WHAT IS NEW PRODUCT DEVELOPMENT?
New product development (NPD) is the term used to describe the complete process of bringing a new product or service to market.
We carry our process of new product development in two parallel paths in first we start with the idea generation, product design and detail engineering then we make market research and market analysis. Companies typically see new product development as the first stage in generating and commercializing new products within the overall strategic process of product life cycle management used to maintain or grow their market share.
NPD is a process of developing a new product for the market. This type of development is considered the preliminary step in product development and involves a number of steps that must be completed before the product can be introduced to the market. NPD can be done to develop an item to compete with a particular product or may be done to improve an already established product. NPD is essential to any business that must keep up with market trends and changes.
THE PROCESS / STAGES OF NEW PRODUCT DEVELOPMENT:-
The different stages of new product development we are following can be summarized as
Idea generation
Idea screening
Concept Development and Testing
Marketing Strategy
Business Analysis
Product Management
Test Marketing
Commercialization
DEVELOPMENT OF A NEW PRODUCT FOR AN EXISTING ORGANISATION:-
Coca-Cola, the corporation nourishing the global community with the world's largest selling soft drink concentrates since 1886, returned to India in 1993 after a 16 year hiatus, giving a new thumbs up to the Indian soft drink market. In the same year, the Company took over ownership of the nation's top soft-drink brand and bottling network. Its brands are:-COCA-COLA, THUMS UP, SPRITE, FANTA, LIMCA, MINUTE MAID PULPY ORANGE,MAAZA, and KINLEY.
The new product chosen here by me is named NEROLI- THE ESSENCE OF ORANGE. This is an orange flavored health cum refreshment drink which caters to all the segments of customers. Here the pet bottle is also to be redesigned wherein the bottle will have a small cylindrical outlet which allows limited flow and restricts the spilling of the drink. This bottle also has the facility of finger fixation wherein there is a proper grip on the bottle while drinking, especially by the smaller kids.
Market Structure Analysis:
Cluster Analysis & Perceptual Mapping
Market structure analysis or segmentation seeks to identify and profile subgroups of a given population. POPULUS has conducted numerous segmentation studies for a wide variety of clients involving a wide range of products, services, and institutions. POPULUS has been on the cutting edge in the development of sophisticated techniques for the analysis of market segmentation data and graphic presentation of the analytical results.
Cluster Analysis
Cluster analysis is a set of techniques for separating objects into mutually exclusive groups such that the groups are relatively homogeneous. It is concerned with classification and is part of the field of numerical taxonomy.
A problem faced by many users of cluster analysis is that every cluster analysis always produces clusters, whether there is any underlying structure in the data or not. Given the natural tendency to read meaning into even the most random of patterns, that fact that a solution seems reasonable is no guarantee that the results would be reproducible with a different sample or a different set of variables. Sawtooth Software's Convergent Cluster Analysis (CCA) program addresses this problem by using a k-means method of determining clusters that involves iterating from random but strategically chosen starting points. The analyst specifies the number of clusters to be defined. Each solution proceeds automatically with these steps:
The resulting cluster solutions can be evaluated using common sense judgment as well as measures of reliability and discrimination:
Common sense judgment assesses the face validity of each analytical solution, based upon existing knowledge of the subject category.
Reliability, defined as consistent cluster recovery, can be measured using several methods: split-sample correlations, reproducibility, and stability. By "reproducibility" is meant the percent of the sample re-clustered together in a subsequent solution that has the same number of clusters. Stability takes reproducibility one step further. By "stability" is meant the degree to which cluster members are re-clustered in solutions with different numbers (k-1 or k+1) of clusters. By "discrimination" is meant the extent to which clusters are different from one another. A measure of discrimination can provide evidence of actual cluster structure: between-cluster differentiation relative to within-cluster similarity.
Perceptual Mapping
Perceptual mapping has been used as a strategic management tool for about thirty years. It offers a unique ability to communicate market structure analysisâ€"i.e., the complex relationships among marketplace competitors and the criteria used by buyers in making purchase decisions and recommendations. Its powerful graphic simplicity appeals to senior management and can stimulate discussion and strategic thinking at all levels of all types of organizations.
