New Products the Two-Dimensional Matrix Concept Is

New Products The two-dimensional matrix concept is common in business strategy. There are a number of matrices that can be used to help understand a business or the opportunities that exist. A product positioning matrix can help to determine where the best opportunities lie (SmartDraw, 2008). For example, the bubble gum product idea would show that the product itself is not differentiated, but the collector containers would help to differentiate the product. The holders themselves, however, do not add value.

The axes of any two-dimensional matrix are flexible -- they can be whatever dimensions management wants to study. If cost is on the matrix, then the cost of obtaining the rights to the album covers is an important consideration. Cooper (2001) proposes a matrix featuring "products" and "markets" to help identify good product ideas that might fit specific markets. For example, the bubble gum market has certain demographic characteristics. The better the product matches up with the market, the more likely it will be to succeed.

If the bubble gum market is the same as the CD-purchasing market, the product might work. If it is not, then a better gimmick to sell come should be devised. It could be that gum purchasers are too young to buy CDs -- the appeal could be a toy or cartoon character in that case. Another two-dimensional matrix is the perceptual map. Better used with established products, the perceptual map outlines highlights the positioning in the market of current brands.

It can help an established brand to understand its place in the industry, but it can also be used to devise new products by finding gaps in the current marketplace (BrandingStrategy, 2009). The application of perceptual mapping in new product development is fairly straightforward. The first step of the process is to define the two dimensions that need to be studied. These should be based on the factors that the predominant consumer preferences in the industry (Greenacre, n.d.). In gum, that is probably going to be price and differentiation.

Then, the map must be populated. All of the different gum brands should be included, based on their combination of price and differentiation. The idea that you have should also be included. In this case, we have a differentiated gum that would be priced at a premium because of the cost of the packaging and the licensing rights. The perceptual map would probably reveal that the product does not have sufficient differentiation to justify the price that would need to be charged.

This leads to the next stage, which is testing the different ideas that have been brainstormed, to see where they fit on the map. A gum with a low cost but high level of differentiation would be the most competitive; with a high cost and low differentiation would be the least competitive. The ideas that are closer to the ideal would be the ideas that the company would want to pursue more vigorously.

It is important to remember that while two-dimensional mapping can be a powerful creative tool, it is a garbage in-garbage out situation. If the axes are chosen poorly, the tool will perform poorly. If the assessments of the brands on the map and your own idea are not honest and objective, then the maps cannot help. It is imperative that the map is used properly to make honest assessments, so that the information that.