Market Attractiveness of New Products, 2001 Hot Melt Symposium Proceedings

Robert W. Smith--Implementing sustainable growth via successful new product development programs requires more than competent technical development. Various methodologies such as stage gate processes have been developed to help businesses better manage the actual development process. However, before new product development initiatives are begun, a business should understand how the resultant product or product line will fit into their own product portfolio, and how the offering will fit the targeted market. The only thing worse than no product development is development of the wrong product for the wrong market. Product development resources are scarce in today’s fast paced business environment and no organization can afford to direct these resources down the wrong path. A business must understand the integrity of the market they are trying to serve, be it an existing market, or a new market the business has not formerly participated in. The external and internal forces impacting a market’s integrity must be understood before key decisions on new product development are considered. The external forces of both the bargaining power of suppliers and customers must be considered, along with threats of new entrants and substitute technologies assessed. All these forces come to bear in the rivalry among existing and new competitors. Only with such an understanding can business direct its product development efforts to maximize their position in the value chain and enjoy an attractive share of the total profit pool.