Assessment of New Product Development and Management in Nigeria: A Study of Unilever Nigeria Plc

Assessment of New Product Development and Management in Nigeria: A Study of Unilever Nigeria Plc

Chapter One

OBJECTIVES OF THE STUDY

To determine the relationship between marketing research and new product development
To determine how new product development influences customer satisfaction and retention.
To determine the impact of technology, skilled manpower on new product development.
To identify critical factors, both marketing” and otherwise; that for new product success or failure in the market place.
To identify the impact of new product development on profitability of an organization.

CHAPTER TWO

REVIEW OF RELATED LITERATURE

INTRODUCTION

Flow of this chapter is on the effort that has been made by other scholars towards solving the problem relating to new product development and management. This chapter therefore, specifically reviews related issues such as what is new about new product; new product development; product and service management; sources of new product; product classification; market research and new product development; scope of marketing research; research institute and product development; new product planning; stages in new product development processes, product lifecycle; introduction stage strategies; consumer adoption process; management and funding of new product development; sources of finance for new product; why new product fail; costs of failure of new product; corrective measure against new product failure.

WHAT IS “NEW” ABOUT NEW Product?

Onah and Thomas (2004:78) established that “In modern marketing concept, when we talk about new products, we do not mean that the product must be “brand” new, but that there is a change in the make-up of a product”. They enumerated the factors to be taken into consideration or circumstances under which a product could be regarded as new, as follows:

There are changes in cost or price of the product
There are new conveniences in the use of the product
There exist new performance level discovered
When the benefits of the product can easily be articulated
When a new method of use is developed
When a new market is developed for a product, etc.

Accordingly to Booz, Allen and Hamilton, there are six categories of new product in terms of their newness to the company and to the market place, viz:

(a) New to the world products – that is those products that create entirely new market

(b) New Products Lines – that is those products that allow a company to enter an established market for the first time

(d) Improvement or revision to existing products – that those products that provide improved performance or perceived greater value and thus replace the existing products

(e) Repositioning – that is existing products that are targeted to new market or market segment

(f) Cost Reduction – that is those products that provide similar performance but at a lower cost

WHAT IS A NEW PRODUCT DEVELOPMENT?

New Product development is a business and engineering term, which describes the complete process of bringing a new product to the market.

In other words, Product development is the process of designing, creating, and marketing an idea or product. The product can either be one that is new to the marketplace or one that is new to your particular company, or an existing product that has been improved. In many instances, a product will be labeled new and improved when substantial changes have been made.

For instance, Sterling Bank Plc introduced two financial products in the month of June 2006, called ‘Sterling Plus” and “Sterling Acquire”. Sterling Plus is a savings account that, besides yielding good interest also provides added features of a current account such as cheque book and ATM card. Sterling Acquire enables a new family acquire household properties like generator, Cookers, T.V., Car, etc. The IBTC Yield Account, from the desk of IBTC CHARTERED PLC is another new product introduced to the market in the month of July 2006. Again, Zenith Bank Plc was the first to introduce the Automatic Teller Machine system which allow their customer take cash any time, print statements, arrange transfer through a debit card. Lastly, the new 2007 Outlander, Eclipse Spyder Convertible, New 2007 Ralliant Sport Sedan are all new products (Motor Vehicles) from the desk of Mitsubishi Motors, to mention but few.

There are two parallel aspects to this process: one involves product engineering; the other, marketing analysis. Marketers see new product development as the first stage in Product Life Cycle management.

Also, Product development can be said to be a process of designing, creating, marketing an idea or product. The product can either be one that is new to the marketplace or one that is new to your, particular company, or an existing product that has been improved. In many instances, a product will be labeled new and improved when substantial changes have been made. For instance, we can still remember products like the “new improved elephant blue detergent”, the lunching of the “Delta soap”, etc

CHAPTER THREE

RESEARCH METHODOLOGY

INTRODUCTION

This chapter deals with the method that will be used to gather data for the purpose of this research, The chapter will describes the research design, sources of data and population of the study. Other issues it will examine are sampling techniques, reliability and validity of the instrument and the statistical tools of data analysis.

RESAERCH DESIGN

Research design means the structuring of investigation aimed at identifying variable and their relationship to one another. Methodology follows the steps of scientific enquiry which includes: identification of problems; problems definition and delimitation; analysis of the problem, deductions and implementation of the recommended solutions

For the purpose of this study, descriptive survey design was used for the study . the method is considered adequate and most appropriate because it help the researcher to describe, examine, record, and interpret the variables that exist in this study.

SOURCES OF DATA

The data to be used for this research work were to obtained specifically from two sources namely: primary and secondary sources.

(a) Primary Data

These are facts collected by the researcher himself specifically for the research project through sources such as questionnaires, interviews, Observation, telephone, etc. In this study, questionnaires along with personal interviews and telephone calls would be used to get information from the respondents. Although this source seems slow in gathering

(b) Secondary Data

Unlike the Primary data, Secondary data are statistical facts or materials first collected by other people to be re-used by the researcher. In other words, these are published or second-hand information such as census, text books, articles, journals, internet sites, workshop/seminar papers etc that was collected earlier for purpose other than the current study.

