The Process of Launching the New Product by Unilever Company - Example

New Product Development Table of Contents 1.0 Introduction 2 2.0 Company overview 2 3.0 New product development 3 4.0 Rationale for the new product development 4 4.1 Product idea 5 4.1.1 Idea generation 5 4.1.2 Idea screening 6 4.2 Concept development 7 4.3 Product development 7 5.0 Target market and value proposition 8 5.1 Target market 8 5.2 Market segmentation 9 5.3 Customer benefits 10 6.0 Commercialization 12 6.1 Product launch 12 6.2 Pricing 13 6.3 Distribution strategy 13 6.4 Communication strategy 13 7.0 Managing product growth 14 8.0 Conclusion 15 References 16 1.0 Introduction The purpose of this plan is to provide a detailed schedule of activities that will be committed in the process of launching the new product by Unilever Company. The plan will tackle various aspects including the company overview, the product concept, and the rationale behind the development of the product, the target market and value proposition and the process of commercializing the product as well as process of managing the product growth. The ultimate objective of doing this is to ensure that a detailed plan for launching the new product which is ‘Axe’ for Unilever is developed. 2.0 Company overview Unilever Company has been in operation for over a century now since it was first founded in the 1980s in the United Kingdom by two families from the Netherlands namely Jurgens and Van Den Bergh. Since then, Unilever has grown to become a globally recognized brand. Unilever is currently associated with over 400 brands and which are provided in different product ranges including food, ice creams, variety of soaps and luxurious shampoos as well as well as other family care products (Unilever 2012). The company is known for producing world’s most respected brands which include Lipton, Dove, Hellmann’s and Omo as well as Axe for men alongside other trusted global brand names like Blue Band and Purreit as well as Suave. Unilever is also very well because of its mission which pays very substantial attention to social wellbeing. For instance in 2010, the company launched what it termed the Unilever Sustainable Plan that could him attain his goals and targets while minimizing the negative impact it causes to the society (Unilever 2012). In general, Unilever can be labeled as one of those view companies that have chose to better the operating environment for sustained business growth. Given its long-term attention to innovation, Unilever, has been in the forefront in developing new brands that have certain nutritional properties that are aimed at improving the health standards of the users and providing superior taste, fragrance and functionality for the customer. It is with this respect that Axe for men was developed in 2010 which is a spray and grooming brand for men. Following the development of this product and heat that it has caused in the market, the new Axe for ladies is being developed and this is where this plan is expected to show hoe Axe for women will be launched in the market (Unilever 2012). 3.0 New product development The product to be launched is called Axe for men. This is a product from ladies and it’s a development from the commonly Axe for women which has real hit the market and has shown some potential for growth if it could be diversified so that it can also be used by women. The idea for this product is that apart from Axe being developed for men and that as shown that it is a good spray and grooming product for men, it is the turn for women also to enjoy the same. Like the case of men Exe for women is an idea that has come up to help women have the average young lady heroic feeling and also to be able to be ‘boy magnets’. With the addition of a new spray, it is believed that this product will add greatly to the body of sprays for the company. The concept of the product is also to help women like their counterparts men to have a unique scent. Exe is therefore a spray that will be developed and launched by the company in order to make women understand that in no way they are left out in the company quest to develop different products for different customer segments (Baker and Hart 2007). The purpose of developing this product is to help women give their bodies a scent that is natural and that can be compared with that of men. The product will exist as a spray and therefore will help women be as attractive as well. 4.0 Rationale for the new product development Developing and placing a new product into the market can be a very scary and tricky endeavor. This is because the product has to be tested and established if it can be viable in the market. Further the demand may not be established and also the cost of developing and managing the product. It is with this regard that this document is aimed at coming up with an elaborate product launching plan. This part of the product launch plan is particularly aimed at showing how the whole idea for developing and launching the ‘Exe’ for women by looking at specific areas of the concept which include idea, concept and product. In general, the New Product Development (NPD) can be presented in several steps depending on the nature and the value of the product and can be upto eight steps as shown in the diagram 1 below. According to (Baker and Hart 2007), the steps include idea generation, idea screening, concept development and testing, marketing strategy and development, commercialization of the product, test marketing, product development and business analysis. However, NPD process can be summarized in three main steps namely the idea, the concept and the product development. In New Product Development (NPD) as shown in the diagram, the idea can be categorized into two major groups namely Idea generation and idea screening. The idea generation is described as per the source from which the product idea comes from. This is because atleast there must be a source for the idea. In organizations, ideas can be sourced in different ways. Some of the sources that an idea can be generated from include market research, employees, consultants, competitors, customers and distributors and suppliers. In the case of Unilever, the idea for Exe spray for women has been as a result of market research and customers as well as distributors and suppliers (Goffin, 2002). 