Objectives of Product Development
Product development is a continuous and dynamic process. In reality it is an unending process of the manufacturing system. There are two main objects of every product development programme, namely
- immediate objective and
- ultimate objective.
Immediate objective of a product development programme is the work for the immediate satisfaction of consumers’ wants, utilization of available resources viz., material, labour and equipment, sales generation and to explore for further improvement in the produce design and its utility.
Ultimate objectives are of permanent nature and implies generation of consumers’ confidence in the product on a long term basis so as to capture the market. This can ultimately pave way for economies of large scale production resulting in price reduction to benefit the consumers.
Elements of Product Development
The main elements of product developments are as follows:
1. To discover the feasibility of the production of product.
2. To develop qualities and characteristics of products.
3. To develop different models and designs of products.
4. To select the best model or design.
5. To decide about packing, colour, size, form, etc., of the product.
6. Expansion and contraction of product mix.
7. Discontinuation of unprofitable product.
8. Improvement in products.
Advantages of Product Development
Product development has become an important function of every enterprise. It provides several advantages to the enterprise. Some important advantages of product development are as follows:
1. Product development helps in producing the goods and services of best quality.
2. It provides maximum possible satisfaction to the consumers.
3. It helps in expanding the market for the products.
4. It helps in achieving stability in the demand of the products.
5. It minimizes the possibilities of obsolescence of products.
6. It helps in facing competition successfully and effectively.
7. It increases the goodwill of the organization.
8. It increases profit earning possibilities of the organization.
Scope of Product Planning and Product Development
The scope of product planning and product development is very wide. It includes following activities:
1. Product Decision
The decision to start the production of a product is included in the process of product planning and development. Every producer decides before commencing the production whether it would be profitable for him or not to start the production of the product under consideration.
2. Size and Design of Product
The decision of size and design of the product is also a part of the process of product planning and development. The size of a product may be small, medium or large. Design of the product includes the determination of form, structure and colour, etc.,
3. Name of Product
Product planning and development includes the determination of appropriate name of the product. Name of the product must be simple, brief, easy to pronounce and remember.
4. Price of Product
Determination of price of the product is also included in product planning and development. Price determination is perhaps the most sensitive decision to be taken by an enterprise. The success or failure of all the marketing efforts depends upon its price determination. The price must be determined keeping in view the price of the products of competitors, purchasing power of consumer, demand and popularity of the product etc.
5. Brand, Packing and Label of Product
Every enterprise has to determine a particular brand, a particular type of packing and a distinct label for its products so that its products may create a distinct place for themselves in the market and gain loyalty of the consumers.
6. New uses of Product
Development of new uses of product is also included in product planning and development. Development of new uses of a product pertains to discovering the purposes for which the product can be used. Discovery of these new uses of a product helps in increasing the demand of the product.
7. Guarantee and after-sale service
Business and industry extend guarantee for the repair and maintenance of products for a certain period. During the warranty period, free services are provided to the consumers, if they have a problem with the product they purchased.