SENECA COLLEGE, TORONTO
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As Taught by Tim Richardson School of Marketing and e-Business, Faculty of Business
DETAILED OUTLINE©
SECTION on new product development
and competitor intelligence
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Jan
23

New Product
Development
Process
New Product Development

Five steps in the New Product Development Process, 
1. Idea Generation - thinking about it 
2. Screening - getting opinions 
3. Idea Evaluation - estimate costs, revnue, profit, do market research 
4. Development of Product - physically design and manufacture the product 
5. Commercialization - mfg. large number of product, distribute in the stores
 

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Jan
23
Chapter 8
New Product
Development
and the Net
New Product Development
- physical products
- cyber products


Internet Time
Two important apsects, says Prof. Ward Hanson

First - it refers to the rapid change and evolution of

  • internet tools, 
  • markeplace (the customers) 
  • business practices
Second - it is also the acceleration of 
  • new product development, 
  • competitve activity 
  • and business tactics that are made possible by the internet
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Jan
23
Chapter 8
New Product
Development
and the Net
Standards and Conventions (text p. 236)

Standards are specific limitations or physical features within which developers have to fit

Conventions are general practices based on past history and common assumptions and expectations

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Jan
23
Customization
 
 
 
 
 
 
 
 
 
 
 

Customization
 
 
 
 
 
 
 
 
 

 

Customization

In Turban's book, which we used in IEC 702, there is reference to New Product Development in Chpt 1, page 28

"Electronic Commerce allows for new products to be created and/or existing products to be customized in innovative ways. Such changes may redefine organizations' missions and the manner in which they operate."

Building customer profiles, with advanced techniques, allows for mass customization which will help increase cross-selling, up-selling and CLV
 
Consultant Bruce Judson 
wrote a book in 1999 titled
"Hyper Wars: 11 Strategies for Survival and Profit in the Era of Online Business"

In Judson's book (Page 126-127) he discusses Customization

Judson explains that Product Customization is possible because of a convergence of two elements:

  • the Web as a one2one communications technology
  • manufacturing processes that allow for the development and delivery of custom products
The are a large number of examples of this customization taking place now. They can be divided into several categories
  • Services  which are delivered online, allowing people to scroll, or click a menu of features in a downloadable product
  • Services which are described online through a menu, but delivered offline (travel, insurance, financial, entertainment)
  • Products which are described online through a menu, but delivered offline (certain toys and games, computer hardware components and desktops, some clothing, specialized sports equipment
Judson provides several examples of companies that are doing customization on their web site in order to increase their competitiveness

Call Bay - let's women design and buy their own swim suits online
Chip Shot Golf - sales doubled when the company started custom-club ordering
Standard & Poor's - the huge financial company diversified into other financial products and offered financial planning advice based on answers to an online questionnaire
Acumin Corp. - estabished a web sit to allow visitors to create personally tailored vitamins

Continuing to develop this capability will be, says Judson, a combination of

  • manufacturers creating products that permit ever increasing customization
  • further advances in computing power at decreasing costs
    • since computing power needed when you are featuring graphic rich content
  • new software that is continuously enhacning the options available to businesses to personalize
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Jan
23

Customization
 
 
 
 
 
 

Customization

 www.chipshot.com
 www.standardpoor.com
 www.leefit.com
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Jan
23

Customization
 
 
 
 
 
 
 
 
 
 
 

Customization


www.abcnews.go.com/sections/business/TheStreet/customization_000616.html
By Catherine Valenti

"Many retailers are trying to stand apart from the competition by selling customized products and offering personalized services on the Web, and thereís no end to the quirky ideas that companies are using to give customers that personalized touch.  Even though the cost of making customized goods often surpasses mass-producing items, companies say the customer loyalty they earn is worth it."

Some products lend themselves well to customization online.
Cosmetics is a good example.

"One example of e-tailers moving to customization is  Reflect.com, a customized beauty site formed last September by Procter & Gamble and Institutional Venture  Partners. The firm makes everything from lipstick to moisturizer based on a personís profile. Clients fill out an online questionnaire that asks them everything from skin type to hair color. Then they get to peruse a variety of products specially formulated for them."
 