4.1 Product idea 4.1.1 Idea generation In the process of generating the idea, the information that was received through a market survey where men who used Exe product and their fiancés were involved was very instrumental for this idea. Information gathered showed that the like the case of men, ladies could also prefer to have Exe spray that could actually add on their beauty and scent while in public. This is because close relatives, friends and even fiancés could tell how the Exe spray had changed the fragrance of their men. In other words, the idea was founded on the information collected from the field on how the customer utilizes various products (Baker and Hart 2007). On the other hand, the customer queries on the availability of Exe spray for men are the cause for developing this idea. According to Goffin (2002), customers can provide important information on developing a certain product. This is because they are the end users and they know what they like and what they dislike. Finally, the key players in the supply chain and in particular the distributors also played a very significant role in the generation of this idea. This is because the distributors and in the case of Unilever company being the retail stores received orders for Exe spray for women after assuming that since Exe Spray for men was available, definitely Exe spray for women was also available (Unilever 2012). This was a motivational factor and a good foundation for this product. 4.1.2 Idea screening Idea screening according to Von (2002) entails the process of going through various ideas and coming up with just one and that is considered most feasible and viable for the business. However, in the case of Unilever, idea screening was not very necessary as already the product had been identified and that almost a similar product which is Exe for men was already available. Actually, the earlier product’s performance gave positive indications on how the new product will perform at the market after Exe spray for men had shown very positive results. This idea was therefore considered to be very viable for the business. 4.2 Concept development After the idea about Exe spray for women had been generated and screened, concept development was a very important step for developing this product. Despite the fact that many organizations may have ideas which they consider feasible, there is still need to take the same idea to the target audience. In the case of Unilever Company and development of Exe spray for women, the idea actually generated from the customers and was presented back to potential customers who are women in order to establish their view as well preference for the product (Von 2002). This was especially important in determining the level of demand for the product. The purpose of presenting the idea to the target audience is also aimed at establishing whether the product is actually practical and feasible. This is because as the company aims to serve the customer needs, it is also important to establish whether product will actually benefit the organization. In trying to understand how this idea was to be received in the market, the process was juts done as a concept study and not as a prototype (Von 2002). The findings from the target audience showed that if some small modifications can be made to the Exe spray for men, then this idea will be great for the company as many potential customers and in particular showed that they were interested to have their own spray which is almost similar to the one being used by men. 4.3 Product development Having established the appropriateness of the concept, the process of developing the product that can deliver on the promises founded on this product is very important as it will seek to deliver on the insight of the product through performance. Ensuring that the product lives upto its promises is very important since it helps in building the business proposition (Von 2002). In developing the product, ability to fulfill the concept, cannibalizing the estimates and other volumetrics greatly helped in concluding that this product was to be successful. In the market for example, the customers are eager to have a similar Exe spray with that of men even though small differentiations. This is because many of the customers were already contented with the scent in the spray and were willing to pay for the product as long as it’s made available (Baker 2002). 5.0 Target market and value proposition 5.1 Target market The product will be targeted at women aged 15 years and above who are looking for beauty and attractiveness. This target market is especially preferred based on the findings from their men counterparts who in the same age bracket have managed to create a very significant market for this brand. With this in mind therefore, it is expected that the majority of women will replicate the same trend from their men. As a matter of fact, it is expected that women will use men as point of reference (Baker 2002). On the other hand, the women in this age, most of them are considered to be mature and are very cautious of how they look and are very keen to improve on their smell and feeling if not making themselves look more attractive than before. This target market, also comprise individuals who are working and have some money to spend beauty cosmetics and are ready to give whatever they have in exchange for their outlook. With this product, it is expected that the target market will be able to make the spray their favorite and will stop at any point to have the spray of Axe. This is because, this target market is ready to make product their anarchy and take it as one of their most preferred choices. From there research and surveys, it has been established that majority of the females have been requesting for and wanting to have their own Axe with their own scent. 