Npd Case

1. If you were guiding development of a new high-technology camera, what steps would you take in each of the stages of the new-product development process?

Idea generation. The key point to communicate to students is that everything flows from the target market. That is, the development of new products should derive from customer needs. Many companies develop products or services and then go looking for customers. This is putting the cart before the horse. Sometimes companies get lucky, but developing products first is a risky way to run a business.

The case indicates that Canon and its partners, in developing the APS system, did consider customer needs. They were trying to eliminate many problems that customers experience with 35mm film. The new film has no "leader" and has several interesting features that make the system "idiot proof."

However, students may suggest that the case does not provide evidence that consumers are demanding small, high-tech cameras. The case opens with the scenario of an engineer challenging the staff to develop a camera no bigger than a cigarette case. We don't know what caused that request. Was it based on market research, or was it based on the engineer's belief that Canon could make a small camera and that consumers would want it?

Idea screening. Students will suggest that, in the case of the high-technology camera, researchers might well have generated many possible ideas for new cameras. This raises the question of what criteria a company should use to select which, if any, of the ideas to pursue. Here again, students should recommend that we would want to establish criteria based on target customer needs. If customers want auto-focusing capability, for example, one criterion would be whether or not a particular idea offered this feature.

Concept development and testing. Given one or more ideas have passed the screening process, students will recommend that the company would then develop some prototype models or mock-ups that it could test with target consumers. Here again, we see the importance of selecting the appropriate customers for these tests. The more realistic the prototype products can be, the better the testing. Students should see the problem new, high-tech products create. It is often not possible to produce only a few of such products. How much would it cost to develop one Canon Elph or one microwave oven? Thus, we are often dependent on written concept descriptions or mockups that may not give the consumer a real feel for the products.

Marketing strategy development. Given completion of the prior stages, we would now develop the marketing strategy. As the test indicates, we would begin with as clear and specific a definition of the target markets as possible as well as estimates of the potential and penetrated market sizes, given the desired positioning. Then, we would develop the marketing mix along with a budget for