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Q1. Explain the stages in the new product development process.

Ans.
The new product development process has the potential to be haphazard because of the inherent uncertainty in the process, as well as the myriad methods available for product development. Setting up an organizing framework to identify the stages in the process, and the methods applicable to each stage, should help in bringing order to the process. Our purpose in this article is to lay out a framework and identify key methods that are most likely to be useful in each stage. The focus here is on methods that use quantitative data collected mainly through the web thus bringing more validity and flexibility to the process along with speed to market. We envision the new product development process as an iterative multistage process as shown in Figure 1.

This is a straightforward way of looking at the process that starts with idea generation, moves to development of individual features and then to full product development and finally into product testing. Of course, this is one example of how the process can be viewed and not a rigid framework. There has to be considerable fluidity in the system to accommodate feedback, skipping of stages, use of new methods and perhaps introduction of new stages.

Idea Generation
Many methods are available for the idea generation stage such as brainstorming, Delphi and focus groups. The basic approach is to harness creativity in some form for the development of new ideas. While there is much to recommend for the more qualitative approaches, one of the drawbacks is the lack of quantitative validity to the ideas at this stage. That is, the ideas have not been shown to have popularity in the constituency that matters the customers. We have found that the Smart Incentives approach can provide both creativity and validation in the same step. Respondents to a survey compete with each other to produce ideas thus introducing creativity into the process. The generated ideas are then evaluated by a peer group to provide the required market validation. This approach can be useful for generating ideas on both whole products and individual features.

Feature Development

Feature development is the process of identifying features that would be of interest to customers. Traditional methods such as Importance Scales can be used, but may not provide sufficient discrimination between features. Pairwise comparisons of features are a straightforward method for identifying feature importance. The task is simple, but can be tedious if a large list of features needs to be culled. More recently developed methods such as Max-Diff scaling can provide a better alternative. Max-Diff is similar to pairwise comparison, except that more than two features are evaluated at a time (3-5) and the most and least preferred alternative is chosen from each set. Some advanced statistical analysis on the back end provides a score for each feature that is generally more discriminatory than a regular importance scale. Another alternative is the Kano method where the positive and negative aspect of each feature is rated in order to distinguish the must have features from the nice to have features. The final method in this stage (that straddles this and the next stage) is the Self-explicated Method (SEM). Respondents rate the desirability of each level of each attribute as well as the importance of each attribute. Combining these two pieces of information gives attractiveness scores (similar to conjoint utilities) for each attribute level. Although all attributes and levels are rated by respondents (as in conjoint analysis), since they are presented individually, this method may be more appropriately seen as useful for feature development.

Product Development
In this stage, combinations of features are used to build or evaluate the product. The Configurator allows survey respondents to build their ideal product by selecting from a list of available features. Usually prices are provided at the feature level to ensure that respondents make realistic decisions. As respondents build their own ideal products, the most popular features and feature combinations rise to the surface, resulting in the automatic development of preference based market segments. The Optimizer is different in that respondents make choices from among fully formed products. Information from their choices is taken into account in creating successive products that are more preferred till the process finally converges on the respondents ideal product. This method is more appropriate when the design and packaging (i.e. the visual element) is more important. As with the Configurator, the market segments itself into preference based segments. The various flavors of conjoint (such as traditional, discrete choice, adaptive) can also be used in this stage to identify feature importance. But care has to be taken to ensure that the basic assumptions are met and that the right type of conjoint is used.

Product Testing

Conjoint analysis can be fruitfully used in this stage also to estimate the interest in various product combinations and especially in running market simulations. The latter ability is very important in cases where a strong competitive market exists and reasonable estimates of take rates and ability to choose the ideal combination for the market are requisites. Concept testing is much more limited than conjoint and is usually used when the product is almost set except for perhaps one or two questions, often relating to price. In short, the chaos of the product development process can be structured, and appropriate methods applied, to gain maximum benefit at different stages

