03 Product Development Factors

7/31/2019 03 Product Development Factors

1/53

Empathic DesignAnd Design Thinking.


2/53

Empathic Design

Introduction What is Empathic Design

The Whole Product Model

The Kano Model

Summary


3/53

Empathic Design

What is Empathic DesignDelighting customers is vitalrequirement for survival within

todays unpredictable marketplace.Products must now appeal at the

emotional level, surprising them by

giving them things they never knewthey needed.


4/53

Empathic Design

What is Empathic DesignEven the most talented productdesigner would be wise to use

customers and users as a source ofinspiration, however customers oftenfind it hard to tell designers what will

excite them about products in thefuture.


5/53

Empathic Design

What is Empathic DesignEmpathic design encompasses avariety of techniques that are

participatory, in-depth and qualitativein nature. The aim is to equipdesigners with uncaptured customerinformation that helps to stimulate

innovation and differentiate theirproduct and to delight customers.


6/53

Empathic Design

The Whole Product ModelIt allows a more comprehensiveconception of a product, one which

incorporates elements beyond itstechnical capabilities. Why?

- product differentiation deteriorates

over time; and many customers rankintangibles as equally as important.


7/53

Empathic Design

PotentialAugmentedExpectedCore

The Whole Product Model


8/53

Empathic Design

Core Elements: The absoluteminimum elements a product musthave. For instance a car must have

an engine & wheels. Expected Elements: Those elements

which the customers expect the

product to have. For example a caris expected to have a radio andintermittent windscreen wipers.


9/53

Empathic Design

Augmented Elements: Which furtherdifferentiate the product, such as

Volvos side impact air bags, or

Nissans 6 year corrosion warranty. Potential Elements: Often intangible,

but give added value the feeling of

driving a Mercedes or aboveeveryone else in a Land RoverDiscovery.


10/53

Good examples..

Core elements


11/53

Expected Elements


12/53

Augmented elements

Consumer is temped to give their I-Pod

unique/additional features etc.


13/53

Potential elements


14/53

Empathic Design

As a market matures, expected andaugmented elements become coreelements. For example, intermittent

windscreen wipers, originally forlorries, became an extra for the carmarket, and now seen as a Coreelement. Airbags, first an optionalextra became standard and noweverywhere.

These elements often effect price..


15/53

Products that wowed!


16/53

Empathic Design

An Extremely Brief History!The Kano Model: was formallyintroduced to the world in 1982 by

Professor Noriaki Kano of Tokyo RikaUniversity. The paper was called

Attractive Quality and Must-Be

Quality at the 12th

Annual Meeting ofthe Japan Society of Quality Control.


17/53

Empathic Design

The Kano Model

Excitement

Basic

Performance

Delight

Dissatisfaction

Low High

Level of

achievement


18/53

Empathic Design

The Kano ModelThe Model shows that customerresponses can be classified into 3

types: Basic

Performance

Excitement


19/53

Empathic Design

Basic:For example, when going for a meal,the customer expects there to be a

place setting. If there isnt one thecustomer will be dissatisfied. If thereis one, no credit will be given

because there is supposed to be one!


20/53

Empathic Design

Performance:The customer expects their order tobe taken promptly, accurately and the

food delivered in reasonable time.The better the restaurant meetsthese needs, the more satisfied thecustomer is!


21/53

Empathic Design

Excitement:Excitement is generated because thecustomer received some feature that

they did not expect. That is to say therestaurant providing free champagne

on the house.


22/53

Empathic Design

SummaryCompetitive products must flawlesslyexecute all three types. Meeting

customer needs provides thefoundation for removingdissatisfaction. Exceeding the

customers performance expectationscreates competitive advantage.


23/53

Quick Break..

Grab a drink, back in 10 mins please. Point of interest: Future phone design concepts

from the 1970s !!!


