tech holds brainstorming sessions to develop new ideas for products. Other methods of creating ideas are asking current customers, employees, distributors, competitors and even vendors for ideas. Ninja Tech has an open door policy, and all year looks for feedback from all areas to develop new product ideas.

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