All mapping techniques attempt to show the comparative differences in how products or services are rated on a given set of attributes. The validity of a map depends on both the overall set of attributes and brands in the study as well as the subset of attributes and brands evaluated by each respondent.
Most studies suffer from too many attributes. Manufacturers and service providers see hundreds of ways in which their products and services differâ€"or might differâ€"from those of their competitors. In most studies it is usually desirable (or necessary) to select a subset of attributes from respondents to rate.
POPULUS employs multiple discriminant analysis of respondent attribute ratings to produce perceptual maps. This analysis finds the optimal weighted combination of all the attributes which would produce the highest F ratio of between-product/service to within-product/service variation. That weighted combination of attributes becomes the first dimension of the map. Then a second weighted combination of attributes is found which has the next highest F ratio, subject to the constraint that this combination be uncorrelated with the first. The lack of correlation permits the plotting of the two dimensions graphically at right angles.
Once the weighted combination of attributes defining each dimension are determined, it is possible to compute the average score of each product or service on each dimension. Those scores are used to plot the positions of the products or services in the representational space. The averages for all products are zero on each attribute and also each dimension. Geometrically, this means that the "center of gravity" of all the product/service points lies at the center of the space. Each attribute is plotted as a vector from the origin to a point which has as its coordinates the correlation of the attribute with the dimensions. This means that an attribute which contributes heavily to a dimension, and is therefore highly correlated with that dimension, appears on the map as an arrow pointing nearly in the same direction as the dimension.
The length of an attribute vector is equal to the square root of the sum of its squared correlations with the dimensions. The relative length of an attribute vector in any two dimensional space is an indication of the extent to which that attribute is "accounted" for by those two dimensions. Products or services with vague, undifferentiated images, or those about which respondents disagree, lie near the center of the space. Those products / services with highest averages on an attribute are farthest from the center of the space in the direction of its vector, and those products / services with lowest averages on an attribute are farthest from the center of the space in the opposite direction.
REVIEW OF LITERATURE ON NPD:-
It's true that ideation sessions for new product development can be stimulating and motivating, especially when the group is on a roll, generating ideas one after the next, and the facilitator is making people feel excited about innovation.
But is this all you want to get from a New Product Development program? SIT has a rigorous set of objectives, and a guaranteed set of deliverables, for our programs - which we expect will lead to actual launches of new products in the market. The Need: Real and Sustainable Innovation
SIT for New Product Development is designed for organizations that want to:
The Problem: Most NPD methods don't lead to real innovation
When developing new products or services, most companies look to three sources:
Although all three are clearly crucial for a company that wishes to serve its customers, relying solely on these sources will not lead to real innovation. Here's why.
New technological breakthroughs can be a powerful source of innovation, but they are usually few and far between, and can involve extremely high costs. Looking to your competition or your customers can generate interesting ideas, but involves a major drawback: the information you get from them is equally available to everyone else in your industry. And while customers can of course be an invaluable source of new ideas - capable perhaps of generating even 90% of a company's new ideas - they don't actually innovate. As Henry Ford said: "If I had asked my customers what they wanted, they would have said 'a faster horse'."
The Solution: SIT for New Product Development
SIT for NPD helps you generate those truly innovative 10% of ideas that others-working on the "faster horse" - just aren't thinking about.
SIT offers a radically different-and highly effective-strategy for NPD. We begin with an analysis of your existing product or situation. Then, we jointly apply the SIT thinking tools to create what we call virtual products. These virtual products may be novel variations on the existing product, or completely new concepts. We test these ideas by passing them through what we call filters - a rigorous set of questions and analyses designed to separate the truly viable ideas from the merely interesting. In the case of NPD, only ideas that the team identifies as having high market potential and a very good chance of implementation pass to the next stage. These ideas are then clustered and prioritized, leading to the creation of an action plan for implementation.
The Results: What You Can Expect
We consider an NPD project successful when new products or services are actually launched in the market. But even before this stage, you will be able to see results, including these three deliverables that you can immediately assess when the project is completed:
MARKETING RESEARCH:-
Marketing research is the systematic gathering, recording, and analysis of data about issues relating to marketing products and services. The term is commonly interchanged with market research; however, expert practitioners may wish to draw a distinction, in that market research is concerned specifically with markets, while marketing research is concerned specifically about marketing processes.