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. Competitor 
Intelligence

Chapter 4
Larry Chase jokingly titles this chapter http://007
subtitle is "Spying on Your Competitors and Yourself"

beginning on p. 92,  List of things you should look for on a competitor's web site

  • look and feel of the graphics
  • attempts to collect user information
    • offering of free product or services for supplying profil information
    • use of cookies
  • password protected areas for "special customers" goes towards upselling
  • process of buying (if e-commerce)
    • use of shopping baskets
  • credit cards accepted
    • level of credit card security processes
  • navigation, can you find what you want
    • search engine within the site
  • does the layout reflect banner ads they us on other sites
  • what reciprocity do they have with other advertisers in banners and pop-ups
  • who are they associated with
    • who links to them
    • who do they link to
  • how well do they market the site
    • can you find the page by using the URL in major search engines
    • do they use special words in their META tags that might be helpful for you to copy
  • how sophisticated is the source code HTML, flash, XML etc.
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. Competitor 
Intelligence
Competitor Intelligence
  • a determining factor in beating competiton in getting new products to the commercialization stage
  • also important in determining what your competition has future plans for, so you can scoop them
  • not just for big companies, but also medium and small sized companies


the basic principles of competitor monitoring - very very good reading
 http://dialspace.dial.pipex.com/aware/competitor-analysis.shtml

who is a competitor
 http://dialspace.dial.pipex.com/aware/competitor-analysis.shtml#Who

Business competitors are:

  • Other organisations offering the same product or service now. 
  • Other organisations offering similar products or services now. 
  • Organisations that could offer the same or similar products or services in the future. 
  • Organisations that could remove the need for a product or service. 
the difference between information and intelligence
 http://dialspace.dial.pipex.com/aware/competitor-analysis.shtml#Convert

"... the relevance and importance of each piece of information needs to be interpreted
and analysed - on its own and in conjunction with other information, the other pieces in the jigsaw. This is where information starts to become intelligence."

some web sites devoted to CI
 http://www.lookoutpoint.com/look/

 

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. Competitor 
Intelligence

Historical
Perspective

Sun Tzu - Chinese military strategist
544-496 BC

"If you know yourself, but not your enemy, for every battle won, you will suffer a loss."

Chinese military strategist, Sun Tzu "the Art of War"

A number of quoteable quotes are used by Sun Tzu in business all over the world.

For example, to justify early entry to the market, one web site says
"Those who arrive early at the battlefield will be in a position  to take the initiative."

http://www.ozemail.com.au/~priordan/gorinosh.html
Miyamoto Musashi - Japanese warrior philosopher

"To attain the Way of strategy as a warrior you must study fully other martial arts"

from Go Rin No Sho - Book of Five Rings by Japanese swordsman/philospher Miyamoto Musashi a very popular book on wall street in the early 1990's

 
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. Competitor 
Intelligence

Strategy
Planning

Historical
Perspective

Machiavelli (1469-1527) -- Italian political and military theorist
 http://www.sas.upenn.edu/~pgrose/mach/
good essay on Machiavelli
 http://rowlf.cc.wwu.edu:8080/~n9610899/machiavelli.html

on this site is the table of contents, and entire text of each Chapter in Machiavelli's book "The Prince"
 www.sas.upenn.edu/~pgrose/mach/index1.htm#tab

"He tried to gain the favor of the Medici [the family that ruled Florence, Italy in the late 1400's - early 1500's] by writing a book of what he thought were the Medici's goals and dedicating it to them. And so The Prince was written for that purpose. Unfortunately, the Medici didn't agree with what the book said, so he was out of a job. But when the public saw the book, they were outraged. The people wondered how cruel a man could be to think evil thoughts like the ones in The Prince, and this would come back to haunt him when he was alive and dead."
 www.ctbw.com/lubman.htm 

 

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Canadian Government sources on Economic Espionage and Competitor Intelligence http://www.csis-scrs.gc.ca/eng/comment/com32e.html

A series of papers on security threats and risk which can effect Canadian commercial activity and the knowledge of which can facilitate developing tactics, strategies and plans
http://www.csis-scrs.gc.ca/eng/comment/comsum_e.html