Factors which impact on food product development
Difference between a macro-environment and a micro-environment factors.
Macro-environment factors are external influences outside a company’s control, while micro-environment factors are internal factors within the company that can affect food product development.
Definition of a line extension?
A line extension is a new product added to an existing product line, using an established brand or product category. It may involve changes to flavour, size, variety, packaging or formulation.
The purpose of a design brief.
A design brief is a clear statement of the aims, requirements and criteria for developing a food product. It provides direction for the product development process and helps ensure the final product meets the needs of the target market.
Elements of a marketing plan.
The 4Ps of the Marketing mix
product planning
price structure
place and distribution system
promotional program
SWOT stands for...
Strengths, weaknesses, threats and opportunities
Microenvironment factors.
The internal company conditions:
Definition of a me-too food product and the purpose of its development.
A me-too product is a new product that is similar to an existing successful product, often with only minor differences. A company may develop one to compete with an established product, meet consumer demand and gain market share while reducing the risk and cost associated with developing a completely new product.
The importance of market research.
Market research helps identify consumer needs, preferences, trends and competitors, allowing a company to develop a product that is more likely to meet the needs of its target market and be commercially successful.
Stages of the product lifecycle.
The product life cycle is the process a product goes through from when it is first introduced into the market until it declines or is removed from the market. The life cycle has four stages
1. Introduction
2. Growth
3. Maturity
4. Decline
Internal factors in a SWOT analysis.
Strengths and weaknesses
The influence of the economic environment on the development of a new food product.
Changes in costs (materials, labour, energy), employment (consumer income and spending) and interest rates (borrowing and investment costs) can influence product pricing, ingredients, production methods and consumer demand.
Drivers of food product development.
Changes in consumer needs, preferences and lifestyles can create demand for new or modified food products. For example, longer working hours can increase demand for convenience foods, while an ageing population can increase demand for foods that meet specific nutritional or dietary needs.
The importance of developing product specifications and undertaking feasibility studies before making a prototype.
Product specifications identify the required characteristics and standards of the product; a feasibility study determines whether the product is practical, affordable and achievable to produce. Together, they help reduce the risk of developing a product that cannot be successfully manufactured or sold.
Types of distribution channels.
Direct selling involves the manufacturer or producer selling directly to the consumer.
Indirect selling involves one or more intermediaries, such as wholesalers and retailers, between the manufacturer or producer and the consumer.
A checklist of everything the product must achieve.
Product specifications - contain details relating to the: raw materials/ingredients list, physical qualities -
(size, weight, volume; colour, texture, flavour), nutrient content, microbial load, shelf-life, storage conditions, packing and labelling requirements
The effect of changes in the macroenvironment on food product development.
Reasons a company may develop a new-to-world product.
A company may develop a new-to-world product to create a new market, meet an unmet consumer need, respond to emerging trends or gain a competitive advantage. It generally involves greater cost and risk, but can provide opportunities for significant growth and increased market share.
The role of testing (sensory assessment, packaging tests and storage trials) in prototyping.
These tests provide information about whether the prototype meets its product specifications and consumer needs. Sensory evaluation assesses qualities such as taste, texture, aroma and appearance; consumer testing measures consumer acceptance; packaging tests assess protection, function and appeal; and storage trials determine shelf life, quality and stability over time.
Pricing strategies available to a manufacturer.
Pricing strategies
Penetration pricing: price is below competitor for long enough to gain a foothold in the market; used when entering the market.
Price skimming: sold at a high price at first then price falls over time; used when new to the world or long-life expectancy.
Competitive pricing: price set to match competitor, though used with other promotions.
Psychological pricing: influence customer perception (for example, $2.99, “low price”, “special”).
The importance of identifying weaknesses before developing a new food product.
It allows a company to address potential problems, such as limited finances, expertise, equipment or production capacity.
The effect of micro- and macroenvironment factors on food product development
Micro factors can affect a company’s skills, resources, finances, production capacity and reputation.
Macro factors can affect consumer demand, regulations, costs, sustainability and available technology.
Together, these factors can determine whether a product is feasible, developed successfully and profitable.
Considerations when choosing between a line extension, me too or new-to-world product
Market research data, consumer needs, competition, costs, risks and potential profitability.
The role of market research, feasibility studies, prototype development and product testing.
These stages help identify consumer needs, potential problems and production limitations. Market research identifies consumer preferences and market gaps; feasibility studies determine if the product is viable; prototype development allows for refinement; and product testing identifies issues with quality, safety, packaging, storage and consumer acceptance.
The purpose of a marketing plan.
Provides a framework for deciding how a new food product will be positioned, priced, distributed and promoted to its target market.
The role of a feasibility study.
To determine whether a proposed food product is practical, achievable and likely to be successful before significant resources are committed to development.
Studies include:
technical - assesses required materials and equipment against available resources
financial - assesses cost, including material and labour, and benefit such as profit margin and customer satisfaction
operational - assesses availability of resources, human and non-human to support the project