Marketing research is often partitioned into two sets of categorical pairs, either by target market:
Or, alternatively, by methodological approach:
Consumer marketing research is a form of applied sociology that concentrates on understanding the preferences, attitudes, and behaviors of consumers in a market-based economy, and it aims to understand the effects and comparative success of marketing campaigns. The field of consumer marketing research as a statistical science was pioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923.
Thus, marketing research may also be described as the systematic and objective identification, collection, analysis, and dissemination of information for the purpose of assisting management in decision making related to the identification and solution of problems and opportunities in marketing. The goal of marketing research is to identify and assess how changing elements of the marketing mix impacts customer behavior.
Classification of marketing research
Organizations engage in marketing research for two reasons: (1) to identify and (2) solve marketing problems. This distinction serves as a basis for classifying marketing research into problem identification research and problem solving research.
Problem identification research is undertaken to help identify problems which are, perhaps, not apparent on the surface and yet exist or are likely to arise in the future. Examples of problem identification research include market potential, market share, brand or company image, market characteristics, sales analysis, short-range forecasting, long range forecasting, and business trends research. Research of this type provides information about the marketing environment and helps diagnose a problem. For example, The findings of problem solving research are used in making decisions which will solve specific marketing problems.
The Stanford Research Institute, on the other hand, conducts an annual survey of consumers that is used to classify persons into homogeneous groups for segmentation purposes. The National Purchase Diary panel (NPD) maintains the largest diary panel in the United States.
Standardized services are research studies conducted for different client firms but in a standard way. For example, procedures for measuring advertising effectiveness have been standardized so that the results can be compared across studies and evaluative norms can be established. The Starch Readership Survey is the most widely used service for evaluating print advertisements; another well-known service is the Gallup and Robinson Magazine Impact Studies. These services are also sold on a syndicated basis.
Types of marketing research
Marketing research techniques come in many forms, including:
All of these forms of marketing research can be classified as either problem-identification research or as problem-solving research.
There are two main sources of data - primary and secondary. Primary research is conducted from scratch. It is original and collected to solve the problem in hand. Secondary research already exists since it has been collected for other purposes. It is conducted on data published previously and usually by someone else. Secondary research costs far less than primary research, but seldom comes in a form that exactly meets the needs of the researcher.
A similar distinction exists between exploratory research and conclusive research. Exploratory research provides insights into and comprehension of an issue or situation. It should draw definitive conclusions only with extreme caution. Conclusive research draws conclusions: the results of the study can be generalized to the whole population.
Exploratory research is conducted to explore a problem to get some basic idea about the solution at the preliminary stages of research. It may serve as the input to conclusive research. Exploratory research information is collected by focus group interviews, reviewing literature or books, discussing with experts, etc. This is unstructured and qualitative in nature. If a secondary source of data is unable to serve the purpose, a convenience sample of small size can be collected. Conclusive research is conducted to draw some conclusion about the problem. It is essentially, structured and quantitative research, and the output of this research is the input to management information systems (MIS).
Exploratory research is also conducted to simplify the findings of the conclusive or descriptive research, if the findings are very hard to interpret for the marketing managers.
RESEARCH METHODOLOGY INTO MARKET RESEARCH ABOUT NEROLI:-
Methodologically, marketing research uses the following types of research designs:
Based on questioning:
Based on observations:
Researchers often use more than one research design. They may start with secondary research to get background information, then conduct a focus group (qualitative research design) to explore the issues. Finally they might do a full nation-wide survey (quantitative research design) in order to devise specific recommendations for the client.
RESOURCES REQUIRED FOR DEVELOPING THE NEW PRODUCT:-
The major resources required in a new product development are the money and the people (employees) to perform various tasks. Financial resources shall be taken either from the capital income or from the various investment funds. Once adequate amount of funds are allocated, right person shall be employed to do the right work at the right place and time. Idea generation is a stage wherein the idea is being raised from all the employees present in the organization. After all the ideas are pooled in (generated), the best idea is picked and implemented. Here onwards sufficient finance is required in order to implement the idea into a product. This ides is converted into a physically existing product by the people. Neroli being an orange flavored drink requires the fruit orange in larger quantity. This orange will further be processed and made into energy cum refreshment drink. This process requires a lot of hard work and efforts contributed by men as well as machineries which are operated by men.