24/53

> There are four principle psychological

factors:(1) Motivation

(2) Perception

(3) Learning

(4) Beliefs/Attitudes

Psychological influences


25/53

Market Segmentation

> Human needs and wants are an essentialcatalyst within the marketing concept.Maslow advocates that there varying levelsof need:

> Basic Physiological Needs (food, sleep,temperature)

> Safety Needs (protection from danger)

> The Need for Recognition (love, belonging)

> Ego Needs (self esteem, respect from

others)

> Self-fulfilment (realisation of one's totalbeing, creativity)


26/53

Maslows Hierarchy ofNeeds

Self Actualisation

Esteem Needs

Belongingness andLove Needs

Safety Needs

Physiological needs


27/53

Consumer Behaviour

> Many consumer purchases are individual.When purchasing a Mars bar a person maymake an impulse purchase upon seeing anarray of confectionery at a newsagent'scounter

> However, decision-making can also be madeby a group such as a household. In such asituation a number of individuals may interactto influence the purchase decision. Eachperson may assume a role in the decision-

making process. Five roles are outlinedbelow. Each may be taken by parents,children or other members of the buyingcentre


28/53

Buying decision process

> This involves focusing on three distinctelements:

(1) The buying roles within the decisionmaking unit;

(2) The type of buying behaviour; and

(3) The decision process


29/53

Consumer Behaviour

Within the buying process there are five roles:

(1) the Initiator

(2) the Influencer

(3) the Decider

(4) the Buyer

(5) the Users


30/53

Consumer Behaviour

>Initiator: the person who begins the processof considering a purchase. Information maybe gathered by this person to help thedecision

>Influencer: the person who attempts topersuade others in the group concerning theoutcome of the decision. Influencers typicallygather information and attempt to imposetheir choice criteria on the decision

> Decider: the individual with the powerand/or financial authority to make theultimate choice regarding which product tobuy


31/53

Consumer Behaviour

> Buyer: the person who conducts thetransaction. The buyer calls the supplier,visits the store, makes the payment andeffects delivery

> User: the actual consumer/user of theproduct


32/53

Consumer Behaviour

> One person may assume multiple roles in thebuying group. In a toy purchase, forexample, a girl may be the initiator, andattempt to influence her parents, who are thedeciders. The girl may be influenced by her

sister to buy a different brand. The buyermay be one of the parent who visits the storeto purchase the toy and brings it back to thehome. Finally, both children may be users ofthe toy

> Although the purchase was for one person, inthis example marketers have fouropportunities-two children and two parents-toaffect the outcome of the purchase decision.


33/53

Phases within the buyingprocess

> Within the buying process there are a fivekey phases:

(1) Recognition of the problem

(2) The search for information involving four

distinct sources:- personal sources

- public sources

- commercial sources

- experimental sources(3) Evaluation of alternatives

(4) The purchase decision

(5) Post-purchase behaviour


34/53

The Buying Process

> The influencing factors include: the productsattributes (price, performance, quality and

styling); their relative importance to theconsumer; the consumer's perception of eachbrand's image; and the consumer's utilityfunction for each of the attributes


35/53

Design decisions

> By understanding the issues related toconsumer analysis it is then possible to beginto modify the product offering by:

(1) changing the physical product (addingfeature/repositioning)

(2) changing beliefs about the product(psychological repositioning)

(3) changing beliefs about competitorsproducts (competitive depositioning)


36/53

Design decisions

(4) changing the relativeimportance of particularattributes - as a product moves

through the product life cycle

(5) emphasising particularproduct features previously

ignored(6) change buyers' expectations


37/53


38/53

Th ti f d t


39/53

The notion of productchange

> The main purpose of the product life cycle isto remind us of three characteristics: (1) thatproducts have a limited life; (2) that profitlevels are not constant, but change

throughout a products life; and (3) that theproduct requires different strategies at eachstage of the lifecycle (Kotler 1992)

> Within the Product Life Cycle a producttravels through a series of stages. The ability

to mange and react accordingly to thesestages determines the success or failure ofthe product

St d d P d t Lif


40/53

Standard Product LifeCycle (PLC) Curves

> The main implication of the PLC is to avoidhaving a high proportion of a company'sproducts at the end of their life cycles.Drucker (1963) has established that thereare six categories of products which relate tothe notion of product elimination:

