TLE: MODULE
2
ENVIRONMEN
T AND
MARKET
(QUARTER 1-PART 3)
OBJECTIVES
1. To know the factors on the
environment and market;
2. provide possibilities for a business to expand and
make more profit;
3. To know the concepts of product development;
4. To make a basic SWOT analysis and business
plan.
ENVIRONMENT AND MARKET
Aspiring entrepreneur need to explore the
resources, raw materials, economic, cultural, skills,
technology and social conditions prevailing in an
area. They should always be watchful of existing
opportunities and constraints, and to take
calculated risks. The opportunities in the business
environment are factors that provide possibilities
for a business to expand and make more profit.
PRODUCT DEVELOPMENT
Refers to a process of new product to be sold by
a business or enterprise to its customers product
development may involve modification of an
existing product or its presentation, or
formulation of an entirely new product that
satisfies a making a new wants and/or a market
place. Newly-defined customer's needs, wants
becomes ready for production.
QUESTIONS THAT YOU CAN ASK YOURSELF ABOUT
PRODUCT DEVELOPMENT:
1. For whom are the product/services aimed
at?
2. What benefit will the customers expect from
product/service?
3. How will the product/service differ from the
existing brand? From its competitor?
NEEDS
ESSENTIAL TO AN INDIVIDUAL TO LIVE WITH DIGNITY AND
PRIDE IN A COMMUNITY. THESE NEEDS CAN OBVIOUSLY HELP
YOU GENERATE BUSINESS IDEAS.(ex.FOOD, SHELTER,
CLOTHING, HEALTH, EDUCATION, ETC.)
WANTS
ARE DESIRES, LUXURY AND EXTRAVAGANCE THAT SIGNIFY
WEALTH AND EXPENSIVE WAY OF LIVING. WANTS OR DESIRES
ARE CONSIDERED ABOVE ALL THE BASIC NECESSITIES OF LIFE.
(ex.FASHION ACCESSORIES, MOVIES, JEWELRY, EXPENSIVE SHOES &
CLOTHES, TRAVELS, EATING IN EXPENSIVE RESTAURANTS, ETC.)
CONCEPTS OF PRODUCT DEVELOPMENT
The process of product development follows the following
stages.
1. IDENTIFY CUSTOMER NEEDS: Using survey forms,
interviews, researches FOCUS group discussions and
observations, an entrepreneur can easily identify customers'
needs and wants. In this stage, the information that can be
possibly gathered are product specifications (performance,
taste, size, color, shape, life span of the product, etc.). This
stage is very important because it would determine the
product to be produced or provided.
CONCEPTS OF PRODUCT DEVELOPMENT
2. ESTABLISH TARGET SPECIFICATIONS: Based on customers'
needs and reviews of competitive products, you can now
establish target specifications of the prospective new product
and/or services. A target specification is essentially a wish-list.
3. ANALYZE COMPETITIVE PRODUCTS: It is imperative to
analyze existing competitive products to provide important
information in establishing product or service specifications.
Other products may exhibit successful design attributes that
should be emulated or improved upon in the new product or
service.
CONCEPTS OF PRODUCT DEVELOPMENT
4. GENERATE PRODUCT CONCEPTS: After having gone through
with the previous processes, you may now develop a number of
product concepts to illustrate the types of products or services
that are technically feasible and will best meet the requirements
of the target specifications.
5. SELECT A PRODUCT CONCEPT: Through the process of
evaluation between attributes, a final concept is selected. After
the final selection, additional market research can be applied to
obtain feedback from certain key customers.
CONCEPTS OF PRODUCT DEVELOPMENT
6. REFINE PRODUCT SPECIFICATIONS: In this stage, product or services
specifications are refined on the basis of input from the foregoing
activities. Final specifications are the result of extensive study,
expected service life, projected selling price among others are being
considered in this stage.
7. PERFORM ECONOMIC ANALYSIS: Throughout the process of
product development, it is very important to always review and
estimate the economic implications regarding development expenses,
manufacturing costs and selling price of the product or services to be
offered or provided.
CONCEPTS OF PRODUCT DEVELOPMENT
8. PLAN THE REMAINING DEVELOPMENT
PROJECT: In this final stage of concept
development. You can prepare a detailed
development plan which includes list of
activities, necessary resources and expenses
and development schedule with tracking
progress.
FINDING VALUE
People buy for a reason. There should be
something in your product or service that would
give consumers a good reason to go back and buy
more. There must be something that will make you
the best option for target Customers, otherwise,
they have no reason to buy what you are selling.
VALUE PROPOSITION is a believable collection of
the most persuasive reasons why people should
notice you and take the action you're asking for.
INNOVATION
The introduction of something new in your product or
service. This may be a new idea, a new method, or a new
device. If you want to increase your sales and profit. you
must innovate. Some of the possible innovations for your
products are change of packaging, improvement of taste,
color, size, shape, and perhaps price. Some of the possible
innovations in providing services are application of new and
improved methods, additional featured services, and
possibly freebies.
UNIQUE SELLING PROPOSITION (USP)
The factor or consideration presented by a seller as the reason that one
product or service is different from and better than that of the
competition. Before you can begin to sell your product or service to
your target customers, you have to sell yourself in it. This is especially
important when your product or service is similar to your competitors.
BRANDING
A marketing practice of creating a name, a symbol or design that
identifies and differentiates product or services from the rest. It tells
them what they can expect from your product or service and it
differentiates your offerings from other competitors. Your brand is
derived from who you are, who you want to be and what people
perceive you to be.
SWOT ANALYSIS
A managerial tool used to assess the environment.
It is used to gather important information which is
then used in strategic planning. Strengths and
weaknesses are internal in an organization. They
relate to resources owned by an organization that
you have control over and also the extent of its
marketing. Strength, Weaknesses, Opportunities
and Threats (SWOT) Analysis.
