Product Development & Market Strategies

Assignment Taken

Prepare Product development plan & Prepare A market entry, distribution strategy and brand building plan

Case Understanding

Global automakers are struggling to find new and sustainable alternatives to fossil fuels, for decades. With the increased environmental awareness among people and the impending changes in the climate, ecosystems, and nature, now the need to switch from fuels to other environmental-friendly alternatives is more than ever. The world has now joined hands together and pledged for a carbon-neutral world with zero carbon emission. Electric vehicles would be a key player to help achieve that goal. As compared to other countries, the market share of electric vehicles is extremely low in India. India is also already showing its keen interest to be a major part of this automotive paradigm shift. Adding to that, India has already put forward the desire to become the biggest hub for electric vehicles in the future and offer various incentives and schemes for individuals choosing electric vehicles. Industry leaders consider electric cars to be a promising option. Electrification will help reduce vehicular emissions, a key contributor to air pollution which causes an average 3% GDP loss every year, reports suggest. As a start-up with 8 budding entrepreneurs foraying into the electric vehicle business with limited resources. Technical expertise, time, resources, and finances are the major challenges the start-up needs to tackle. The Charging infrastructure for e-mobility is also an area of concern for electric vehicles. Nobody wants to be stranded in the middle of a road and while waiting for a charging station to be installed there. Moreover, the battery charging system of an EV can take a couple of hours which can be another problem as well. Making the customers break away from the old norms and establishing new consumer behavior is always a challenge. It is common to find users anxious about the product and its usage.

BCS Solution Summary

Product Development Plan The product development process encompasses all steps needed to take a product from concept to market availability. This includes identifying a market need, researching the competitive landscape, conceptualizing a solution, developing a product roadmap, building minimum variable product, etc. This innovation does not come for free and, for most EV buyers, the cost is a significant consideration. Making the proper trade-offs across performance, efficiency, driving range, and the cost is a major challenge for manufacturers. These trade-offs must be evaluated and iterated many times during the development process as the design evolves, the market changes, and competitors emerge. A successful EV product requires near-flawless execution of this process. In addition, the development team must deal with the general challenges of vehicular design, including close interaction among electrical and mechanical components and an operating environment with variable temperature and humidity plus noise and vibration. The foundation for the success of a product is laid in the product development process (PDP). It includes all phases of development and describes the core processes involved in launching a product on schedule, on budget, and with the desired quality. Market Entry Strategy Market Entry strategy outlines your business goals, an overview of the target market, precisely what you will sell there, expected sales, and how you will achieve them. A typical market entry plan can take six to 18 months to implement. A market entry strategy gives you and your team the overall direction for your export project 1. Set clear goals 2. Research the market 3. Chose the right mode of entry 4. Consider finances Distribution strategy A distribution strategy is a method of disseminating goods or services to end-users. Implementing the most efficient distribution method for your business is key to obtaining revenue and retaining customer loyalty. Some companies opt to use multiple distribution methods to adhere to different consumer bases. Selecting the correct distribution strategy for your business depends on the type of item you are creating, your customer base, warehouse capabilities, and logistics support. 1. Direct Distribution 2. Selective Distribution Brand Building Plan Brand building is all about communicating and exposing your brand. That is just one side of it. The best way to define it is that it is a process of creating value for consumers. It encompasses all things that consumers know, feels, and experience about your business in its entirety. 1. Define the brand 2. Differentiate and position the brand 3. Build and expose the brand 4. Personalize the brand 5. Review the brand

Solution

Management Principle: Laying the Best and practical Product Development process (PDP) and right market entry and distribution strategy with clear-cut goals and researching the best possible path with a clear brand building plan.

Product Development Plan

The foundation for the success of a product is laid in the product development process (PDP). It includes all phases of development and describes the core processes involved in launching a product on schedule, on budget, and with the desired quality.

Of the millions of customers who make purchases on a daily, a vast majority of them remain unaware as to what a difficult and tedious a new product development process that each and every product had to endure before they could be in a position to place those products in the market make the customer buy. In order for a business or an entrepreneur to successfully introduce a product into the market, several hurdles need to be overcome, and there must be a thorough understanding of the market, customers, and competition to ensure that the product is able to fill a real demand and offer satisfaction and quality to customers. Below are the stages or steps in the product development process