The product before reaching the market and the target customers has to be tested by the R&D department and shall be market tested. This occurs before the commercializing stage. The R&D department does the concept testing as well as the test marketing, which would then prove that the product is free from any side effect, and health hazards. Therefore R?&D department in any organization plays a major and key role in defining and confining the product limitations.
GENERAL MARKET ANALYSIS FOR THE PRODUCT:-
How To Identify A Target Market And Prepare A Customer Profile
Get your message to the people who need and want what you have to offer! This guide takes you through a step-by-step process that helps you identify specific target markets within your industry and provides you with the know-how to create customer profiles to better channel your marketing efforts.
What You Should Know Before Getting Started
Identifying Your Market
What To Expect
This Business Builder will take you through a step-by-step process that will help you identify specific target markets within your industry and provide you with the know-how to create a customer profile.
What You Should Know Before Getting Started
In order to market your product or service, it is imperative that you tailor your marketing and sales efforts to specifically reach the segment of population that will most likely buy your product or service. It is critical that you first determine or clearly identify your primary market. Your energies and funds then can be spent more efficiently.
If you don't know who your customers are, how will you be able to assess whether you are meeting their needs? Since success depends on your being able to meet customers' needs and desires, you must know who your customers are, what they want, where they live and what they can afford.
We've all heard a business owner say, "My product is terrific! It appeals to everyone." Many of us have also seen small businesses that try to be all things to all people. This is a difficult, if not impossible, bridge to cross.
Targeting your market is simply defining who your primary customer will be. The market should be measurable, sufficiently large and reachable.
Once your target market is defined through your knowledge of product appeals and market analysis, and can be measured, you should determine whether that target market is large enough to sustain your business on an ongoing basis. In addition, your target market needs to be reachable. There must be ways of talking to your target audience.
Types Of Markets
A market is simply any group of actual or potential buyers of a product. There are three major types of markets.
Identifying Your Market
Here are three steps to follow when identifying your market:
Step One Identify Why A Customer Would Want To Buy Your Product/service
The first step in identifying your target market is understanding what your products/services have to offer to a group of people or businesses. To do this, identify your product or service's features and benefits. A feature is a characteristic of a product/service that automatically comes with it.
By knowing what your product/service has to offer and what will make customers buy, you can begin to identify common characteristics of your potential market.
Step Two: Segment Your Overall Market
It is a natural instinct to want to target as many people and groups as possible. However, by doing this your promotional strategy will never talk specifically to any one group, and you will most likely turn many potential customers off. Your promotional budget will be much more cost effective if you promote to one type of customer and speak directly to them. This allows you to create a highly focused campaign that will directly meet the needs and desire Market segmentation is the process of breaking down a larger target market into smaller segments with specific characteristics. Each group requires different promotional strategies and marketing mixes because each group has different wants and needs. Segmentation will help you customize a product/service or other parts of a marketing mix, such as advertising, to reach and meet the specific needs of a narrowly defined customer groups of a specific Larger markets are most typically divided into smaller target market segments on the basis of geographic, demographic, psychographic and behavioristic characteristics:
* Geographic. Potential customers are in a local, state, regional or national marketplace segment. If you are selling a product such as farm equipment, geographic location will remain a major factor in segmenting your target markets since your customers are located in particular rural areas. Or, if you own a retail store, geographic location of the store is one of the most important considerations.
Climate is a commonly used geographic segmentation variable that affects industries such as heating and air conditioning, sporting equipment, lawn equipment and building materials.
Decide if your business is going to do business on a local, regional, national or international level. Identify the geographic region where your market is located. Identify specific boundaries within which you will do business.
* Demographic. Potential customers are identified by criteria such as age, race, religion, gender, income level, family size, occupation, education level and marital status. Choose those characteristics of your demographic target market that relates to the interest, need and ability of the customer to purchase your product or service.
A demographic profile for a business would include such factors as customer size, number of employees, type of products, and annual revenue. If you are a business-to-business marketer for example, you may want to consider segmenting according to your target customer's size. A printing company may decide to target only magazine publishers that publish more than one magazine because they need high volume accounts to make a profit.
