New Product Development Stage - Essay Example

Market Introduction Stage: This stage involves the following process:-1. Explain how marketing objectives and marketing-mix strategy, and costs, and other company factors affect pricing decisions. 2. List and discuss factors outside the company that affects pricing decisions. 3. Explain how price setting depends on consumer perceptions of price and on the price-demand relationship. 4. Compare the four general pricing approaches and describe the major strategies for pricing new products. 5. Explain how companies find a set of prices that maximizes the profits from the total product mix. 6. Explain how companies adjust their prices to take into account different types of customers and situations.

(Pricing Considerations and approaches. 2007). During this stage, it becomes crucial to give an appropriate focus on price and promotion concepts. The company can choose between a float or skim pricing strategy. Apart from this, it is necessary to give emphasis to the promotional methods, especially advertising of the product, for the purpose of creating awareness about the new product in the market and among the consumers. There exist chances of competition. Sometimes the company may incur some loss during this stage.

The cost will be higher due to the sales promotional activities and the quantum of sales will be normal or at a lower level. The important fact during this stage is to analyze whether the customers will be ready to accept the technology of the five-blade surface or not. Growth Stage: The growth stage is the third stage in the product lifecycle. At this stage, the Gillette Fusion razor gets widely accepted in the market. Increased popularity accelerates the further movement of the product in the market.

"Customer awareness will increase and competition will begin to enter the emerging market and offer equally good or even better and innovative products." (Altaf 2007). This stage features an increase in sales volume. More advertisement should be done during this stage, in order to capture more and more market. The company must improve the quality of the packaging and that of the product as there are more chances for the market to be reduced by way of competition. The maturity stage of this stage of the product will be marked by a stable market for the product.

The general public would already have been aware of the product and as a result, not much advertisement and publicity would be required at this stage. The company can also go in for a reduction of the price at this stage as sales volume would have increased manifold. The company should focus on reducing the price of fusion razors in comparison to its major competitors. The reduction in price will be compensated by more profits from the stable market. At this stage also Gillette should focus on making fewer modifications to the product.

The company can also think of giving its other product free of cost for further promotion. For example, it can give a small shaving gel tube with two packets of Gillette Fusion Razor.