During commercialisation, the knowledge required to formulate these plans
has to be found, organised and integrated. It starts with information
from the product design and process development: product and packaging
qualities, product concept, target market, price range, market channel,
physical distribution, process flow sheet, process conditions, product
testing.
At this point, final adjustments are made to the product so that
it is acceptable not only to the consumers but also to the company’s
operational divisions, the retailers and other people in the distribution
system.
With industrial products, it has to be acceptable across the
different groups in the buying company - product development, quality
assurance, production and buying.
The product and its inner and outer
packages need to be tested through production and distribution to determine
if the packaging provides the necessary protection to the product and
also meets the expected demands of distribution, sale and use. Some
of the product prepared during the small plant tests can be tested
in large
consumer/customer 'use' tests. In industrial marketing, it is important
not only that the new ingredient is acceptable in the manufacturer's
plant but also that the manufacturer's product is acceptable to the
consumers. In consumer marketing, there are further consumer ‘use’ tests
and sometimes a small test market in a few supermarkets representative
of the overall market to test the effects of different prices and promotions.
There is constant comparison with competitive products on the market
to confirm that the product has advantages to the users.
After these studies, there is enough information to detail the market
for the product and to draw up a complete market plan for launching the
product, including market trials, methods of selling, promotion and advertising,
and methods of distribution.
The production development differs if the present plant is to be used,
or if a new plant is to be built, or if new equipment is to be bought
or built. A preliminary process equipment design can be made or, if
current plant
is to be
used, the layout and adaptation of this equipment for the new process
determined.
The production is ‘fine-tuned’ and quality assurance developed.
Costs and prices are studied, the investments needed for marketing
and production are estimated and a financial analysis is made. Then
the decision
is taken to stop, or to test the market and production plans, or to
allow the product to go forward to launching. The production and the
marketing
are integrated first in large-scale production and market testing,
and then in an operational plan. A final commercial report, based on
the information
collected, analyses whether the product fits in with the commercial
and financial aims of top management.
The steps and some of the activities in commercialisation are shown in
Figure 6.2.
Figure 6.2 Activities in product commercialisation
FINAL
PRODUCT PROTOTYPE
PRODUCT AND PROCESS SPECIFICATIONS
MARKETING STRATEGY FINANCIAL
ANALYSIS
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Knowledge of the product, production and marketing |
| |
Product
Product qualities optimised
Final packaging design
Final product concept |
|
Marketing
Target market finalised
Preliminary market/sales prediction
Price, promotion, place studies |
|
Production
Plant design
Plant commissioning
HACCP analysis
Process control
Yields and costs studies
Quality assurance designed, tested
Transport/storage testing |
| |
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|
Planning
marketing, production and finance
|
Preparation of:
Market strategy
Market plan
Market forecast
|
Preparation of:
Production specifications
Production plan
Physical distribution plan |
Preparation of:
Final costing and
pricing
Investment finance plan
Operational finance plan |
|
|
MARKETING,
PRODUCTION AND FINANCE PLANS
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| |
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Integration
of marketing, production and finance
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Prepare marketing material
Test market |
Production on large-scale
Variability of production |
Study of cash flows
Finance sources, costs |
Analyse marketing and production testing |
Analyse financial feasibility |
| Improve marketing |
|
Improve production |
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Improve costs |
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OPERATIONAL
PLAN
DETERMINATION OF RETURN ON INVESTMENT
COMMERCIAL REPORT
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Think
Break 6.1
Outcomes from product commercialisation: marketing plan objectives
Compare the marketing plan objectives in launching the following new products:
 high
protein bread by a group of small bakers with their own retail shops
a tomato flavoured potato puffed snack by a potato chip company with national distribution
a
line of salami products by an Italian meat processor into supermarkets in Britain
|
 KNOWLEDGE
REQUIRED FOR THE MARKETING PLAN
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