Q2. Explain the steps in Marketing Research Process

Ans. Step 1. Define the Objective & Your Problem


Perhaps the most important step in the market research process is defining the goals of the project. At the core of this is understanding the root question that needs to be informed by market research. There is typically a key business problem (or opportunity) that needs to be acted upon, but there is a lack of information to make that decision comfortably; the job of a market researcher is to inform that decision with solid data. Examples of business problems might be How should we price this new widget? or Which features should we prioritize? By understanding the business problem clearly, youll be able to keep your research focused and effective. At this point in the process, well before any research has been conducted, I like to imagine what a perfect final research report would look like to help answer the business question(s). You might even go as far as to mock up a fake report, with hypothetical data, and ask your audience: If I produce a report that looks something like this, will you have the information you need to make an informed choice? If the answer is yes, now you just need to get the real data. If the answer is no, keep working with your client/audience until the objective is clear, and be happy about the disappointment youve prevented and the time youve saved. Step 2. Determine Your Research Design Now that you know your research object, it is time to plan out the type of research that will best obtain the necessary data. Think of the research design as your detailed plan of attack. In this step you will first determine your market research method (will it be a survey, focus group, etc.?). You will also think through specifics about how you will identify and choose your sample (who are we going after? where will we find them? how will we incentivize them?, etc.). This is also the time to plan where you will conduct your research (telephone, in-person, mail, internet, etc.). Once again, remember to keep the end goal in mindwhat will your final report look like? Based on that, youll be able to identify the types of data analysis youll be conducting (simple summaries, advanced regression analysis, etc.), which dictates the structure of questions youll be asking. Your choice of research instrument will be based on the nature of the data you are trying to collect. There are three classifications to consider:

Exploratory Research This form of research is used when the topic is not well defined or understood, your hypothesis is not well defined, and your knowledge of a topic is vague. Exploratory research will help you gain broad insights, narrow your focus, and learn the basics necessary to go deeper. Common exploratory market research techniques include secondary research, focus groups and interviews. Exploratory research is a qualitative form of research. Descriptive Research If your research objective calls for more detailed data on a specific topic, youll be conducting quantitative descriptive research. The goal of this form of market research is to measure specific topics of interest, usually in a quantitative way. Surveys are the most common research instrument for descriptive research. Causal Research The most specific type of research is causal research, which usually comes in the form of a field test or experiment. In this case, you are trying to determine a causal relationship between variables. For example, does the music I play in my restaurant increase dessert sales (i.e. is there a causal relationship between music and sales?). Step 3. Design & Prepare Your Research Instrument In this step of the market research process, its time to design your research tool. If a survey is the most appropriate tool (as determined in step 2), youll begin by writing your questions and designing your questionnaire. If a focus group is your instrument of choice, youll start preparing questions and materials for the moderator. You get the idea. This is the part of the process where you start executing your plan. By the way, step 3.5 should be to test your survey instrument with a small group prior to broad deployment. Take your sample data and get it into a spreadsheet; are there any issues with the data structure? This will allow you to catch potential problems early, and there are always problems. Step 4. Collect Your Data This is the meat and potatoes of your project; the time when you are administering your survey, running your focus groups, conducting your interviews, implementing your field test, etc. The answers, choices, and observations are all being collected and recorded, usually in spreadsheet form. Each nugget of information is precious and will be part of the masterful conclusions you will soon draw. Step 5. Analyze Your Data Step 4 (data collection) has drawn to a close and you have heaps of raw data sitting in your lap. If its on scraps of paper, youll probably need to get it in spreadsheet form for further analysis. If its already in spreadsheet form, its time to make sure youve got it structured properly. Once thats all done, the fun begins. Run summaries with the tools provided in your software package (typically Excel, SPSS, Minitab, etc.), build tables and graphs, segment your results by groups that make sense (i.e. age, gender, etc.), and look for the major trends in your data. Start to formulate the story you will tell. Step 6. Visualize Your Data and Communicate Results Youve spent hours pouring through your raw data, building useful summary tables, charts and graphs. Now is the time to compile the most meaningful take-aways into a digestible report or presentation. A great way to present the data is to start with the research objectives and business problem that were identified in step 1. Restate those business questions, and then present your recommendations based on the data, to address those issues.

When it comes time to presenting your results, remember to present insights, answers andrecommendations, not just charts and tables. If you put a chart in the report, ask yourself what does this mean and what are the implications? Adding this additional critical thinking to your final report will make your research more actionable and meaningful and will set you apart from other researchers. While it is important to answer the original question, remember that market research is one input to a business decision (usually a strong input), but not the only factor. So, thats the market research process. The figure below walks through an example of this process in action, starting with a business problem of how should we price this new widget?

Q3. Write a short notes on : A. Marketing Plan B. Marketing Planning process


Ans. The Marketing Plan is a highly detailed, heavily researched and, hopefully, well written report that many

inside and possibly outside the organization will evaluate. In many respects, the Marketing Plan is the most important document produced by marketers as it not only helps to justify what has occurred in the past, but is critical for explaining where a company intends to go in the future. Th Marketing Plan is widely used by both large large corporate marketing departments and also by small startup companies. It is particularly important for marketers who seek funding for new projects or to expand existing products or services. Essentially the Marketing Plan:

forces the marketing personnel to look internally in order to fully understand the results of past marketing decisions. forces the marketing personnel to look externally in order to fully understand the market in which they operate. sets future goals and provides direction for future marketing efforts that everyone within the organization should understand and support. is a key component in obtaining funding to pursue new initiatives.

