ENTREPRENEURSHIP

MODULE 3
Fundamentals of Product Development

Product Development - It is the process of developing, testing and commercializing a product or service
with the ultimate objective of solving the problem of the primary target market.
Forms of Product
- New Product Line
- Product Line Extension
- Enhancement
- Repositioning Product
4 Sequential Steps in Product Development
1. Developing a Product or Service Description
2. Creating a Prototype
3. Testing the Prototype
4. Validating the Market

Product or Service Description - This describes how a product or service works and how it benefits the
customers. It serves as the blueprint of all business operations.
How to Create a Sound Product or Service Description:
1. It should directly address the primary target market in a personal matter using
everyday language.
2. It should highlight the features that will cater to the customer’s needs or address the
customer’s problems.
3. Realistic superlatives should be used for the product description.
Creating Prototype of the Product or Service
Prototype - It is a preliminary model or sample of a new product or service that is created to test
a product concept or service process.
It lessens implementation/commercialization risks and provides the entrepreneur a bunch of advantages.
Advantages of Creating a Prototype
- Creating a prototype provides the entrepreneur a window to test the performance and
specifications of various materials and service processes.
- Creating a prototype enables the entrepreneur to engage in trial-and-error, provide room for
improvements, and refines the functionality of the product design or service process.
- Creating a prototype elicits respect from key stakeholders and customers. It gives credibility to
the entrepreneur.
- A prototype helps the entrepreneur effectively describe the product or service to the product
team.
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Technique for Creating a Prototype

Testing the Product Prototype

This will uncover the final loopholes that need to be fixed before commercialization and will give the
entrepreneur a leeway to examine and scrutinize the prototype and provide feedback as to what can be
improved before the launch.

Testing Methods Applied Before Validating Prototype

- Focus Group Discussion
Its objective is to identify errors, deficiencies, and issues that may impede the success of the
product.

- Legality and Ethical Test

The entrepreneur must ensure that the product or service complies with all relevant laws and
regulations and has a necessary license or permit to operate a particular business.

- Safety Test
Product - must be safe to use, safe to be consumed and safe to be applied.
Service - the processes to be performed by the service provider must not be detrimental to the
safety and health of the customer.

- Product Costing Test

This is the time when the entrepreneur can match the expected costs versus his or her budget.
Modification in the manufacturing process or service blueprint can still be made at this point to
align with the cost objective of the entrepreneur.

- Component Test
Any failure from each component of product or service must be redesigned and tested again
until it becomes fully operational and functional.

- Competitor’s Product or Service Test

The entrepreneur must test a similar line of products or the competitor’s product or service
itself to compare and get the best practices to be applied to the new product or service.
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Validation of Market Acceptability

It is the process of finding out if the intended primary target market will be buying the product or
availing the service. It either validates or disconfirms the perception of the entrepreneur about the
suitability of the chosen primary target.

In Validating the Product or Service…

1. Will the primary target market like the product or service?
2. Will the primary target market buy the product or service when it is already in the market?
Activities to be done in Validating Market Acceptability
1. Use the most strategic marketing research tool wherein the entrepreneur can get the most
relevant answers in the cheapest way possible.
2. Prepare relevant open-ended questions that answer the objectives.
3. Find market experts who also target the same market but are not directly competing with
the entrepreneur.
4. Collate all the data, analyze them, and prepare a summative report that answers the
objective questions that were mentioned earlier.

Fundamentals of Brand Management

Brand
It refers to the identity of a company, of a service, or an entrepreneur himself or herself. It is a symbol of
promise or assurance from the entrepreneur that what it purports to the customers will happen.

Trademark
Trademarks and service marks are applied to a manufacturer's or a seller's products and services
to distinguish them in the marketplace--a valuable marketing tool, in some circumstances. A trademark
or service mark prevents another person from offering a similar product or service confusingly similar to
yours. If you don't register your trademark, you may be prohibited from using it by someone who has.

Trademark vs Registered
Trademark - The TM and SM symbols are used with unregistered marks: TM for trademarks, or
marks that represent goods, and SM for service marks, or marks that represent services.
Registered - The federal registration symbol, or ®, is reserved for marks registered in the U.S.
Patent and Trademark Office. You may only use the symbol with a federally registered mark and
as applied to the goods and/or services listed in the registration.

Brand Management - The supervision of the tangible and intangible elements of the brand.

Tangible Elements:
 product
 Packaging
 price
 location
Intangible Elements: perception and relationship of the customers with the brand
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BRANDING
It is the process of integrating the strategies formed from the marketing mix to give an identity to the
product or service.

GOALS OF BRANDING

- Driving the customer loyalty and retention.

- Establishing to target customers that the business is reliable and trustworthy and that the
product or service is the superior solution to their current problem
- Differentiating with competitors

ADVANTAGES OF BRANDING

- Brands make it easy to identify the product or service.

- It assures the buyer that they get the same quality of products.
- It reduces price comparison
- It adds prestige to the product of the seller
- It provides legal protection for the seller
- It helps in product market segmentation

Characteristics of Good Brand Name

1. Unique
2. Extendable
3. Easy to remember
4. Can describe the benefits of the product or service
5. Can describe concrete qualities
6. Can be converted to other dialects or languages in case the entrepreneur expands to other
territories
7. Positive and inspiring

Popular Types of Brand Names

Descriptive
They are those that readily convey the service or product offered by a company. Because of this, they
tend to be unremarkable. While functional and utilitarian, these leave little room for creativity on the
part of the brand or interpretation on the part of its audience.

Evocative
These employ suggestion and metaphor to bring to mind the experience or positioning of a brand. They
are singular and creative, and make for powerful differentiators. Because evocative names tend to be
nonlinear and multidimensional, they represent an opportunity to forge a profoundly meaningful brand
that is bigger than just the goods and services it offers.
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Invented
These are fanciful fabrications that are nothing if not distinctive. These types of names offer the most
creative latitude for a brand, but that doesn’t mean they’re easy to dream up. Many are built from Latin,
Greek, or other foreign root words and modified to best embody the brand personality. While they’re a
breeze to trademark, they can require a lot of time and hefty marketing spend to establish meaning in
the eyes of customers.

Lexical
These rely on wordplay for their memorability. Puns, phrases, compound words, alliteration,
onomatopoeia, intentional misspellings, and foreign words are all styles of this popular naming type.
Lexical names are often clever—sometimes, arguably, too clever—and get their impact from pairing or
modifying existing words for linguistic effect.

Acronym
It is one of those naming types with straightforward, utilitarian purpose. Acronyms have been used for
brand names since branding first crawled out of the primordial soup. As a rule, though, acronyms are
hard for audiences to remember and even harder for attorneys to trademark.

Geographical
It imbued a brand with all the cultural and historical associations its namesake is known for—for better
or worse. This can often find by companies who once catered to a geographically limited audience but
have since made it big. These types of names have almost all been used before.

Founder
Whether for reasons of heritage or hubris, there will always be brands named for the people who
started them. This tradition stretches back to the earliest brands as well. Aside from sating the egos of
their principals, founder names are definitely easy to trademark. They can be distinctive if positioned
correctly, but require some marketing efforts to build equity (unless, the founder is already famous).