5.14: New Product Development - Need
New Product Development (NPD) is a critical activity for businesses aiming to maintain competitiveness and foster growth. The factors driving the need for NPD are:
- Market Competition: Increasing global competition necessitates continuous innovation. Companies must develop new products to differentiate themselves, capture market share, and stay ahead of competitors.
- Customer Needs & Expectations: As customer preferences evolve, companies must create new products to meet these changing needs and expectations. It includes adapting to external environmental trends.
- Technological Advancements: Rapid technological progress opens up opportunities for new product development. By leveraging new technologies, companies can create innovative products that provide them with a competitive edge.
- Shortening Product Life Cycles: Products have shorter life cycles due to fast-changing consumer trends and technological advancements. As a result, continuous NPD becomes necessary to replace obsolete products.
- Strategic Objectives: Companies may engage in NPD to achieve strategic objectives, such as entering new markets, targeting new customer segments, or enhancing brand image.
- Business Success and Growth: New products contribute significantly to a company's growth and success. They generate revenue, improve market position, and enhance the brand's reputation.