(1) Tomorrow's Breadwinners

(2) Today's Breadwinners - yesterday'sinnovation

(3) Products capable of contributing to profit

with substantial help(4) Yesterdays Breadwinners

(5) Also Ran's

(6) Failures

St d d P d t Lif


41/53


> The purpose of these categories is todetermine which products should bemaintained, built upon or eliminated. ThePLC also provides valuable information foranalytical tools (such as the Boston Matrix

and GEC model)> Many of the lifecycle curves indicated are

generalised and the shape of curves will varywidely from product area to area and fromcompany to company

> It must also be noted that there is nothingfixed about the length of a cycle or thelength of its various stages

St d d P d t Lif


42/53


> It has been suggested that the length of thecycle is governed by:

(1) the rate of technical change

(2) the rate of market acceptance

(3) the ease of competitive entry

Product life cycle 1: Introduction 2: Growth 3: Maturity 4: Decline


43/53

Product life cyclephases 1: Introduction 2: Growth 3: Maturity 4: Decline

MarketCharacteristicsSales Low Increasing rapidly Peaking DecliningCosts per customer High Average Low LowProfits Negative Increasing High Declining/negativeCustomer type Innovators Early adopters Middle and late majority LaggardsCompetitors Few Increasing, some

emulators High but beginning todecline Decline with rapidshakeoutCompetitors strategies Unfocussed and indirect Attempting to achieve

trial. Undifferentiatedproducts, services.Emphasis on fighting forshare

Price cutting to achievevolume. Fighting formarket share butexperiencing difficulties.Emphasis on efficiencyand low cost. Shake-outof weakest players

Exit of some competitors

Marketing MixStrategiesProduct Basic product Developing product

extensions and servicelevels

Modify and differentiate.Develop next generation Phase out weaker brands

Price Low price strategy Penetration strategy Price to meet or beatcompetitors Reduce

Distribution Selective Intensive. Limited tradediscounts Intensive. Heavy tradediscounts Selective. Phase out wealoutletsAdvertising Heavy spending to raise

awareness and encouragetrial among early adoptersand distributors

Moderate to buildawareness and interest inmass market. Greaterword of mouth

Emphasise branddifferentiation, specialoffers

Reduce to a level thatmaintains hard coreloyalty. Emphasise lowprices to reduce stock

Sales promotion Extensive to encouragetrial Reduce to a moderatelevel Increase to encouragebrand switching Reduce

Planning time frame Short to medium Long range Medium range ShortDevelopment structure Task force Product division Business division with task

for new productdevelopment

reduce

P d Ad i d


44/53

Product Adoption andConsumer Profiles

> When a new product is introduced, noteveryone adopts it at the same moment. Therate of adoption within the market place hasbeen identified as following a recognisablemodel

> A method of adopter categorisation is thus:

Product Adoption and


45/53


Innovators

Early

Ad

opters

EarlyMajority

Laggards

LateMajority

Product Adoption and


46/53


> Innovators: young educated consumers,profitable risk taking organisations,sometimes category specific

> Early Adopters: more mainstream, opinionleaders, need wooing

> Early Majority: risk adverse, needreassurance, social pressures

> Late Majority: have greater product choice,

product possibly mature by now> Laggards (late adopters): possibly older,

less well off


47/53

Basic buyer analysis..

What do they buy? Why do they buy?

Who is involved in buying?

How do they buy?

When do they buy?

Where do they buy?

Buyer Behaviour Model


48/53

Buyer Behaviour Model..

External Stimuli Buyers Black Box Buyer Decision

Political,Economical

Political,

Technological

Buyercharacteristics:Cultural, Social,

Personal.

Product: Quality,suitability,aesthetics,

ergonomicsusability.

Product, Price,Advertising

Problem/desire. Brand recognition

Distribution. Searches from

information.

Dealer influence,

knowledge.

Evaluation. Quantity.

Decision. Purchase timing.

Buyer thinking


49/53

Buyer thinking..


50/53

Competitor Mapping

Product Mapping


51/53

Competitor Mapping


52/53

Competitor Mapping


53/53

Competitor Mapping

Documents

03 Product Development Factors