New Product Development

I'm excited about my New Product Development class this trimester. It is one of the key courses professional marketers take in b-school. The class covers how to identify current issues in the marketplace using not surveys, but one on one interviews with consumers, then innovating using deduction. Consumers won't tell you directly what would be a good idea for a new product, you have to figure it out on your own with data. Henry Ford said "If I'd asked my customers what they wanted, they'd have said a faster horse", meaning customers don't always know what is best. Of course many of us have benefited from the development of his product. Apple doesn't do much surveying for that very reason and that is part of they they are so successful with the iPad, because they are good at creating artificial needs.

We will use a little calculus (which frankly I'm a little scared about because I'm terrible at it!) to interpret perceptual maps of customers's views of different products and their attributes. Using that data, companies can gain marketshare by creating products that fill certain needs. 

Part of the class is also learning how to forecast sales for a product that hasn't been sold yet or has a short history. A marketing professor by the name of Bass consulted RCA when color TV's were an emerging product. He predicted that in two years from the time they had him come on board that color tv sales would flatten. RCA disregard that information and invested a lot in production capacity because they thought there was virtually no limit to the future sales of their units. Turned out Bass was right and RCA lost a lot of money on that division.

I'm excited about this course and hope I can pick up a few things to know how to bring successful new products to market.