The Marketing Plan is generally undertaken for one of the following reasons: 1. Needed as part of the yearly planning process within the marketing functional area. 2. Needed for a specialized strategy to introduce something new, such as new product planning, entering new markets, or trying a new strategy to fix an existing problem. 3. Is a component within an overall business plan, such as a new business proposal to the financial community. There are many ways to develop and format a marketing plan. The approach taken here is to present a 6-Part plan that includes: 1. Purpose and Mission 2. Situational Analysis

3. 4. 5. 6.

Marketing Strategy and Objectives Tactical Programs Budgets, Performance Analysis and Implementation Additional Consideration

This plan is aimed at individual products and product lines, however, it can be adapted fairly easily for use in planning one or more strategic business units (SBU). The page length suggested for each section represents a single-spaced typed format for a plan focused on a single product. Obviously for multi-product plans lengths will be somewhat longer. It is assumed that anyone developing a Marketing Plan possesses a working understanding of marketing principles. If you do not, it is suggested you spend considerable time learning about basic marketing through the previous sections of the Principles of Marketing Tutorials. Note, throughout the plan the word "product" is used. However, the information presented in the Marketing Plan tutorials applies to both products and services. @ Marketing

Planning Process - Introduction

Author: Jim Riley Last updated: Sunday 23 September, 2012


Macdonald (1995) suggests that several stages have to be completed in order to arrive at a strategic marketing plan. These are summarised in the diagram below:

The extent to which each part of the above process needs to be carried out depends on the size and complexity of the business. In a small or undiversified business, where senior management have a strong knowledge and detailed understanding of the overall business, it may not be necessary to formalise the marketing planning process. By contrast, in a highly diversified business, top level management will not have knowledge and expertise that matches subordinate management. In this situation, it makes sense to put formal marketing planning procedures in place throughout the organisation.

Q4. Describe the international market entry strategies in brief

Ans. Exporting
Exporting is the most traditional and well established form of operating in foreign markets. Exporting can be defined as the marketing of goods produced in one country into another. Whilst no direct manufacturing is required in an overseas country, significant investments in marketing are required. The tendency may be not to obtain as much detailed marketing information as compared to manufacturing in marketing country; however, this does not negate the need for a detailed marketing strategy. Figure 7.2 Methods of foreign market entry The advantages of exporting are: manufacturing is home based thus, it is less risky than overseas based gives an opportunity to "learn" overseas markets before investing in bricks and mortar reduces the potential risks of operating overseas. The disadvantage is mainly that one can be at the "mercy" of overseas agents and so the lack of control has to be weighed against the advantages. For example, in the exporting of African horticultural products, the agents and Dutch flower auctions are in a position to dictate to producers. A distinction has to be drawn between passive and aggressive exporting. A passive exporter awaits orders or comes across them by chance; an aggressive exporter develops marketing strategies which provide a broad and clear picture of what the firm intends to do in the foreign market. Pavord and Bogart2 (1975) found significant differences with regard to the severity of exporting problems in motivating pressures between seekers and nonseekers of export opportunities. They distinguished between firms whose marketing efforts were characterized by no activity, minor activity and aggressive activity.

