MEANING OF NEW PRODUCT
In simple words, new product means any product that has not been launched by a producer till today. But it is a narrow term. Broadly new product means any product which creates new market or with which a company enters into market for the first time or which supports present (existing) product. (For example mobile has created new market, T.V. manufacturer enters into food & beverage industry with soft drink, making modification such as shapes, packing, size, and flavor and so on in existing product)
Categories of New Product
- Purely Innovative (unique) product: This category includes those products which are really innovative or entirely new for the company and the market. These are the items or products for which there are no existing substitutes. For example, HIV AIDS curing drug developed by the scientists.
- Replacement for existing product: Improvements and revisions of existing product. This category includes those new products that provide improved performance of greater perceived value. The company replaces the old product and introduces a new product with additional facilities, features and better performance. For example, instant coffee replaced coffee beans, color TV replaced black & white TV etc, and smart mobile phone replaced simple mobile phone.
- Imitative Product: This category includes those new products that allow a company to enter an established market for the first time. It means that the product is new for the organization but it is not in the market. E.g. when a company introduces a washing machine which is already there in the market, produced by other companies.