CHAPTER FOUR

PRESENTATION AND ANALYSIS OF DATA

This chapter deals with the report and analysis of data obtained from the research questionnaire, this analysis is solely based on the responses from the questionnaire which are relevant to the objective of the study. This chapter will also test the formulated hypotheses with the relevant sections of the questions and to find out whether such proposal will be accepted or rejected.

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

INTRODUCTION

This chapter provides an overview of salient findings emanating from the search the results are aligned with the various objectives and hypotheses set out in chapter one of the project. Conclusion were drawn and necessary recommendations were made from the research findings.

SUMMARY OF MAJOR FINDINGS

The result based on the descriptive statistics reveals the following

It was found from this study that there is a strong positive correlation between marketing research and success of new product development.
A properly development new product improves customers satisfaction as well as high customer retention.
The study further revealed that technology and manpower have positive impact on new product development which places company ahead of other competitors in the market.
The results of the analysis revealed that critical factors such as capital timing and market analysis determine the success of failure of new product development
Also the result revealed that there is positive relationship between new product development and profitability of an organization.

CONCLUSION

This research has attempted to assess new product development and management in Nigeria, Based on the findings of this work, firms, organization and government have been expose on how to manage new product and harvest the benefits attached it.

The research indicated that the required intensity of market research, technology, manpower will go along to achieve high profitability to firms that embark on new product development.

RECOMMENDATIONS

Following the result of the data collected and analyzed, this research work stands in a firm position to make the following crucial recommendations to its readers that:

Given that New Product development and management is an antidote for organizational survival in a competitive market-structured economy such as ours, notwithstanding market leadership status already attained (as revealed from our findings), it is hereby recommended that Nigerian companies should invest in market research for new product development to facilitate development of high quality products which would, apart from satisfying the wants of the consumers and win their loyalty, also help to employ our local resources, such as machinery, row materials and labour, thus steering towards economic and industrial growth and development. It need to be noted that the place of market research in new product development cannot be overemphasized.
A strong manpower base and an up-to-date technology are inevitable for a successful new product development. Our findings noted that as technology changes, so also do products need to change so as to meet customers demand and enables the organization keeps abreast with the changing needs of the people in order to capture a larger market share for itself. To this extent, management should ensure that those saddled with the responsibilities of developing new product possess the requisite knowledge, experience and skills required. In addition, a high level of technology and skilled manpower, which will aid in developing new products according to the specifications or needs of the consumers, are also required in the organization in order to be able to meet the changing needs of the market
Management should give its total support to new product development project especially in the area of capital and financing. There should be efficient and timely appropriation of fund through out the product development process and also at the various stages of the product life cycle where different marketing strategies should be adopted. The extent to which management is involved in new product development determines the extent to which the project would be a success. Besides, management has a great task in adopting strategies that will enhance its success and there must be discipline on the part of the development team, this is very crucial.
To avoid the risk of failure, new product development exercise should not be done haphazardly, but properly planned. Before the organization’s scarce resources are committed into the project, only new product, which market research/test marketing had shown to be potentially viable and in high demand, should be launched or commercialized. Besides, such information as consumers’ preference, packaging, labeling, competitive activities, pricing and promotion needs for the new product should be gathered and analyzed. This should be followed with efficient marketing and promotional strategies with effective and functional sales force management.
The pricing for the new product should not be too high or too low. If a new product’s price is too high, above its competitors in the market, it may cause the consumers to abandon the product. This may spell a doom for the company, unless of course, the new product is positioned for the higher class having unique advantages over others, by using ‘skimming the scream’ market strategy. On the other hand, if the new product is priced too low, the company may be deprived of an acceptable profit, at least, in the short run, except the price is used as a penetration strategy to enable the company first capture a good share of the market, especially where the product is aimed towards the mass market.
New Product ideas must be properly evaluated against its expected returns in terms of profitability, market share, Returns On Investment, Volumes of sales, Earning Per Share, etc.

Finally, Unilever and Nigerian companies at large should adopt the concept of new product development which implies that the dominant firm, market leader, market follower or competitor refuses to be content with the status quo; that it wants to continue to outperform itself and the industry by being the source of new product ideas and customers services which are only achieved by exercising initiative, setting the pace and capitalizing on competitors’ weaknesses in order to achieve a strategic positioning in the market and thus mobilizing its resources to full capacity, which will finally result to growth and development both to the organizations and the national economy. In addition, a continuous new product development that would result in quality product to keep the company going and well established in the minds of the consumers as well as ensuring a long term profitability and good returns to the shareholders are highly recommended to organizations.

SUGGESTIONS FOR FURTHER STUDIES

Research work is never conclusive. There are areas this thesis would have loved to touch but was constrained. The following areas are therefore recommended for further studies by other researchers on the subject matter:

The effect of government policies on new product development
The amount of input required for the different stages of new product development, the effect and cost of control experiment as research instrument on new product development.
What should be the contribution of the lower cadre of staff in the area of new product development
Other external factors that might undermine new product development
Management style or any other element that would facilitate success of new product development.

Although this work is not conclusive, it is hoped that the study will help in educating others on the importance of new product development to the sustenance and survival of a business organization. It will no doubt also add to knowledge and expand our views on the subject matter.

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