Those firms who are aggressive have clearly defined plans and strategy, including product, price, promotion, distribution and research elements. Passiveness versus aggressiveness depends on the motivation to export. In countries like Tanzania and Zambia, which have embarked on structural adjustment programmes, organisations are being encouraged to export, motivated by foreign exchange earnings potential, saturated domestic markets, growth and expansion objectives, and the need to repay debts incurred by the borrowings to finance the programmes. The type of export response is dependent on how the pressures are perceived by the decision maker. Piercy (1982)3 highlights the fact that the degree of involvement in foreign operations depends on "endogenous versus exogenous" motivating factors, that is, whether the motivations were as a result of active or aggressive behaviour based on the firm's internal situation (endogenous) or as a result of reactive environmental changes (exogenous). If the firm achieves initial success at exporting quickly all to the good, but the risks of failure in the early stages are high. The "learning effect" in exporting is usually very quick. The key is to learn how to minimise risks associated with the initial stages of market entry and commitment - this process of incremental involvement is called "creeping commitment" (see figure 7.3). Figure 7.3 Aggressive and passive export paths Exporting methods include direct or indirect export. In direct exporting the organisation may use an agent, distributor, or overseas subsidiary, or act via a Government agency. In effect, the Grain Marketing Board in Zimbabwe, being commercialised but still having Government control, is a Government agency. The Government, via the Board, are the only permitted maize exporters. Bodies like the Horticultural Crops Development Authority (HCDA) in Kenya may be merely a promotional body, dealing with advertising, information flows and so on, or it may be active in exporting itself, particularly giving approval (like HCDA does) to all export documents. In direct exporting the major problem is that of market information. The exporter's task is to choose a market, find a representative or agent, set up the physical distribution and documentation, promote and price the product. Control, or the lack of it, is a major problem which often results in decisions on pricing, certification and promotion being in the hands of others. Certainly, the phytosanitary requirements in Europe for horticultural produce sourced in Africa are getting very demanding. Similarly, exporters are price takers as produce is sourced also from the Caribbean and Eastern countries. In the months June to September, Europe is "on season" because it can grow its own produce, so prices are low. As such, producers are better supplying to local food processors. In the European winter prices are much better, but product competition remains. According to Collett4 (1991)) exporting requires a partnership between exporter, importer, government and transport. Without these four coordinating activities the risk of failure is increased. Contracts between buyer and seller are a must. Forwarders and agents can play a vital role in the logistics procedures such as booking air space and arranging documentation. A typical coordinated marketing channel for the export of Kenyan horticultural produce is given in figure 7.4. In this case the exporters can also be growers and in the low season both these and other exporters may send produce to food processors which is also exported.

Q5. Discuss the various Price adjustment options adopted by the companies

Ans. Employee pay is often tied to a companys fortune until things turn sour.
Multimedia

Graphic Options Repricing Gains in Popularity

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Times Topics: Credit Crisis The Essentials

Composite Technology, which makes electric cables and other products, decided in January to lower the price at which its workers could use their stock options to buy shares in the company. The managers and directors slashed the price on all of the companys 23.4 million options to 35 cents. The move still leaves the companys chief executive, Benton H. Wilcoxon, and others holding options that are underwater meaning the price of exercising the options is above the current market price. But now Mr. Wilcoxon will be able to book a profit if the stock price increases by less than half, rather than quadrupling. The repricing could be of particular benefit to Mr. Wilcoxon, who has a whopping 4.2 million options, previously priced at $1.13. The company lost $53 million in its latest fiscal year, and its stock fell to 27 cents on Thursday from as high as $1.36 last July. Executives at dozens of public companies, including Starbucks, Google, Intel and smaller enterprises like Composite Technology, are taking steps to lower the prices that their employees would have to pay to convert options into stock. The moves are usually described as important for retaining employees, especially as stock options that vest over several years look utterly worthless in the current market. With prices plunging across a variety of industries, companies also often assert that stock price movements are not really a reflection of employee performance.

But the moves leave shareholder advocates fuming. Owners of company stock reap no monetary benefit from repricing of options, advocates say only employees do. The process, in their view, is fundamentally unfair. Modifying the options means employees gain from stock price increases, while investors feel the brunt of stock price declines. A stock option is supposed to align the interests of employees and shareholders by putting them in the same boat, said Patrick McGurn, special counsel to the RiskMetrics Group, which acquired Institutional Shareholder Services in 2007. Repricing of options breaks that linkage. Many companies point out that it is not just the top executives who benefit. Google is giving all its employees a chance to swap their underwater stock options for new ones with a lower exercise price, pointing to the stocks nearly 60 percent decline from its 2007 high. Some companies are going further and specifically excluding top officials, perhaps sensitive to complaints that executive pay has gotten out of hand. Shareholders of Starbucks voted this month to permit a program that would allow the companys employees to exchange some options for fewer new options with lower exercise prices. And Intel on Monday asked shareholders to approve an option exchange program at its annual meeting in May. Both programs eliminated top officials and board members. While dozens of companies are now trying to reprice their stock options, the numbers are not as high as they were after the technology bubble burst earlier this decade, said Alexander Cwirko-Godycki, research manager at Equilar. But, he added, I am constantly surprised at the pace with which this trend is gathering steam. According to Equilar, which collected data for The New York Times on companies repricing activities, at least 25 companies modified option prices in the first three months of the year, either directly or indirectly by allowing employees to exchange options for new ones with lower exercise prices. At least 23 have proposed modifications this year. The total number of programs in various stages already exceeds the action in 2008, when 51 companies undertook repricings or exchanges. In recent years, stock exchanges have adopted rules that generally require shareholder approval for companies to reprice or exchange options. But there is more variety in the repricing programs adopted by different companies than in the past.

