Creating New Foods. The Product Developer's Guide - The product development project in the company

CREATING NEW FOODS
THE PRODUCT DEVELOPER'S GUIDE

CHAPTER 1
The Product Development project in the company

1.6 STAGE 4: PRODUCT LAUNCH AND EVALUATION

At the end of this stage, top management decides the future direction of the product and its acceptance into the company's product mix.

Management set standards to judge the launch before the launch takes place, and also consider their strategy for reacting to competitors' actions. They plan for the future of the product - will there be further products added to the product line, or a relaunch with improved product and packaging, or a reduction in price related to increasing efficiency of production? The launch is not an end but a beginning and there is a need to plan for the future at the same time as the mechanisms for a successful launch are being started. Management study the product on the basis of future product strategy and therefore future business strategy.

Some of the important pathways of activities, outcomes and decisions in the fourth stage are:

Marketing organisation

Production organisation

Quality, quantity, costs

Distribution organisation

Time, costs, convenience

Launch sales analysis

Product, production study

For marketing, the next steps are to train the sales staff and to persuade the retailer to accept the product.

The decision of the retailers to accept or reject is based on product attributes such as strong growth in the product category, a new product or a me-too product, acceptable product quality and high expected profit contribution, but they are also influenced by strong promotion and advertising, competition, adequate funds for the retailer's promotion and discounts.

The retailer is very often a supermarket chain and they may have product specifications which have to be met (and should have been recognised much earlier in the project). They may also charge for shelf space and have a pre-determined price range.

For production, the plant is built or organised, the production personnel trained, quality assurance programme put in place and production begun. The stocks of the product are built up in stores and finally distributed to the retailers.

For marketing, the final step is to ensure the distribution of the product, its placement on the retailers' shelves with any in-store promotion and then the release of the advertising. All is then ready to commence on the product launching date - the advertising is placed in the media and the product is put on the shelves in the supermarket or the store. The only step remaining is for the consumer to buy the product so that the retailer will keep on ordering it. The sales personnel, particularly the merchandisers, have to ensure that the shelves are kept stocked, the displays are attractive and the retailers' problems with the products are solved.

In the evaluation after the launch, the sales of the product are monitored, and the product's performance checked in production, distribution, storage and the supermarket. The retailers' attitudes to the product and their placement and promotion of the product in the supermarket are studied - as well as, of course, the consumers' attitudes and behaviour towards the product. On the production side, the yield of the product and the quality of the product are monitored, but also important are the raw material quality and quantity, the equipment functioning and the labour content. This monitoring usually leads to product improvement, production and quality assurance improvement, and cost trimming, and often to changes in distribution and in marketing methods. The time after launching is a time of constant improvement of product and process, of reduction in production costs and of increase in the effectiveness of the marketing methods.

After the launch, there is an assessment by senior management of the financial returns and the effect this product is having on the business strategy. Decisions are taken at set times to either pull the product from the market or adopt it into the product mix.