NPD the Product Is a Transformational Chair

NPD

The product is a transformational chair for kids, marketed in South Korea. The paper will focus on the market itself. The product is expected to be relatively unique, because it will have added features like wearable feeding bottles, temperature measuring baby dish and baby cocoons. The target market for the chair is the parents of young children, typically urban with a good education and relatively high income. The end users are children between 6 months and 4 years.

Market Analysis

South Korea has one of the lowest birth rates of any nation, which means that the population of young children is decreasing. The birth rate of 8.42 per 1000 of population, which ranks 216th in the world out of 222 countries. As such, the market trends for transformational chairs are not great. That said, South Korea has a population of 48,955,000 people. This means that in any given year, there will be 412,201 births. The target end user market consists of 3 1/2 years' worth of babies, so a total end user market of 1,442,700 will exist in South Korea at any given time.

The low birth rate implies that South Korean parents have few children. As such, there is less risk that parents will hand down their chairs from one child to another. Only parents with more than one child would do that, and many Korean parents only have one child. While there is a minor trend towards non-Koreans living in South Korea (Choe, 2012), this trend is too small to make a difference in the nation's birth rate or in the market for our product.

As a general rule worldwide, birth rates decline with wealth. There are a few exceptions, for example in Arab countries where the locals still retain high birth rates despite high wealth and a lack of opportunities for young people in those countries. However, because each new child is an opportunity, there is room to build a market for this product. It is recommended that the company focuses first on the Korean market, then begins to export to other markets. There are likely to be significant differences between the needs of parents in different markets, because of strong cultural differences with regards to child-rearing, and therefore it is important that the product is developed with just one market in mind.

Olsen (2011) reports that parents in developing nations spend at least $10,000 in a baby's first year on all items, and this level of spending can likely be extrapolated to the Korean market. The South Korean GDP per capita is $32,400 and the country is 83% urban, so it is completely reasonable that a South Korean family can afford to make investments in the comfort of their children and buy products with enhanced features that improve the lives of the family.

Buyer Behavior

We know that Koreans can afford to purchase the transformational chair, but are they willing to? The purchase decision is likely to be made by the mother, who will be in her late 20s or early 30s. The mother will control family finances, at least in terms of child-rearing expenses, and will be the primary caregiver. Thus, it is important that the value of the product is adequately conveyed to the mother in order to make the sale. In addition, pricing and distribution need to support the needs of the mother. With later marriages, fewer children and greater incomes, the Korean market is well-suited to this product and Korean mothers are likely to make such investments in their children.

Needs Assessment

There are several needs that should be conveyed to the target audience. Functionality is the most important attribute, as these types of chairs serve a specific purpose for young children. They can restrain a child, but they can also provide a tremendous amount of stimulation and can do all of this safely. For example, the tactile development of a child benefits when they are exposed to tactile stimulation (Koch & Fitzgerald, 2013).

Mothers also want to know that there is a positive value proposition for the family. For example, the product should be durable, and it should be scalable to suit the needs of the child for its early childhood, even as it grows. Also, the chair should come in with a decent price point. While this is certainly a premium product relative to the competition, it should only be priced at a slight premium. Moreover, it has to be 100% safe. This is not just a matter of adhering to Korean law on the matter, but also because parents will not purchase a product that is not 100% safe for their children.