COMM 223 Lecture Notes - Lecture 11: Test Market, Instant Coffee, Betamax
Document Summary
Gillette is a master at using the product life cycle to consistently introduce new products. Marketers are often ahead of time and/or of the consumer. Many new products fail, increasing failure rate, 2012 98% Products under 5 years-old contribute 30% of profit (older products have more share) Internal sources: engineering & marketing, other employees, formal r+d: 3m"s 15% rule, launched in 1948. Idea screening: screen impractical and not feasible ideas. Ex product will be market leader, 10% growth rate. Separate tasks of sponsoring and evaluating the idea: concept development and testing. Cost of failure is high because of huge r+d cost. Competitors can hardly benefit from your test marketing. Very innovative product, can"t predict sales based on existing competitive products. Standard test market, controlled test markets, simulated test markets: lose reality and gain control as you move through the test markets, simulated test markets provide insights about decisions, commercialization.
