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Research for New Product Development Process Sample


Evolving advancements in the field of science and technology have changed individuals’ lifestyles and expectations from producers. With advancement, now consumers are looking for different options in regard to their need. As well, with advancements they are also looking for improved and high quality products and services that are antithetical and need less space for storage and also provide value for money (Armstrong et al., 2009). With increasing expectation of consumers, the companies are also forced to concentrate on innovation by introducing new products from time-to-time as per the needs of their customers (Annacchino, 2003).

New product development refers to a process of developing a new product for the customers. It is a unique process in which companies create innovative products with an aim of their commercialization (Loch & Kavadias, 2007). It start with idea generation and ends at commercialization. Here, in this paper, a study of new product development process is undertaken in regard to a concept of developing a small car in UK for the benefit of customers who usually drive over two wheelers and are not able to afford a car.

Industry Background and Justification of New Product Development

With increasing competition, in the UK automotive industry most of the companies operating in this industry are trying to identify new ways to innovate and attain growth. In present, the UK automotive industry is significantly known for its premium and sports car.  In 2008, the industry manufacturing sector turnover was £52.5 billion. As well, around 180,000 people were directly employed in this sector. The UK is a key centre for engine manufacturing and in the year 2008, approximately 3.16 million engines were produced all over the country (Holweg, Davies & Podpolny, 2009).

The success of the UK automotive industry is all due to transformation done in the last decade from a sector with disruptive labour relations and a poor standing for quality and productivity to the one that is all-inclusively competitive. Use of advanced technology and latest management practices have transformed industry’s shop floor environment and product technology includes all advanced materials and processes. With continuous improvement now industry has transformed into a competitive one that in turn is presenting difficulties for industry players to operate and maintain their position in the long-run (Nieuwenhuis & Wells, 2003).

Product Concept & Justification

With an analysis of industry and the growth strategies pertinent in present, it becomes clear that the industry is quite effective in regard to premium car segment, but still it is not doing well for budget segment as several customers are still not able to afford car with high prices. There are several families that drive on two wheelers with their kids that are not safe for them in all type of weather (Holweg, Davies & Podpolny, 2009). So, if they could be served with a small and budget car in their budget could be quite suitable for them. With surveys, it is also found that today customers want to switch from two wheelers to four wheelers, but they can’t afford it.

In this kind of environment, it would be significant for companies to make use of this concept and commercialize it in reality. With a concept of small car, it is possible that the industry players would become able to build the world’s cheapest car with all essential features. The industry growth rate is significant in regard to premium cars, but it is not so good in case of budget cars so, it is essential to concentrate more on this segment of the industry and attain related advantages.

The industry regulations and weaknesses (relative labour costs, accessibility of competent labour and environmental regulation) also poses several challenges’ in front of industry players that in turn encourage them to make use of several new concepts like introduction of small and budget cars for customers.

New Product Development Process

For the success of any organization, it is crucial for to improve and update its product lines. If, an organization gets fail in regard to change, it could result in a decline in its sales (Annacchino, 2003). In this concern, the process of NPD is quite crucial for an organization as in this the concept of a product goes through the different stages of its lifecycle and eventually replaces existing one. A new product is the one that opens an entirely new market or a product that adopts or replaces an exist product (Pitta & Pitta, 2012).

In other words, it refers to a product that substantially broadens the market concerning an existing product. New product can be helpful for a firm to increase/defend its market shares by offering extra choice or updating older ones (Brethauer, 2002). Today, making use of new product development has become essential for creating stars and cash cows for the future, to take benefit of new technology, to keep a pace with rivals, increase market share, maintain competitive advantage etc (Littler, 2006).

Idea Generation

In regard to the development of a new product, the first stage is of idea generation on which, ideas for a new product could be obtained from customers (applying user innovation), employees, the company's R&D department, trade shows, focus groups, corporate stags, competitors, salespeople, or through a policy of Open Innovation (Kerin, Hartley & Rudelius, 2010). If, an idea is in my mind like of developing a new car, at this stage it could be observed more by taking ideas of different people involved. It would help in collecting all basic ideas about a small and budget car.

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Concept Testing

At this stage, some consumers will be presented with a proposed product so that their attitudes and intention at this early stage of development could be measured. Here, the company representatives will talk with customers so that the basic idea behind customers’ desire for a four wheeler could be identified (Brethauer, 2002). By discussions with customers, it become easy to identify that most of the lower-income group people want to buy a four wheeler as their safe transport needs to drive with family that is not possible on two wheeler. With the test of concept, it becomes clear that the small budget car needed is required as a safe transport medium. With this, it would now become easy to develop the product by developing its marketing strategy.

Market Strategy Development

The new car would cost 1492.77495445 British Pound on road and would be built on a unique platform instead of traditional ones. It would meet all safety and regulatory conditions. It needs to build on a speedy scale. Its design would be in a way that it can be easily exported in other countries (Karniel & Reich, 2011). The car would be a flare for the UK automobile industry and would target lower-income group people. It would be positioned with the help of following marketing mix strategy:

  • A four wheeler with comfortable seating for four persons.
  • Fuel efficient engine
  • Mono volume design
  • With all current safety and emission requirements Price:
  • Car with affordable price
  • Care with features exceeding customer expectations at a given price point.
  • It would be marketed with the help of levers like channel partners, penetration, and logistics.
  • Orders could be placed on internet at company website.
  • Through approaching, information, and educating the target customer group through different sales promotion methods.
  • Use of different media channels to advertise.

Business Analysis

Subsequent to the market strategy development, it is essential to check new product’s financial viability. As the car proposed is quite cheap and also need to be developed with innovative design, it is possible that the costs would be higher for it, but if appropriate approach is adopted towards its design and technology it would be feasible to generate profits (Brooke & Mills, 2002). The design should be in a way that includes all essential components and safety measures with minimum use of costly materials. It could be done effective with the use of Value Engineering concepts.  
With a totally different value proposition in comparison to the available one, it is possible to change the Prototype about a new product and attain significant returns.

The guiding factors in this regard are this that the tax structure, on materials and production, must affirm the planned cost so that a viable product can be developed (Steil, Victor & Nelson, 2002). Sales of small cars is also expected to increase with recession and lower budgets so, it would be a better to start with the production of 0.5 million cars every year. The plants would be set with a capacity of 0.5 million cars per annum.

Product Development:

Finally, the new product would be developed with following features:

  • Engine capacity 725 c.c. twin cylinder
  • 4 speed manual gear box
  • Low capacity, lighter, adequate with effective Power Rear Engine  
  • Effective mileage and aluminium engine
  • Superb control over discharge and smooth acceleration
  • Comfortable leg room
  • Dimension L: 3.5m, w: 1.7 m, H: 1.9m

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With the help of above discussion, it becomes clear that the success of a new product development depends on its effective planning and execution. With the help of all steps discussed above, it is easy for a firm to give shape to a new product and take it towards commercialization.


  • Annacchino, M.A. (2003) New Product Development: From Initial Idea to Product Management. Netherlands: Elsevier.  
  • Armstrong, G. et al. (2009) Marketing: An Introduction. 9th ed. India: Pearson Education.
  • Brethauer, D.M. (2002) New Product Development and Delivery: Ensuring Successful Products through Integrated Process Management. USA: AMACOM Div American Mgmt Assn.  
  • Brooke, M.Z. & Mills, W.R. (2002) New Product Development: Successful Innovation in the Marketplace. UK: Routledge.
  • Holweg, M., Davies, P. & Podpolny, D. (2009) The Competitive Status of the UK Automotive Industry
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