**6. Success and failure in new product development**

The interrelation of the market environment, new product strategy and development process that influences the success of a new product. When new product concept is developed, the introduction of it to the market has to be made in an effective and efficient way. For this purpose, organizational factors such as inter-functional coordination, structure and leadership must be involved in the process heavily [18].

Literature has shown that there are various elements affecting success of a new product. These elements are categorized under three groups below [19]:

customer needs or requirements to satisfy the customers beyond their expectations. The success of the newly developed product would begin with the success of planning and implementation of the new product launch and maintenance of the sustainability of this success by the marketing department. The duty of marketing to make the new product successful requires the transition from 7P to 7 N that summarizes the marketing mix elements as new product, new price, new place, new promotion, new physical environment, new process and new people. Thus, with the new product, the price, the place, the promotion, the physical environment, the process and the people elements should be replanned and re-implemented. 7 N product life cycle (PLC) should be adapted at each stage of the marketing strategy. As a matter of fact, incorrect marketing practices such as incorrect price, insufficient promotion, distribution to the wrong market segment, presentation of product to the consumer in an unattractive design and environment, not using the interdisciplinary team work in the process and not being able to enter to the market before competitors are known as reasons for failure of the new product. New product development for a company is the development of product mix or portfolio. While the product portfolio is developed as important innovations, it can also be developed as product advancement, repositioning of product or product additions. For example, how does the production of a door that includes a face recognition algorithm allowing to recognize faces even from distant locations affect door manufacturer's product portfolio? And, how does production of this kind of door before by competitors affect the sales and market share of the manufacturer? The production of a face recognition door by this manufacturer will enlarge the product portfolio. The production of different varieties of the door such as lock opening, automatic opening, etc. contributes to the length of the product line. The development of locking features such as door opening by a card reading or a device from inside of the lock contributes to the depth of the product line. Not adding this kind of door to the product mix by the door manufacturer although there is a demand by consumers in the target market will lead to a decrease in the market share, or producing it after competitors will lead to loss of taking the best part of the market and increase in the cost of winning the customers lost to the competitors.

Theory of New Product Development and Its Applications

http://dx.doi.org/10.5772/intechopen.74527

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Kotler and Armstrong bring several reasons explaining why do so many new products fail, while there are clear instructions about how a new product development can be successful. The first reason is overestimating market size which will cause to overproduction resulting in profit loss. The second reason is poor design of a new product that will not be attractive as much as for potential customers. The third reason is producing it for the wrong segment of market such as selling a luxury product in an economically struggling region. The fourth reason is releasing new product to the market at a wrong time, for example, producing a high-tech product for the use of people at the time of an economic bottleneck when people hesitate spending money for products not necessary for daily needs. The fifth reason is pricing it wrongly, too expensive or too cheap which both will lead to loss in profit. The sixth reason is poor advertisement which will prevent a new product being known by the right customers [2].