5.2 Market segmentation Market segmentation entails identifying various portions of the market into different groups which distinct from the rest. The importance of doing market segmentation is to help the organization better map the needs of various market segments and try to satisfy them. In the case of this product, the target market which is women aged 15 years and above has been segmented into three groups based on their ages. This is because each age group has got its own preferences and tastes (Baker 2002). This was done deliberately to facilitate the process of positioning business in the market by adequately supplying the customer with the most suitable product with the right quality and price. On the other hand, product positioning entails what the business is able to create in the mind of customer that influences his thinking about the product. In the case of Axe spray, quality, safety, price and usage are some of the positioning strategies that could be employed by the company. Segmentation table Positioning strategy Market segment (women) ages (15 and above years) 15-25 26-35 36 and above Quality Quality will be of great significance in this target market Like the case of ages 15 and 25, quality will be preference as many of the customers will be able to compare the scent in Exe with those of other brands from other companies. This market segment is also very sensitive to quality and most of the members in this segment will be looking for nice scent and if possible the sweetest than the one for Exe spray for men. This is the only way they will remain attracted to the product. Price Price will be charged above the standard prices in the market but equivalent to that of men Price will be slightly above the prevailing market prices to signify the quality of the product Prices will be charged above the standard prices Value Safety, nice smell and reduction of bad oduor Safety, nice smell and reduction of bad oduor Safety, nice smell and reduction of bad oduor Attributes Class, luxury and comfort Class, luxury, comfort and fashion Class, luxury, comfort and fashion Product categories Packed in different sizes so as it to make it more affordable for those who are not working and depending on their parents support Relatively large sizes and in different colors Relatively large sizes and different colors Usage occasions The product could be used in different occasions and more especially in public places. The scent will not be offensive but attractive to the users and the neighbors Use for all social occasions Use in different social occasions Users Paying personalized attention by including booklets on how to apply the spray and the likely effect to the user Providing prior information about the product and trying to guide on the spray should be applied Providing prior information about the product and trying to guide on the spray should be applied 5.3 Customer benefits The motive behind the customer spending on a particular product is the benefits that will be accrued (Eisenhardt and Graebner 2007). With the development of the Axe spray for men, as the stands to benefit, the customer is also expected to make some gains. The sole agenda behind the development of the product is to have it used as a spray and a grooming brand for women as is like the case of men. The customer will benefit from high quality spray at a much affordable price (Baker 2002). This will put the women on the map with regard to kind products they use as compared to men. The customers will also have humble time to neutralize that effect caused by men’s Exe spray and will always feel at easy when they try to come into contact with men in public places. In the market it is estimated that over 5,000 body sprays do exist and are manufactured by various companies and all of which perform different functions. While there are those sprays that can be used for relaxing, there are those that are used for relief, relaxing and pain relief. In the industry of manufacturing cosmetic and sprays, where the Exe spray falls, there exist about 800 companies which are recognized globally and among them are Ergogenic Nutrition, LLC, Cedem AG, Alissi Bronte, Aroma perfumes, Louis Oliver and SVN Fraglance. All these companies and many more do manufacture and market wide range of cosmetic products including sprays Export (Bureau 2012). However, in the market there is no single spray that is grooming that can be applied by each gender and act as a ‘girl or male magnet’ except Axe spray for men which is a product was lunched in 2010 purposely to give a heroic feeling. This is what has contributed major for the developing and managing this new product. As mentioned earlier, most of the products that are produced for the market, all of them except a view tend to serve similar purpose and even though there are those that are gender-oriented, still, customized sprays especially those have unique and very distinct feature that can be an attracting factor for the other gender are yet to be developed. What will make this product different and unique from the rest of the sprays in the market, is the addition of a unique scent that will make the product marketable for men and women. Further, the product is different in that it will be designed in such away to give the customer a cool and adventurers spray that will put one a head in the game of dating. This is because the product will designed in away to improve on the look, smell and feel always at best (Jenkins 2002). The reason why the ladies are demanding for this product is because, they are convinced that with the development and the launching of the Axe spray for men and because of its