Psychographic. Many businesses offer products based on the attitudes, beliefs and emotions of their target market. The desire for status, enhanced appearance and more money are examples of psychographic variables. They are the factors that influence your customers' purchasing decision. A seller of luxury items would appeal to an individual's desire for status symbols.
Business customers, as well as consumers, can be described in psychographic terms. Some companies view themselves as cutting edge or high tech, while others consider themselves socially responsible, stable and strong. Still others see themselves as innovative and creative. These distinctions help in determining how your company is positioned and how you can use the company's position as a marketing tactic.
Behavioristic. Products and services are purchased for a variety of reasons. Business owners must determine what those reasons are, such as: brand, loyalty, cost, how frequently and at what time of year customers in a segment use and consume products. It's important to understand the buying habits and patterns of your customers. Consumers do not rush and buy the first car they see, or the first sofa they sit on.
Most businesses use a combination of the above to segment their markets. Demographic and geographic criteria will usually qualify your target markets so you can establish if segment members have enough money to purchase your offering or if they're in a location that's accessible to the product. Most businesses then use the psychographic and behavioristic factors to construct a promotional campaign that will appeal to the target market.
Step Three: Research Your Market
Demographic, Psychographic And Behavioristic:
The primary vehicles to obtain this information are surveys and focus groups. Surveys are typically anonymous and try to reach as many members of a target market as possible. Focus groups, on the other hand, attempt to get an understanding of a specific market segment by questioning eight to 12 members of that group to discover what psychographic and behavioristic factors might motivate the entire group. You should consider hiring a marketing research firm, since executing both questionnaires and focus groups can be complex undertakings. If hiring a marketing research firm is out of the question for your business at this time, here are some suggestions for conducting your own survey research:
Your current customers can provide you with insight on potential customers and how to appeal to them. You may also discover an opportunity to produce additional products to serve this market or improve on an existing product. Ask yourself: What do I need to learn about my customers? Then construct questions that will provide the answers. It can be as simple as asking a current customer:
Why did you purchase this product? or, How can this product be improved? Make sure you give them enough space to answer.
hoose The Segmented Target Market(s) You Will Sell To [top]
After identifying and defining the possible segments within your target market, you must face the critical question of whether it would be profitable and feasible for you to pursue each identified segment, or choose one or two. To make this decision, you must answer the following questions:
Important Considerations:
For example, if Career Options becomes known for helping college graduates find jobs, unemployed professionals may perceive them as only having the expertise to serve that market.
* After you have mastered one particular segment, you can then begin to develop another. Directing your firm's marketing efforts at more than one market segment by developing a marketing mix for each specific segment is known as multi-segment strategy. An example of a product that was traditionally targeted at women and is now being targeted with variations in strategy at men is hair coloring.
The marketing mixes for multi-segment strategy may vary by product feature, price, promotional material and distribution methods. If product variations requires additional work, you may incur higher production costs. Additionally, different promotional plans and distribution efforts will result in higher marketing costs. Plan carefully, to make sure the costs don't outweigh the benefits.
Target marketing centers around the recognition that a mass market is comprised of separate groups whose demographic and psychographic profiles differ. A program to market to those segments would need to understand and capitalize on the group's differences and use them strategically in marketing.
The largest target market in marketing is one based on gender. Men and women differ in the products they need, what motivates them to purchase, and how advertising needs to be crafted to appeal to them. Men, for example, can be reached with messaging that uses sex, cars, or sports as themes. Women on the other hand, are comparatively more astute as consumers and may require a more rational message for purchasing certain products such as a car but may be swayed if a puppy or baby is used in advertising.
Age, geography, income are all market segmenting criteria based on demographics.
Demographic Market Analysis
The first resource to consult when doing an analysis on a target group is the U.S. Census. The government does a thorough of detailing information about all the groups that make up the U.S. population. The government collects this information every 10 years, and then slices and dices the basic data to generate all sorts of reports related to nearly every aspect of consumer life from births and deaths, to geography, to the size and projected growth of groups such as Blacks, Latinos and Asians.
Depending on the nature of the specific business and the goals of the business for growth, defining one or more target consumer segments is an effective and efficient means of marketing.
