Essay on New Product Development: Filling Market Gaps & Addressing Scarcity

Introduction

A new product is the definition of a good or service that is being offered by a party, which has unique characteristics that are absent from the market. That is because of the new attributes that the good or service has. The motive of new product development is the existence of a market gap that can be filled. Furthermore, there are the eases of scarcity, where there is a shortage of a given commodity, which the product will end up filling when offered. Scarcity is the primary idea for the existence of market gaps (Cialdini, 1987). That is because of the shortage, which causes the scarcity, is the principal motive for the organization trying to fulfill the need by offering a new product. The other factor that leads to the development of a new product is a change in the state of technology. With technology, there is the existence of the ability of the existing operators to have their ideas brought to life. That is because technology creates a great deal of convenience as a result of the convenience that it enhances. Therefore, based on various ideas that have been mentioned above, multiple parties get a plan for the development of a new commodity.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

New Product

The primary reason for the development of a new product is the existence of a market gap that has to be filled. The market gap is created because of various reasons. For example, there might be a shift in the preference of customer needs, a change in consumption trends, or even a pandemic. In this case, the basis for the business idea is a combination of various factors. The significant factors contributing to the development of the new service that is to be delivered in this case are technology and a pandemic. There has been extensive research that has been undertaken in the logistics field. That has the effect of incorporating modern technology in the delivery of commodities to buyers. In that case, the technology that this service will leverage is drone technology. That is whereby customers will have their products delivered with the help of drones. That will have various advantages for both the customers and the business. The new service will be the delivery of customer purchases through the use of drones. That is whereby the customers will have their locations specified; then, the drones will deliver commodities to them.

Creation process

The creation process, in the case of this new model of service delivery, will be the satisfaction of consumer needs. That will be through bridging the gap that exists between the source of the goods, and the customers. The creation will be based on the customer needs that have not been met by the existing operators (Trott, 2008). That is fast delivery, as most of the current services involve delivery personnel. Furthermore, there is a pandemic currently, which is spread through human contact. In this case, there will be the elimination of social interactions in service delivery. That is because the drones will replace the delivery personnel that was being used earlier in the delivery of commodities. In the creation of the service, there will be a wireless network enabled by GPRS, which will map out the location of the various consumers in the locality. On that basis, the customers will have their deliveries made to the coordinates that are specified as their specified locations. The business will keep a small volume of inventory, which is in the form of fast-moving goods that are demanded more by customers. In addition to the catalog, there will be a plan with other business operators where their inventory will be used to satisfy the customer needs. That is if the stock that the business has is unable to meet the needs of the customers currently. That will be the basis for the creative process, which specifies the significant parties involved in service delivery.

Product development

The product development is the definition of how the business will create utility. That is whereby the firm will plan the various operating activities to give its customers a great experience. In this case, it is a delivery service, which will be using drones to deliver commodities to its customers. The product development will be a series of activities that will lead to offering a service that will be viable in many dimensions. First, there will be a SWOT analysis, which will analyze the environment. On the basis of the results, the business will commit the various resources it has and uses its strengths; while minimizing the weaknesses. Through its operation, there will be opportunities that will be embraced, while the weaknesses will be worked on. That will be in the form of screening the idea to aid in having a great product in place. The other product development undertaking will be testing the concept. That will be in the form of having trials to gauge the success of the service delivery undertaking. That will work towards enhancing the convenience in the basic operations.

The other major undertaking in product development will be the technicalities that the entire drone delivery service will use. That is because the business is based on the use of technology to satisfy the needs of the customers. There will be a test of the efficiency of the drones locating the customers and delivering their orders without fail. Moreover, there will be testing of the infrastructure on which it is built. That is because there will be an application that will be the nerve center of the information system upon which the operations of the service will be based. Furthermore, the technicalities involve authorization of the service operations by the relevant authorities. Commercialization is the other perspective of product development, whereby consumers are invited to use the service to satisfy their needs. A great marketing strategy initiates that. There will be persuasion of customers to sue the delivery service; based on the satisfaction, it will guarantee them. The influence will be critical in marketing, which will enable the customers to realize what the business will allow them to benefit (Cialdini et al., 1993). The various aspects of product development can be periodically reviewed to address the changes that might be affecting the operations of the service over time.

Funding

Funding is one of the most critical aspects that the success of a business relies on. That is because it determines the type of activities that the company can implement and hat is out of its scope of operations. Therefore, there must be the choice of an option that will have the best effect on the business' goals. In this case, there will be a variety of funding avenues for the company. The primary source of funding will be from loan capital. That is whereby there will be loans that will be sought from the various financial institutions that are available. Commercial banks will be the first source of loan capital. Based on the business plan and objectives, the commercial banks will be in a position to advance loans to the business. That will be used for laying down the foundation of the various business operations. Self-funding is the other source of funding for the business. That is majorly through the savings that the proprietor has for the business. That will be the capital layout that the company will use to start its operations.

The other source of funding for the business will be through the sale of shares to people that will be interested. That will be through the sale of units of ownership to various parties, who will be part of the ownership of the firm. The sale will be made through an initial public offering, where subscribers will be invited to purchase the shares so that they have a share of the ownership, and advantages of the new business. Lastly, there will be the option of family, friends, and other investors that would like to inject their capital into the investment. That will form the layout of the business' funding.

Manufacture and distribution

The operating activities of this business will not involve the manufacture of commodities. That is because the role that will be played by the business is that of an intermediary. It will be through the delivery of products to the consumers in the specified location. That will be the utility that the business will be creating. Distribution of commodities will be the operating activity that the company will specialize in. That is through the use of the drones that will be owned and operated by the organization. However, when expertise is needed, the organization might hire specialists for better service delivery and reliability. The other option will be through outsourcing some functions that can be best addressed by other parties that are outside the organization. There are some circumstances where outsourcing proves to be better than hiring permanent workers in the organization. Delivery of orders will be automated, where the customers place orders either through phone calls or a dedicated mobile phone application. Furthermore, there will be a website that will have a section for order placements. That will be the distribution framework that the business will operate on. In the distribution, commitment, and consistency of the organization will form its competitive advantage (Cialdini, 1985). That is because it will satisfy the needs of the customers better, leading to loyalty to the organization.

Conclusion

A new product or service development is based on the availability of a market gap that needs to be filled. In this case, the market gap is the delivery of commodities with speed, convenience, and minimal human interaction. That is based on the global coronavirus pandemic and the available technology. That has the effect of creating an environment that the business can use to enhance a high level of success through the delivery of commodities to the various customers that are available within a given locality. Through market analysis and scheduling of operations, there is a high chance that the business will succeed. That is based on the SWOT analysis and the design of processes based on its results.

References

Cialdini, R. B., & Cialdini, R. B. (1993). Influence: The psychology of persuasion. https://www.semanticscholar.org/paper/Influence%3A-The-Psychology-of-Persuasion-Cialdini/ed1ff7d3f3d670f4a3bdd9a5e78cb862bc8795f0

Cialdini, R. B. (1987). Influence (Vol. 3). Port Harcourt: A. Michel. https://www.oreilly.com/library/view/influence/9780061899874/text/9780061899874_Chapter_7.xhtml

Cialdini, R. B. (1985). Commitment and Consistency: Hobgoblins of the Mind" from Influence: Science and Practice. Glenview, ILL: Scott-Foresman, 51-95. http://elibrary.bsu.az/books_400/N_232.pdf

Trott, P. (2008). Innovation management and new product development. Pearson education. https://www.researchgate.net/publication/247685440_Innovation_Management_and_New_Product_Development_By_Paul_Trott