The introduction of new products to the market is always a critical moment for any company. This is because of the uncertainty that surrounds the reaction of customers to the new product. The fact that companies spend huge sums of money to carry out product development adds more significance to the attention paid to customer reaction to new products. What is the best way to increase the chances to positive customer reaction to new products? The most ideal way is to ensure that in the process of either developing new products or making innovations on old products so as to give them a new look is to ensure that customers have a say in the process of coming up with the new product (Ritter & Walter 2003 pp. 482 – 487). This has to be done in a way that makes customer participation not only possible but also convenient. The logic is that if customers give their opinion while the development process is ongoing, these opinions will be taken into account and the end product will reflect the needs of the customers (Johnsen & Ford 2007,pp.300-306). Thus, the market will be getting items which are in line with customer expectations.
Managing Customer Participation in the Development of new Products
Getting customers to participate in the process of developing new products is not as easy as it may sound. It is a complicated process that requires careful calculations. The factors that need to be considered as this undertaking is being planned include:
The number of customers to participate
It is reasonable that a representative sample of customers be involved in the development of the new product. This means that the number of the customers must make statistical sense. It is not ideal to use the opinion of two customers to model a product for the market. The numbers should also be small enough so as to avoid a huge financial burden on the company.
The market segments represented by the customers
The market is made up of a number of fragments. A successful product development strategy must ensure that all these samples are engaged if the product is meant for the whole market. But his need not be the case if the product is for a particular segment. For example in coming up with a new type of meal, it is reasonable that young people, middle aged as well as the old are involved. This is because food is a fairly balanced commodity that cut across the market fragments. But if it is a commodity that is meant for a particular fragment such as sanitary towels, it makes business sense to deal with women and girls.
Time of engagement
Time is a crucial factor in the sense that the customers who are to be engaged should be brought on board early in the process. The reason for this is that bringing them late when the product is almost done may lead to wastage if they disapprove substantial sections of the product, meaning that these sections have to be discarded in favor of the new proposals. This is avoidable in that their views are catered for right from the beginning of the process.
Involving customers in the development of new products is not an easy undertaking as far as financial implications are concerned (Kim & Wilemon 2002, pp.1-18). The main focus of nay firm is therefore to ensure that the cost of carrying out the entire exercise does not go beyond what the firm or organization can afford. How can this be done? The areas covered above such as focusing on the target market only, picking a reasonable number of customers and bringing the customers on board at the right time will go a long way in ensuring that resources are spent in areas that must be dealt with. Thus waste is avoided and the exercise will end up being less costly.
Managing Customer Involvement
There are several ways in which participation by customers can be managed. Some firms carry out direct engagement whereby the day to day officials of the company perform the customer search role. In this case these officials reach out to customers and get them to the process. The marketing and the sale departments liaise with the other wings of the company so as to streamline the operations (Lagrosen 2005, pp.424-429).The other way is the outsourcing of the customer recruitment portion to a company that deals exclusively with this activity. This way, the company will only give specifications to the other company and wait for the customers to be availed. The company that will be bringing in the customers can also handle the feedback which will then be given to the company managers.
Examples of companies that have used and failed to use Customer Involvement in New Product development
The Apple Products
The products that Apple has availed to the market over the last few years have not been developed without consumer or customer input. As much as customer ideas may have been taken into account at different stages of the development process, the bottom line is that they have been consulted anyway. This accounts for the positive reception that Apple products such as the iPad have experienced in the market. Other electronic companies have also made use of this system of getting the responses of customers on the suitability of their products before releasing them to the market.
Mattel Toys Saga
Mattel is a giant toy producing company that had one of the heaviest toy recalls in the industry. This is because defective toys were manufactured and released to the market only for the toys to be discovered to be unfit later (Gale Reference Team 2007, pp.1-2). The toys were found to be harmful to the children who were making use of them. How did this happen costly mistake come to pass? The input of customers was not made use while the toys were being processed. This is how the company ended up producing toys that were unsuitable for use by children. Had customer opinions been sought before the toys were produced, adjustments would have been made and this wasteful recall avoided.
Customer participation in the development of new goods for the market is vital. This is also true for any innovation done by business organizations. The participation has to be handled in a careful way so as to make it both cost effective and production –friendly. As exampled by Apple and Mattel, encouragement of customer participation is beneficial while leaving customers’ opinions out is costly. Important factors to look into while managing customer input include the number of customers, the fragment of the market concerned with the product and the time when the customer input is supposed to be made use of.
Gale Reference Team., 2007. Toy recall has parents concerned, frustrated.(Business)(Mattel apologizes for China manufacturer’s serious mistake’ in using lead paint): An article from: The Register-Guard. New York: Thomson Gale.
Johnsen, T & Ford, D., 2007. Customer Approaches to Product Development with Suppliers. Industrial Marketing Management, (36)3, pp. 300-308.
Kim, J. and Wilemon, D., 2002, Sources and assessment of complexity in NPD projects. R&D Management, 33 (1), pp. 16-30.
Lagrosen, S., 2005. Customer involvement in new product development: A relationship marketing perspective. European Journal of Innovation Management, (8)4, pp.424 – 436.
Ritter,T & Walter,A., 2003. Relationship-Specific Antecedents of Customer Involvement in New Product Development. International Journal of Technology Management (26) 5/6, pp. 482 – 501.