1. Idea Generation: The starting point for every new development is the concept. This is where the outlines and framework conditions for the vehicle segments, markets, technology, deadlines, costs, and pricing are determined and defined. From a technical perspective, the drafting of a vehicle concept involves creating a package and safety concept, conducting a potential analysis, developing a body-in-white structure concept and aerodynamics values, and defining the production technology. Styling designs are created based on an ideation process. To ensure the success of the product, technology comparisons with competitors are conducted and benchmarks defined, and so on. The company thereby focuses on coming up with as many feasible ideas as possible. 
2. Concept Development: The concept development and assurance stage involve the design and production of digital prototypes as well as detailed planning and finalization in the specifications. Beyond simulation, initial testing with unit carriers takes place. Following the selection of the final styling model, refinements begin that will continue into series production of the vehicle. Typical project requests in this product development process phase concern the development and creation of a demonstrator or prototype. The starting point is rough drafts or product profiles provided by the customer. Based on them, Engineers take overall development processes from design to calculation and trials as well as the setup, application, and testing. Moreover, all development-related functions such as procurement, logistics, and quality management are handled internally and contribute massively to the successful implementation of the project.
3. Testing: In the development process, absolutely nothing can be left to chance. Every development step, every component, be it the body, electrics/electronics, chassis, engine, or the complete vehicle, is tested and optimized under realistic conditions. Individual components and entire vehicles are tested for durability and must withstand the toughest conditions. Whether on the test bench or on the testing grounds, it should be only satisfied when the absolute optimum result has been extracted from the developments.
4. Development of Marketing Strategy:  The company should come up with strategies to introduce the product into the market. Its value propositions, tagline, and USP’s. The company must come up with the price, potential revenue figures as well as advertising and distributing channels in this step.
5. Business Analysis: The product concept is put through a vigorous business analysis or test in order to ascertain projected sales and revenue and also assess risk and whether the production of the product is financially feasible. The company’s objectives are considered, and if these are satisfied, the product is moved on to the next step.
6. Market Development & Testing: Declaring a product concept to be in line with the goals of the company and issuing a green light for development.  The research and development wing of the company then works or tinkers on the product concept for many months to get an optimal solution for customers from both technical and economic perspectives. Involves the testing of the product and its suggested marketing program in realistic market settings. This stage provides an insight into how the product will be introduced into the market, advertised, produced, packaged, distributed, and eventually sold to the customers, and therefore any optimizations if required can be made by the company. 
7. Commercialization: The final step of the product development process is that of commercialization. Based on the information gathered during the test marketing process, the business management may either decide to go ahead with the launch of the product or put it on the backburner. In case the go-ahead is given, the product is finally introduced into the market, and this process is called commercialization. This stage often leads to massive costs in terms of initial infrastructural investments as well as sales promotions and advertisements. 

 

 

Market Entry Strategy

 

1) Revolutionary Innovation– here, the markets and customers remain established, but the technology and/or production competencies are overturned. This can present problems for incumbent firms in that they may need to build new technology and production competencies through re-skilling, leading to less of an advantage over a new firm. Still, familiarity with market segments and existing customer relationships help.

2) Niche Creation – here, the innovation builds on technology and production competencies already resident in the organization, but is targeted at markets unfamiliar to the firm or requires the creation of new customer linkages and unique selling points to attract customers and penetrate into the market.

3) Architectural Innovation – here both the technology and production competencies are overturned and the innovation is targeted at markets unfamiliar to the firm or requires the creation of new customer linkages. This category of architectural innovation is thus the most difficult for an incumbent firm to accomplish and offers the most strategic conditions for a start-up venture to challenge a firm.

 

A five-step approach to creating a winning market entry strategy to expand into a new market.

1. Set Clear goals

•  business goals for the expansion
• your targeted level of sales
• the specific product or service you’ll export
• the target markets
• major action items and a timeline for achieving them
• needed adaptations to products, packaging and branding tailored to the target market

 

1. Research the market

•  size of the market
• consumer trends, needs and perceptions of products like yours
• domestic competition
• your unique value proposition in the market
• regulatory, certification, trade and other barriers and opportunities
• do online research, including in publications, studies and statistics available from governments and international bodies
• talk to other businesses operating in the target market

 

1. Choose the mode of entry

•  Using the services of an in-country distributor or agent.
• Acquiring an existing local business.
• Partnering with a local business. This can take various forms, such as franchising, licensing, a joint venture, co-production and cross-manufacturing.
• Opening a physical presence. This can be anything from buying or renting an office to hiring a local representative.
• Selling through online marketplaces.

 

1. Consider financing and insuring needs

•  credit insurance in case a customer doesn’t pay or a contract is canceled
• performance security insurance in case a customer wrongfully calls a letter of guarantee or in the event of political risks

1. Documents the plans and actions

 

 

Distribution strategy

 

A distribution strategy is a method of disseminating goods or services to end-users. Implementing the most efficient distribution method for your business is key to obtaining revenue and retaining customer loyalty. Some companies opt to use multiple distribution methods to adhere to different consumer bases. 

Selecting the correct distribution strategy for your business depends on factors such as the type of item you are creating, your customer base, warehouse capabilities and logistics support.

Direct Distribution:

Direct distribution is a strategy where manufacturers directly sell and send products to consumers. There are a few different ways to implement this method. Some organizations may opt to take a more modern approach and use an e-commerce website where users can make a purchase online. This is an effective option for companies with a client base that’s moderately knowledgeable about technology, requests a specific solution to meet needs or is devoted to a particular brand.

Another direct distribution method is through catalogs or phone orders. This option may target an older customer base or users in specific industries that are attuned to placing orders this way.