Psychographic Market Analysis
Equally important is the psychographic profile of your consumer. What makes him tick? This important information can rarely be found in a book, so large companies conduct primary research to understand the motivations and behaviors of their target market. Both focus group research and quantitative studies are available as vehicles to gain insight into target audiences.
Marketers can also use published data from syndicated research that profile and usage characterizations of some defined consumer groups. This insider information on attitudes and behaviors is used by marketers to their products' advantage.
Marketing Skill
An analysis of demographic and psychographics can help guide decisions in marketing, but will not replace a marketer's skills and experience in determining how best to reach and capitalize on the data the target market analysis provides.
MARKETING STRATEGY FOR THE PRODUCT:-
The marketing concept of building an organization around the profitable satisfaction of customer needs has helped firms to achieve success in high-growth, moderately competitive markets. However, to be successful in markets in which economic growth has leveled and in which there exist many competitors who follow the marketing concept, a well-developed marketing strategy is required. Such a strategy considers a portfolio of products and takes into account the anticipated moves of competitors in the market.
our marketing mix is a combination of marketing tools that are used to satisfy customers and company objectives. Consumers often call the marketing mix "the offering." Your offer is controlled by the following variables often referred to as the four Ps in marketing:
By using variations of these four components you have the ability to reach multiple consumers within your target market.
Creating a successful marketing mix that will increase results often takes experimenting and market research. There are many methods that can be used, both in person and the use of impersonal presentations. The key is to not always depend on "one" mix always explore other avenues. The combining and coordination of these elements will be more effective than depending on one.
You must coordinate all elements so that the prospective consumer is not being sent mixed messages that can cause confusion. Do all of your elements contain the same message? Take for example the following scenario:
We are a company that specializes in marketing services and we cater to physicians, however the products we offer fulfill the needs of lead generation for lawyers. Our price is geared an enterprise budget and our magazine advertisements and promotions are being placed in magazines that have a subscription base of senior citizens.
Do you see a problem with this? While in this scenario it is very obvious, I guarantee that by looking at your marketing mix you may find discrepancies that surprise you. Always make sure that your marketing mix has a message that speaks in unison.
For instance make sure that if you have a practice that caters to a niche market that your product is geared towards the need of that market, your price is within the budget of that market, you are distribution your product or service where it will be seen by that market, and gear your promotion to solve the problems that they are encountering.
If you remember one thing from this article it is that one of the main keys to the success of any marketing program is the ability to work effectively in shaping marketing mixes that meet the nature and needs of your specified target market.
But then, "rural" means different things to different people: from 500,000 people for consumer durables, to less than 50,000 for fast-moving consumer goods.
Still, it is heartening to note the increasing awareness of the importance of rural markets - or, at least, of companies wanting to move beyond urban boundaries.
According to estimates by the Rural Marketing Agencies Association of India, the total budget for rural marketing is only about Rs 500 crore (Rs 5 billion), compared to the over Rs 13,000 crore (Rs 130 billion) allotted to mass media.
This is grossly inadequate to cover the huge potential for different products in rural markets. Of course, clients' reluctance to spend big money for bigger results in rural markets is because there are no standard performance yardsticks for judging the efficacy of the rural marketing efforts.
The TRPs and NRS/IRS data help you determine the efficacy of TV and press marketing. But there is no study to tell you what is the ideal cost per contact or what is the ideal number of eyeballs or footfalls for different rural activities.
But only consider the huge successes of some regional brands, especially in the FMCG sector, which are giving the multinationals a run for their money.
Companies like Cavin Kare (Chik Shampoo, Meera Herbal Powder, Fairever Cream and so on), Anchor (100 per cent vegetarian toothpaste), Ghadi detergent powder and Power soap are proof that regional brands can become brands to reckon with. And don't forget Nirma, the most enduring example of a brand that began as a regional player and is now a giant.
What did these products do that was so different? Most of them identified a segment that was vacant in terms of product and area of operation. They all started in small, concentrated markets, appealing to the local ethos and aspirations of the targeted area.
Their communication, be it a simple radio spot or a wall painting or a theatre film, touched a chord in the target audience. And, most importantly, their policies were flexible and they could adopt to fast changing marketing situations. What should companies do to step up their payback from rural marketing efforts? Here are some steps that should help.
