Free «New Products Management» Essay
Table of Contents
The unique innovative product proposed for implementation belongs to a home product category. The name of the product is shoe-polisher machine in the shoe closet. It is recognized that the new invented machine makes business people life easier: its users will be able to make their life less burden as the machine saves time, it is convenient and appeals with affordable/reasonable price. The target market will be middle white collar class, particularly working people who usually wear suit with formal shoes. The unique characteristics of the product will benefit both genders and attract early adopters of a product. The reasons for making purchases vary among buyers. Such features as status symbols, prestige, utility, economy, price, service, and warranties may appeal to different segments of the market.
The business type will be sole proprietorship. The key partners of the company will be giant retailers such as Costco, Target, Wal-Mart, Bed Bath, etc. Also, the shoe-polisher machine will be distributed though web sellers such as Amazon.com and Zapos.com, the furniture stores (Ikea and West Elm). Examples are licensing agreements, or other arrangements with export houses, and foreign importers who buy the product or take it on consignment and control its distribution (Johnson and Scholes 62). Mass collaboration may be bolstered by a hard selling effort designed to get wholesalers and retailers to promote the product. At the other extreme, the manufacturer may hope to pull the product through the channels to the market by cultivating the ultimate consumers (Levy and Weitz 87). For example, manufacturers may advertise to their customer's customer, thereby creating effective demand, and force wholesalers and retailers to handle the product (McDonald 54).
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The main customers of the shoe-polisher machine belong to middle class white collar workers. Motivation will involve the stimulus, inducement, purpose, or want behind an action. The energizers of motivations are various drives including the visceral, such as hunger, thirst, air-getting, sex, and temperature regulation; activity drives, such as exercise, rest, preservation of rhythm, and novelty. Many of potential customers have high value of shoes and nee clean outlook (Crawford 2002).
Accounting will help to analyze and forecast sales and marketing needs. .Such analysis requires the development of different cost information, with cost classifications normally supplied by accounting statements. But generating relevant cost information from accounting statements, though conceptually simple, is actually quite complicated. The main work characteristics I will look for when hiring your accounting staff are honesty, high professionalism and experience in start-up business (Crawford 2002).
Accounting monitoring will be conducted through the study of quotas, sales-perform- ance ratios, turnover ratios, investment and profit ratios, growth indicators, techniques of advertising measurement, and the evaluation of marketing personnel. It continuously gathers information about such aspects of marketing activity as costs, and the profitability of products, customers, and territories. In so doing, it assesses the effectiveness of salesmen in terms of quotas, number of calls, and volume; it ascertains the efficiency of various types of distribution channels by volume and profit ability; and it determines the cost of different techniques of storing and handling inventories, which it evaluates against established or implied standards. Based on assessment of performance, some realignment of the marketing program may be made. Adjustment implies power -- the power to control. Budgets will establish standards that, if achieved, direct a company to objectives. Through a check of actual against budgeted performance, discrepancies can be noted, the reasons for them analyzed, and the need for adjusting marketing activity pointed out. This activity provides management with the basis for sound marketing control. Even where standards are set, however, it is not expected that performance will correspond exactly. Rather, tolerances are established and corrective action is taken when performance falls outside the range of tolerance. Budgets serve to keep the marketing mix in balance, for it is through them that expenditures on diverse marketing activities are kept in line with the overall plan. Budgets integrate and coordinate marketing activity and marshal marketing resources to realize desired outputs. But marketing also plays a key role in total budgeting. A most significant item in a budget is estimated sales, which are based on the sales forecast. Given estimated sales, the anticipated expenditures necessary to generate and support the sales volume are presented. However, since sales and expenses are interrelated, forecasts in turn depend on supporting marketing programs. For instance, an increase in the sales of a territory may require an increase in the supporting marketing program and hence additional ex- Distribution cost analysis is one of the most widely used quantitative approaches to marketing control. Since it provides a method of estimating costs and profits associated with product lines, customers, salesmen, or market segments, it is also useful for planning. For example, to calculate the profitability of a salesman, advertising, product development, delivery, and administrative costs must be allocated to the products he sells and subtracted from his sales volume. Distribution cost analysis splinters diverse activities into a number of smaller ones and so functionalizes costs (Crawford 2002).
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The shoe-polisher machine is a unique product appealing to a particular class of consumers. The time required for a new product to gain widespread acceptance varies directly with the complexity of the change, there is a difference between a fundamental and an adaptive innovation. The rate also varies with the cost of the product, the visibility of the innovative aspects, and the ease of changing customer habits. The initial costs of cultivating a market may be heavy. Management can choose among alternative policies. At one end of the scale, management may choose to push the product through the distribution channels to the market. It may do so by undertaking expensive advertising campaigns. Among the factors that govern the advertising and sales programs that should be selected are the degree of newness of the product, the existing degree of competition, the ease of entry of competitors who offer similar products, the brand loyalty of customers, the company image, and the corporate niche in the marketplace.