The web can play a crucial role in new-product development, says Forrester
The web is helping retailers reduce their cost of sales, but manufacturers of consumers goods have yet to tap into the Internet’s potential to lower their costs by using data gathered on the web to inform product development, according to a new report by Forrester Research Inc. To improve each stage of product development, manufacturers will need to use the Internet to collect and leverage data from consumers, retailers and supply chain partners, says Forrester analyst Evie Black Dykema.
Currently, the product development process for finished consumer products can take 12 months, fails about 40% of the time, and breaks down at several stages, says Dykema. “Product developers often substitute instinct for information because there isn`t enough time or money for formal research,” she says.
Manufacturers trying to coordinate efforts of factories, product designers and developers around the world lose time through poor communication that slows the process. And dollars are wasted when brand managers don’t know which consumer segments to target until after launch, when ad budgets are already committed, she adds.
“Web-driven product development,” which Forrester defines as manufacturers, their partners and consumers using data to align product development efforts, could plug holes in the product pipeline, Dykema says. Opportunities include using consumer data to help direct product development earlier in the process, detecting retail sales trends to help manufacturers get ahead of consumer trends, and making sure that suppliers` constraints are factored into the product development process.
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