New Product Paper Essay
New Product Paper
Set a price for a new to the world consumer (this means a product that is not on the market) product. Identify a new product you think could be successful on the market and set an introductory price for it. Use the following questions to structure your written analysis.
a. What is the product name? Describe the product.
The name of my product will be H2O run vehicle. The product is a vehicle, car or truck that uses water and electric to run it and do not use any fossil fuel. The car would not “technically” be running on the water but the HHO gas which is what the H2O would be change to for this to work. This vehicle would be an electric/water hybrid. The way it works is water which is H2O (hydrogen and oxygen), but when you separate the elements and use the hydrogen, it can be used like gasoline. When it is put in the sparkplugs you get an explosion in the piston and this is what runs a vehicle.
b. Identify and explain which market segmentation variable you are using. The European countries are the areas that I would target first, and this because it would have to be a small to midsize vehicle. I would also include the Middle Class in the US. They seem to be more able to change with the price of gas and adapt and go smaller, carpool or take public transportation.
c. Why did you choose this method of customer segmentation? Be specific. This group seems to be the most impacted by the price of gas and would benefit the most from this vehicle to the market. Also it would impact the community in which if you look at the class of people that care the most for the environment it would be the middle class.
d. Who is the target market? Be specific. Use demographics, psychographics (lifestyle), etc to identify your customer. It is important to identify the characteristics of your target market–whatever is appropriate. Most marketers are able to specifically describe their target customer. For example, a 35-45 year old white collar male who lives in the suburbs with a wife and 1 child and makes $85,000 per year. When reading the explanation of the target market, one should be able to draw a picture in their mind of your customer. My target group would be the middle class. The family that both parents goes to work and the annually income is $70k annually. After work take the kids to soccer practice or taking the family to the beach or the park on the weekend.
e. What are your product’s benefits to the target market? The product saves a family an average of 300 per month on gas and also impacts the environment with pollution. This product would cut down on the use of fossil fuel usage.
f. At what price will your product be introduced? Why? The cars would be introduced at $30,000 for a car or $45 for the truck/suv. I would only sell this product for 5 years and patent the technology.
g. What new product pricing strategy are you using?
I would only sell the vehicle for 5 years and once the vehicle is received and approved by the public then I would use the patent to make the real money.
h. What objectives will be accomplished by using this strategy? Be specific. After 5 years you sell the company but not the patent but lease the technology to other car companies.
i. Why is the product worth this price?
No more oil spills in the oceans and cleaner on the environment. Also no more going to the gas station just go to the water hose in the front yard and fill up.
j. Identify and explain what prices you should charge at each stage of the PLC?I would charge during the introduction phase $30K/$45K +$10, this during my growth phase, the price I will then charge during the maturity phase will be $30K/$45K – $2, during the maturity phase the price charged will be $30K/$45K – $3, and during the decline phase the price charged will be $30K/$45K – $5. For the introduction phase the penetration strategy for my H2O run vehicle I will use for the growth stage my price would increase and this would be, because there would be no competition. In the maturity stage I would be lowered you are trying to beat the new competition and the declining stage I would lower prices to get more customer before selling the company.
University/College: University of Chicago
Type of paper: Thesis/Dissertation Chapter
Date: 17 November 2016
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