Launching new products to market is a prerequisite for acquiring a competitive advantage. Product managers are faced with a very huge challenge in bringing world-class products to the market in time. This builds up pressure on their line of work which is brought about by factors such as the accelerating rate of technological development, improved mass communication, intensified competition brought about by maturing markets and globalization, fragmentation of the marketplace due to the change in demographics, shorter product life cycles and the escalating cost of R&D. Companies are required to master their product strategy that separates enduring success from failure (Hsu, 2013).
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The new product development involved in business planning and engineering is the process of introducing a new product to the market. This process involves two parallel paths where one requires the idea generation. This is where the product is designed and engineering details given. The other step involves market research and marketing analysis. New product development is basically the first stage of generating and commercializing new products within the overall strategic process of product life cycle management. This process is used in maintaining or growing the market share in the company (Paliwoda & Ryans, 2008).
In order for a company to launch a new product internationally by giving consideration to the commercialization plan, the company must strategies on how to develop and manage their products. This will enable the company to compete effectively and achieve the organizational goals. In addition to this, the organization must be able to adjust its production mix.
One of the general implications of launching a new product internationally in terms of commercialization plan is the impact of the new product launch strategy of success after examining the relationships between the environment, the strategy and performance of the new product. This is done by effectively analyzing the behavior of the new product in various stages. These stages help in identifying the new product development where resources are allocated in order to identify market changes and seized upon new product opportunities before they occur. This process involves eight stages that help in analyzing the implications of launching a new product internationally in terms of the commercialization plan (Saji, 2103). The first stage is idea generation often referred to as the NPD process. This is where ideas for new products are obtained by considering the SWOT analysis (Strengths, Weaknesses, Opportunities and Threats). The market and consumer trends are considered as well as the competitors and other factors involved. The next stage is the idea screening process which focuses on eliminating the non-applicable concepts before allocating resources to them. This stage involves answering questions such as: what is the current or expected competitive pressure for the product idea? What are the industry sales and market trends the product is based upon? These are some of the questions that help in identifying the effects of launching a new product internationally.
The other stage involved the concept development and testing. This is where the marketing and engineering details are developed. The effect of this stage is that the intellectual property issues are investigated and searched on the international markets depending on the commercializing plans of the organization. It answers various questions such as: how will the consumers react to the product? How will the product be produced most cost effectively? What benefits will the product provide? What will it cost to produce the product? These questions will help in analyzing the general effects if launching a new product internationally by considering the commercializing plan. The effect of this is that the international markets will be deeply considered and the production process improved to serve the international market. The next stage is the business analysis (Saji and Mishra, 2013). This is where estimates in terms of sales, profitability and selling process are made. The effect of this is that the organization will have to consider the prices they sell their products at in order to suit the customers in the international market and ensure that they make profits.
In addition to this, the technical implementation process is very vital in the launching of a new product. It involves the new program initiation, resource estimation, supplier collaboration publishing technical communications just to mention but a few. This impacts the launching process in that the organizations have to strategize on new ways of implementing technical aspects that will better serve the new product. The next stage that follows is the commercialization process (Paul & Kapoor, 2008). This one involves launching the new product, placing advertisements and promotions on the new product and filling the distribution pipeline with the product. The critical path analysis is the most important stage. The other process involved in the launch of a new product is the new product pricing. This stage involves considering the impact of the new product and its entire portfolio, it also requires the internal and external analysis of the value of the new product. This stage also requires that the competition and alternative competitive technologies are considered. Different value segments are also put into consideration in terms of the price, value and need of the product.
The products variable and fixed costs are also analyzed to validate the requirements of launching the new product. This stage also requires that the revenues and profits and predicted in term of unit volumes. The impact of this is that it helps in forecasting future increases in price to enable the organization in producing more products or securing the products to prevent losses. The implications of launching the new product internationally in terms of the commercialization plan are that the markets and trends involved are thoroughly considered to determine the behavior of the product. It also shows the steps that the organization should take in order to ensure that their products are available to the customers in good time. Another impact is that the production process is improved to ensure that the product is available in good time to the international markets. The initial strategies of the organization are also changed (Saji and Mishra, 2013). Another impact of launching a new product is that new technology aspects are introduced into the organization as well as new patents draw for the product. This requires proper strategizing of the organizational objectives.
References
Frishammar, J; Lichtenthaler, U and Rundquist, J. (2012). Identifying Technology Commercialization Opportunities: The Importance of Integrating Product Development Knowledge. Journal of Product Innovation Management, 29 (4), 573-589.
Hsu, D. H. and Ziedonis, R.H. (2013). Resources as dual sources of advantage: Implications for valuing entrepreneurial-firm patents. Strategic Management Journal, 34 (7), 761-781.
Paliwoda, S. J., & Ryans, J. K. (2008). International marketing: Modern and classic papers. Cheltenham, Glos: Edward Elgar.
Paul, J., & Kapoor, R. (2008). International marketing: Text and cases. New Delhi: Tata McGraw-Hill.
Saji, K.B. and Mishra, S. S. (2013). Investigating the role of firm resources and environmental variables in new product commercialization. Journal of Product & Brand Management., 22(1), 18-29.
