New Product Management Overview- American

New Product Management

Overview- American and Western European consumers expect the introduction of thousands of new food products each year into the consumer and fast-food markets. This has been an ongoing trend over the past few decades, and product extensions and line extensions have expanded annually since the early 1980s. There are several factors driving the pace and veracity of these new introductions. On the consumer demand side, the insistence on greater convenience, healthier and safer products, unique or specialty diets and considerations, variety, and ethnicity drive the market. On the supply side, retailers have grown in sophistication and capacity to handle and manage more categories and especially to become more responsive to slight changes in consumer preferences (Krishnan and Ulrich, 2001).

NPD Systems -- For modern consumer food companies to remain successful, then, the New Product Development process must be robust, ongoing, and systematized; indeed, there must be a strategic commitment to the overall long-range process from senior management for the process to remain viable (Anderson, 2008, 553).

NPD Research and Development -- With so much focus on NPD in the food industry, one must not forget the basic strategies of marketing research and the core reason for such -- to find the best possible product for the market and launch in the most cost effective and profitable manner. Cross functional communication and collaboration on marketing issues are key to any NPD template, as is the strategic reliance on such issues as customer orientation and product fit (Suwannaporn and Speece, 2003, 169). Some argue that it is the older models of product introduction that fail more than the product itself. Instead, they argue, NPD can only be robust when it becomes a cross-functional project managed by a group; hopefully, with ties to the market. This newer, multi-disciplined and enhanced communicative model is called the Multiple Convergent Processing Model of New Product Development (Hart and Baker, 1994, 77-9).

NPD Best Practices and Innovations -- Innovation is often the key to strategy, when combined with the right marketing mix. Of late, though, the industry has been policing itself and concerns have arisen regarding the number of new products flooding the market each year, and whether those products are positives or actual deterrents to the industry. Simply placing a new label on a product and announcing that it is more effective than ever in "treating X" may constitute a brand extension, but it is, over time, problematical for long-term efficacy and customer loyalty (Lehman, 2006, 8).

NPD Measurement and Quality Implementation -- Of course, without proper measurement metrics, any NPD model will fail, and it is within the metrics that decisions for the next round of strategy will occur (Anderson, 557). Change is necessary within all frameworks of business. Just as demographics and psychographics evolve, so must the food industry. However, innovation for the sake of innovation is likely not the direction the industry should pursue, but rather a more studied approach and utilization of the tools of Innovation Management to drive quality and proactive implementation of new food products (Costa, 2008).

Conclusion and Future of NPD -- Historically, there has been a high rate of failure within the food industry's NPD. This might be the result of too many products bombarding the market- striving for market share, or the lack of quality and confirmable research (Stewart-Knox and Mitchell, 2003, 58). Scholarship reveals just how important marketing research is prior to the launch of any new product. That, combined with an industry agreed upon standard of Best Practices, should provide a greater framework by which continual, and fluid, strategic management issues occur (Kahn, et.al. 107). NPD, while essentially a commercial function must, however, give greater attention and belief to the large amount of research that indicates and improvement in quality standards can only be met through a better understanding of consumer behavior. Granted, a CEO may receive only 120 consumer complaints about a product that has shipped in the millions, but that is not the cause for retooling or regenerating a new "improved product." Instead, utilize the marketing and scientific paradigms to improve decisions and increase ROI (Krishnan and Ulrich, 15).