People power
Total commitment from top leadership, keeping in mind that rural marketing is a long-term relationship, is imperative - the successes of Hindustan Lever [ Get Quote ] and ITC are proof of this statement. But even more important is the need for a dedicated task force.
Rural marketing efforts need special mindsets, which many of the urban-oriented management graduates who are at the helm of affairs at most organisations do not possess.
A separate marketing and sales vertical headed by people with passion and commitment to rural marketing and supported by a field team that can face the rough and tough of the vast country-side with courage and conviction is a must.
The best bet is to recruit students from specialised institutes such as the Indian Institute of Rural Management, or at least, management graduates who have studied the subject as an elective.
Many of these are students from small towns, people with fire in their bellies who want to prove themselves in big companies and have no issues about working in smaller markets. Pay them well - remember, you pay peanuts, you get only monkeys - and discuss the path their careers are likely to take in the organisation. And send them out in the field only after thorough training.
Ensure the consistency of the team involved in any project, until the completion of a specific task. Recently, we were involved with two big clients. In both cases, the teams that briefed us in the initial stages and participated enthusiastically in the campaign, were shifted out midway, in keeping with their companies' policy of shifting and promoting people.
The teams that succeeded felt no ownership of the campaigns they had not initiated. What started as a great rural marketing initiative has been relegated to the dustbin... the fate of many rural marketing initiatives in the country.
Goals are good
Early on in the campaign, define your objective: is it a tactical effort to achieve increased sales in specific areas during a specific time, or do you want to build a strong equity for your brand in rural India?
Our experience with FMCG companies is that they are more interested in the first choice. Most of them have previously appointed vendors who implement the company's ideas blindly, be they van campaigns or below-the-line activities.
There is very little effort to tailor whatever communication is made in such efforts, to suit the local audience or fit it with the overall campaign efforts in the mass media.
This invariably leads to less than satisfactory results in terms of awareness of the brands and long-term impact of the efforts in the targeted markets. If you are interested in the second alternative, a comprehensive brand building strategy in rural India, with both short term and long term goals, is a must.
Know your customers
A good place to begin is studying the mindset of your customers, so you can create a customised plan of action. All too often, clients insist their knowledge of their customers (based on studies of urban India) is enough on which to base an action plan. Our experience shows that the attitudes, aspirations and fears of rural customers, with regard to products and brands, is very different from their urban counterparts.
Research can give you invaluable ideas for new product development as well as new methods of reaching your target audience. The refrigerator with standby power for 12 hours, pressure cookers with two handles and a radio with key-winding mechanism are all the result of research.
Ensure availability
Most anecdotes about rural marketing centre on the distribution aspect - the humongous task of physically reaching your product to over 600,000 villages, most of them without motorable roads. But it's not really as nightmarish as it is made out to be, at least keeping in mind the present goals of marketing companies in rural India.
We've all heard about the shampoo sachets that are available in even the smallest villages. How does that happen? It's a direct result of rising aspirations, fuelled by television commercials. The consumer demands the product from the local shopkeeper, who then buys the products from the nearest feeder markets.
Which means if you can ensure distribution to the feeder markets in towns or villages with populations of 10-15,000, you've already taken the first step towards reaching your target customer.
Studies also indicate that rural consumers prefer to shop for durables such as televisions, automobiles and appliances in the nearest big town or city. So, if your products are in towns with populations of 50,000, you're closer to the rural consumer than you would have thought.
NECESSARY RECOMMENDATIONS TO PROMOTE THE NEW PRODUCT:-
As we all know Internet has grown in popularity and has enabled many businesses to sustain in some of the most competitive environments through effective internet marketing.
Internet marketing is an art and a potent weapon if used in the right way. Most of the online businesses are either selling a product or a service. Effective MLM or Internet marketing can drive the required traffic and covert visitors into customers.
There are many ways to sell you products or services online but we will talk about the top 10 ways to promote your products or service online.
The first and the most important thing is formulating a business strategy. Without an effective business strategy, you will be able to run your business but at the end it will die a slow death because there is far too much competition out there.
Another important thing is that in the initial phases, you will be working on a shoe-string budget and this is one factor that needs to be incorporated while formulating the MLM or internet marketing strategies.