One important factor to consider when implementing a direct distribution strategy is the amount of investment required. For example, manufacturers will need to add warehouses, vehicles and delivery staff to their portfolio to effectively distribute goods on their own.

Selective Distribution:

Selective distribution is a middle-ground option between intensive and exclusive distribution. With this strategy, products are distributed in more than one location, but not as many as with an intensive distribution strategy. For example, clothing from different brands may be offered selectively. A brand like Gucci may choose to distribute its items to its own stores in addition to a few selected department stores rather than placing its products in a range of locations such as Walmart or Target. This can help craft an implicit high-end brand message while also increasing the opportunity for shoppers to purchase one of its products. Making a deal with retailers to sell the products under a specific brand or exclusively opening their own storefronts in the future when finances are stabilized will be the best strategy for the start-up.

 

 

Brand Building Plan

 

1. Define the Brand

The first stage in brand building is defining your brand. This is a very critical step as it ultimately determines what your brand truly stands for. When defining your business brand, you should create a checklist of its core strengths. Similarly, if you’re defining a personal brand, you should look at the skills and expertise that you possess especially those which stand out. On the same token, you also need to know what your brand stands for and what is important for your brand (brand values). Your values should in one way or another show that you are contributing to the environmental, social, and economic well-being of consumers. You may not realize some of these important aspects of the brand building immediately until you look at them objectively.

Tag line: Future that is accessible and affordable

2. Differentiate and Position Your Brand

Before embarking on brand building, you have to take time to differentiate it so that you can attract attention and stand out from competitors.  To differentiate your brand, you have to create a unique advantage in the mind of consumers not merely getting attention by brand building colors or logos, or other superficial elements. Once you come up with a unique value proposition, you should use a good branding strategy to position your brand in a way that will help consumers see and appreciate the greater value of your brand over competing ones in the market.

3. Build and Expose your Brand

As I indicated earlier, brand building is not a one-off thing. Building a unique and powerful personal or business brand takes time and consistency.     To build your personal brand, you have to keep reinforcing your values and skills by taking up new roles and assignments that will give you more exposure.  Alternatively, you can use promotional channels, blogs, forums, and social media to create a voice for your personal or business brand.

When building your brand, you should also endeavor to develop brand personality (what people know, think, and say about you). This is what drives or motivates people to identify with and engage with your brand.  The truth is; if you execute your brand-building strategies consistently, then you will easily establish a pattern that will forever be associated with your brand name.

4. Personalize your Brand

If you want your brand-building campaign or brand to be successful, then you have to personalize it. It is important to give your brand identity. Let consumers see and experience the personality of your brand in its entirety. Look at your brand as something that a consumer wants to identify with pretty much as they would with their favorite cars, cell phones, or computers.

As you engage in brand building, you should also invite customers to be co-creators of brand values so that they can feel that they also own it and relate with it.  Top brands encourage consumer-brand interaction by personalizing products to meet the needs and preferences of consumers.  When you personalize your brand, you give consumers a reason to participate and engage with your brand for a lifetime.

5. Review Your Brand

Your brand is not static; it will go through a range of motions in its lifetime. Depending on your brand strategies, your brand will either grow in strength, or remain dormant, or recede with time. In the brand cycle, new events, changes, and circumstances bring challenges and opportunities to enhance the value of your brand or re-establish it. All these possibilities should give you the impetus to take charge of your brand-building activities.

As your brand name grows, so do the responsibilities and expectations to continue with brand building.  The best way of ensuring brand growth is by reviewing your activities and evaluating your successes through metrics such as levels of brand awareness and levels of engagement. Regular reviews will help you seize and exploit new opportunities while upholding your commitment to remain true to your vision and brand strategy. It will also help you steer your brand in the right direction and keep it relevant as you move into the future.

As you can see, brand building is not a one-off thing. You have to define your brand, differentiate, present it, and review what your brand stands for from time to time. It is very important to be clear about your branding strategies and how you’re going to implement them.  You should also adopt brand strategies that will add value to your consumers and help them develop the right impression of your company and what it truly stands for.

Conclusion

Detailed processes and specifications should be implemented with great expertise. At the same time, the engineers demonstrate great flexibility and creativity in developing custom solutions, both in terms of technology and process, even where the specifications are less precise. While the focus is clearly on the technology when needed processes can be adjusted pragmatically to bring the projects to a successful conclusion. Regardless of what type of development or the phase of the Product Development Process (PDP) that engineers are currently working on, the preceding and subsequent process steps are always taken into account, or otherwise incorporated into the overall process, in order to ensure smooth integration with the customer environment. The automobile manufacturing field is ever-growing with the increasing digitization and virtualization of PDPs. A direct-distribution method with selective strategies will be the best distribution strategy for the start-up. Brand building is not a one-off thing. You have to define your brand, differentiate, present it, and review what your brand stands for from time to time. Climate change is widely recognized as a serious and growing challenge society is facing. A major contributor to climate change is automotive vehicle emissions. And foraying into this sector has a lot of growth potential and opportunities when done rightly.

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