Like Intel, they are barring top executives and board members from having their option prices adjusted. Others are modifying the price adjustment based on the seniority of the employee holding the option. By comparison, a program by ValueClick, an online marketing company, to buy underwater options was open to all employees, as was the repricing plan carried out by Composite Technology. Market conditions are such that the share prices suffered despite the performance of management, rather than because of it, said James Carswell, vice president for investor relations at Composite Technology. It would be great if we could go back and reprice the stock purchase price to benefit investors, he continued. We dont have the ability to do that. Companies may have previously asked shareholders for blanket approval to change an options program. Google, for example, already had a plan in place that generally permitted an exchange of employees options, so the company did not give investors a say over its latest exchange. Mr. Carswell of Composite Technology said the company already had similar approval. A few companies have run into serious shareholder resistance. Managers of Arrowhead Research, a nanotechnology company based in Pasadena, Calif., did this month after seeking to lower option exercise prices. Shareholder feedback to the proposals, however, made it clear that there is significant concern over the repricing structure proposed, Christopher Anzalone, the companys chief executive, wrote in a letter to shareholders. It is critical to us that our shareholders have confidence that our interests are aligned, so we are withdrawing the proposals. Granting options is not likely to become less popular, though. Companies low stock prices are encouraging other companies to grant new options, said Jonathan Ocker, chairman of the compensation and benefits group at Orrick, Herrington & Sutcliffe in San Francisco. Im seeing more and more companies considering granting options now, because theres no place to go but up, Mr. Ocker said. He paused, then added, Its either going to go up or were in real trouble.
Q6. Define Personal selling and also explain the personal selling process. Ans. Personal selling is the most expensive form of advertising and to be effective one should use a step by step
process to gain the most benefit. Personal selling can adjust the manner in which facts are communicated and can

consider factors such as culture and behaviour in the approach. They can ask questions to discover the specific need of the customer and can get feedback and adjust the presentation as it progresses. The Personal Selling Process The personal selling process is a consecutive series of activities conducted by the salesperson, the lead to a prospect taking the desired action of buying a product or service and finish with a follow-up contact to ensure purchase satisfaction. Step One Prospecting - the first step in the personal selling process The process of looking for and checking leads is called prospecting or determining which firms or individuals could become customers. Up to 20% of a firm's customer base can be lost for reasons such as transfer, death, retirement, takeovers, dissatisfaction with the company and competition. A steadily growing list of qualified prospects is important for reaching the sales targets. Qualifying a prospect: A lead is a name on a list. It only becomes a prospect if it is determined that the person or company can benefit from the service or product offered. A qualified prospect has a need, can benefit from the product and has the authority to make the decision. Step Two The Pre-approach This stage involves the collecting of as much relevant information as possible prior to the sales presentation. The preapproach investigation is carried out on new customers but also on regular customers. Systematic collection of information requires a decision about applicability, usefulness and how to organise the information for easy access and effective use. Step Three The Approach The salesperson should always focus on the benefits for the customer. This is done by using the product's features and advantages. This is known as the FAB technique (Features, Advantages and Benefits). Features : Refers to the physical characteristics such as size, taste etc. Advantages : Refers to the performance provided by the physical characteristics eg it does not stain. Benefits : Refers to the benefits for the prospect. Eg. Saves you 20% on replacement cost. Step Four The Sales Presentation After the prospects interest has been grasped, the sales presentation is delivered. This involves a "persuasive vocal and visual explanation of a business proposition". It should be done in a relaxed atmosphere to encourage the prospect to share information in order to establish requirements. Some small talk may be necessary to reduce tension but the purpose always remains business. Step Five The Trial Close The trial close is a part of the presentation and is an important step in the selling process. Known as a temperature question - technique to establish the attitude of the prospect towards the presentation and the product.

Step Six Handling Objections Objections are often indications of interest by the prospect and should not be viewed with misgiving by salespeople. The prospect is in fact requesting additional information to help him to justify a decision to buy. The prospect may not be fully convinced and the issues raised are thus very important. It also assists the salesperson to establish exactly what is on the prospect's mind. Step Seven Closing the Sale This is the last part of the presentation. Many salespeople fear the closing of a sale. Closing a sale is only the confirmation of an understanding. Fear will disappear if the salesperson truly believes that the prospect will enjoy benefits after the purchase of the product. Step Eight The Follow-up The sale does not complete the selling process. Follow-up activities are very important and are useful for the establishment of long-term business relationships. It is important to check if the products have been received in good condition, to establish the customer is satisfied etc.