You and your business associates are tremendously excited about the promise of your new product.
The question is, how do you get consumers to share your enthusiasm? Promotion is the name of the game when it comes to introducing your new product, idea, or concept to the world.
New product marketing has to involve a full assessment of the product you are about to offer and the product market it is about to enter into. Every little improvement you can make through the new product design process, from functionality to presentation, will bolster the effectiveness of your product launch. You only get one new product launch, so get it right from the start. The following steps are essential in presenting new market products:
Presentation and Packaging. Make an investment in new product design and packaging. Appearance is everything. It is 90% of any sale. The look of your new product has to catch the eye and inspire the mind, even for the most mundane of products. Inspect the general market trends in design, and look at any competing products in particular. How can you make your product appear better than its competitors or otherwise essential to the consumer's lifestyle? Likewise, you should invest in a graphic designer to design your product packaging. For a relatively small investment, a good package can offer self-promotion that can last the product's lifetime.
Commercial Launch. When the new product design process is complete, you are ready to bring your new product to the attention of the industry and the distributors with which it best fits. Seek out commercial and consumer trade shows to get your new product into the eyes and hands of the people most enthusiastic about that industry. Trade shows both small and large, regional and international, are inexpensive product marketing opportunities - particularly essential if your marketing and distribution networks are weak.
Public New Product Launch. Once you have worked out the kinks in your product management and presentation, you can prepare your new product launch for the broader consumer market. Regardless of whether you're aiming for local or global distribution, you have four basic product marketing categories.
Trade Shows
1. For almost every type of product there is an industry trade show. If you have a working product, you can pay a fee and set up a booth at these shows. The booths can be setup cheaply, or you can purchase professional booth materials to put into them. The fee for the show itself can be from a few hundred to a few thousand dollars. Purchasing agents from different stores typically visit the shows looking for new products. Some shows are open to the public but most are only open to industry insiders.
If your product is home made or doesn't fall into an industry category, you can sell your items directly to the public at craft shows and fairs. These kinds of shows can be very cheap to rent space in and will give you an immediate feel for how much interest the public has in your product.
Stores
2. If you have a good product and demonstrable evidence of the interest in your product, such as testimonials or sales figures from personal sales, you can approach local stores to sell your product. Be aware, though, that to get into big stores such as Wal-Mart or Target, you need an advertising or product agency that has experience with the big purchasing companies and managers.
Infomercial
3. If you have invested money and time in developing a new product, consider making an infomercial. There is a significant cost to produce an infomercial as well as a cost for airtime. The production can cost upwards of $30,000 and the airtime can be even more. But infomercials can be a powerful way to get out the word to a national audience on any new product. What you have to decide is whether other ways are better to try first because of the upfront cost that might not be recouped. This method is best when used on product that will have an interest from almost every demographic. Complete market research into the interest in the product prior to seriously considering this option.
A business, more often than not, has a very limited budget when it comes to advertising. The business owner needs to make the public aware of his or her product or service at the lowest possible cost.
There are many ways. A pet breeder in a large city was struggling for several years-until he came up with a novel idea. He started giving away customized "birth certificates" for the pets he sold. Almost immediately, his sales rose more than 10 percent.
The owner of a new home cleaning service was trying to attract clients. She couldn't afford much advertising, so she began offering "home cleaning seminars" to civic groups. After two months of seminars, she was swamped with inquiries and clients.
Promotion often makes the crucial difference between business success and failure. Customers or clients must know about a business or product line before they'll buy and they must have a reason to buy.
GIVEAWAYS. People love to receive "free" items, especially items they can use to gain knowledge or improve their lives. You can base an entire promotional campaign on this desire. If you're running a furniture repair business, for instance, you could give away a furniture repair brochure, free furniture planning guides, or color swatches. Once you begin giving away authoritative information, customers will begin to perceive you as an expert in your field.
NEWS CREATION. Want to get your business in the local newspaper or TV? It may be easier than you think. If you don't have any news to report to the local media, create some. One man hired a team of beautiful girls outfitted in skimpy bikinis and had them waving signs in a busy part of town announcing his new Web site address. Did it get attention by the media? You bet it did!
EVENTS. You may be able to attract the attention of the media or a crowd by staging a special promotional event. If you run
