Expanding your product/service line? You may want to consider these issues thoroughly before embarking on NPD:
Speed of market growth? Which stage of growth is it at? A decelerating market may mean that your product will have a smaller segment by the time it is out.
What are the Porter’s 5 forces in this market? Check your competitors and find out what are the likelihood of entrants. The product offering has to be substantial in value for substitutes to pale comparison, so that consumers will be willing to pay the differential value to obtain your product.
How are customers responding to currently existing products of like nature? Are they already having too much of the same thing in the market that the utility value of seeing a new one released is diminished?
How can you improve the product based on consumer needs/wants? Eliminate / Enhance / Reduce / Add features where appropriate.
How much will it cost incrementally to do so? How will it affect the cost structure vis-a-vis the competition? What cost complexities involved and wow much more complex will this be? This will dramatically eat into profit margins if not managed properly. Provide a buffer for unforeseen circumstances.
What level of imitability is the new development? Can the idea be “stolen” or spun off easily without a lawsuit ensuing?
What are the resources and capabilities available to make this happen effectively?
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