1. Product Development

2. Ansoff’s Matrix – Planning for Growth
This well known marketing tool was first published in the Harvard Business Review (1957) in an article called 'Strategies for Diversification'.
It is used by marketers who have objectives for growth.
Ansoff's matrix offers strategic choices to achieve the objectives.
There are four main strategies for selection.
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3. Ansoff's Product/Market Matrix

4. Market Penetration
Here we market our existing products to our existing customers.
This means increasing our revenue by, for example, promoting the product, repositioning the brand, and so on.
The product is not altered and we do not seek any new customers.

5. Here we market our existing product range in a new market.
Not just for kids!
Market Development
Here we market our existing product range in a new market.
This means that the product remains the same, but it is marketed to a new audience.
Ex. Exporting the product to another country
marketing it in a new region
Expanding or defining a new TM
Expanded to countries all over the world

6. This is a new product to be marketed to our existing customers.
Product Development
This is a new product to be marketed to our existing customers.
we develop and innovate new products to replace existing ones.
Such products are then marketed to our existing customers.
Example: auto makers, where existing models are updated or replaced, and then marketed to existing customers.

7. Diversification
This is where we market completely new products to new customers.
There are two types of diversification:
Related Diversification:
we remain in a market or industry with which we are familiar. (i.e. same type of good)
Unrelated Diversification:
we have no previous industry or market experience. (i.e. different type of good)

8. Diversification Examples
Developed a men’s line of yoga and activewear
Started w/ food items, expanded to paper products, housewares and even banking!
Manufacturer of cigarettes, bought Kraft Foods in 1988

9. Case Study Colorado Ricardo Mountain Bikes
In groups of 3, read the case and determine specific strategies that Ricardo can use to increase sales of his mountain bikes.

10. Stages of Product Development
Idea Generation
Idea Screening
Concept Development
Market Strategy – Feasibility Study – Product Design
Test Marketing
Market Entry

11. The Stages of Product Development
1. Idea Generation
what NEW product would consumers WANT or how can we make an EXISTING product BETTER
2. Idea Screening
Not all ideas, at first, are good ones
3. Concept Development
Create a prototype = sample of product
4. Market Strategy
Figuring out who the TM is (demo, geo, psychographics, to put together a marketing plan to implement the strategy)

12. The Stages of Product Development
5. Feasibility Study
Can we advertise, promote, distribute, transport, store, package, make, sell…this product? Will people buy it? Will we make money from it?
6. Product Design
What does our TM like? Colour, features, material, traditional, trendy
7. Test Marketing
Give your product to your TM to ‘test’ out
TM can fill out a survey to give you feedback
8. Market Entry
Your product/service enters the product life cycle (PLC) (introduction stage)