design which helps them improve on their look and smell as well as feeling and which assists them to remain at the top of the dating game. It is with this regard that the identified market segment has been requesting to have their own brand of Axe so as to be at pace with men. 6.0 Commercialization 6.1 Product launch Axe for women will be launched first in major cities where the majority of the identified market segment live and where the majority are requesting for the product. Launching any new product no doubt requires some substantial resources and time. First the product will be launched by placing it through the company distribution channel where Axe for men goes through. From there, the product will be launched in the company website, magazines and business media so as to increase its publicity and create awareness in the market on the existence of the new product (Easterby-Smith et al 2008). Involving the in-house team in launching the product is the most important thing as it will help develop clear and smooth path for the product movement (Leonard and Rayport 1997). Since the customers will be so moved with the product can do, taking clear photos and placing them in brochures and flyers will help greatly instill confidence about the product among the target market. 6.2 Pricing Since the quality of the product is paramount in this case, the pricing of the product will be done in such away to reflect product standards. This is to mean that even though the product will be charged above the industry prices, it will still remain at same price level with the current Axe for men. This is so important in ensuring that the price does not discriminate between genders (Eisenhardt and Graebner 2007). 6.3 Distribution strategy The product distribution will follow the already established distribution channel in the company retail stores. This is to imply that the product will be sold through the established company channels. The product could also be distributed through retail markets like supermarkets, hypermarkets and cosmetic shops which not necessarily have to belong to the company. This is particularly important in improving the product coverage (Leonard and Rayport 1997). 6.4 Communication strategy The objective of doing product communication is to create publicity for the product in order to help the market know that the product does exist and where it can be found (Eisenhardt and Graebner 2007). Different avenues for the product communication are available and among those that will be included in communicating about Axe for are the company website, using existing customers and in particular men who use Axe, company magazines, brochures and flyers, media both print and electronic and use of the social media like Facebook so as to deliver the message about the product to the wider market as possible. 7.0 Managing product growth Managing the new product in the market during growth is important given that it is at this point that competition stiffens and tends to affect its performance. It is therefore a good idea in making sure that the product is well managed and that its demand stimulated as much as possible from the onset. The performance of the product can be determined from its generating into the business as percentage of total sales and the cost incurred in producing the product (Crawford and Benedetto 2007). The Axe spray for women, is expected to generate revenue from women who have the desire to have a new look, smell and feel that will give them equal status with men when it comes to matters related to dating. The demand by this group is where the product is expected to generate its revenues from (Eisenhardt and Graebner 2007). The market growth for Axe for women is expected to continue showing positive results given the fact that young women and men are becoming much aware of the look, smell and feelings and how they affect their relationships. Among the young and growing generation, dating is a hot topic and each person is interested at becoming a winner at the end of it in the relationship (Crawford and Benedetto 2007). Now, given what the product can do for the customer in terms of look, smell and feel, it is expected that the product will continue over years like as is the case of men. However, long-term sustainability is depended on level of competition and how many companies are about to introduce similar product. It is very easy to produce this product at a low cost. This is because the company already has expertise in the product line from those who work on Axe for men. Further, by using the already established supply chain already established by the company, the cost of distribution is to be reduced significantly. Finally, in order to help make sure that the product has profit margins for the company, the product instead of being produced at one point and distributed globally, it can be manufactured and distributed from specific regions so as to reducing shipping, distribution and other related costs like taxes (Crawford and Benedetto 2007). 8.0 Conclusion This plan has tackled a number of aspects in relation to New Product Development which is Axe for women. The areas tackled include the company overview, rationale for product development, target market and value proposition, commercialization and managing product growth. Unilever as a global company has been in the industry for over a century now and it’s related with over 400 brands ranging from food, ice creams, variety of soaps and luxurious shampoos as well as well as other family care products. The new product concept was as a result of the existing product which is Axe for men that has led for the target market to ask for their own product which is almost similar. The target market for the New Product is ladies aged 15 years and above who real care about their dating relationships and are very cautious of their look, smell and feelings. 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