Product & Service Development Report: BTEC Unit 22 Assignment

This report delves into the processes involved in product and service development, focusing on L'Oreal Paris as a case study. The report begins by explaining the new product development (NPD) process, including idea generation, screening, concept development, business strategy analysis, product development, test marketing, and commercialization. It then applies this process to the development of L'Oreal's modified hair spa kit, which includes Vitamin B tablets. The report further assesses the product life cycle of L'Oreal's Luxe product line, specifically the hair spa kit, and evaluates product line management choices. It also covers the design and pitch of a product, taking into account market testing, product launch, and distribution. Finally, the report includes a reflective statement on team working, creative development, and presentation, providing a comprehensive overview of the product and service development journey.

Product & Service
Development

PART - A.........................................................................................................................................3
INTRODUCTION...........................................................................................................................3
P1. Explain the processes involved in the development of products and services and the levels
of customer integration................................................................................................................3
P2. Apply these processes in application to the development of a specific organisational
product or service.........................................................................................................................5
PART 2............................................................................................................................................6
INTRODUCTION...........................................................................................................................6
TASK 2............................................................................................................................................6
P3. Assess the life-cycle stage of the products or services in a company’s portfolio..................6
P4. Evaluate which appropriate product line management choices are required for individual
products or services......................................................................................................................8
P5. Design and pitch a product or service taking in to account market testing, product/service
launch and distribution...............................................................................................................10
TASK 4..........................................................................................................................................12
P6. Complete a reflective statement that critically reflects on team working, creative
development and presentation....................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

PART - A
INTRODUCTION
Modern business world is filled with competitors. Therefore, it has become vital for
companies to develop new products or services with the use of invention or innovative approach.
It is required for firms to understand the renews and measure needs of customers who have been
targeted. This may lead organizations to manufacture the best product or service. In present
report, company which has been chosen i.e. L`Oreal Paris which is a multinational French brand
which was found in the year of 1909. Company planned to re–launch its hair spa kit with
modifications in it (Vasantha and et. al., 2012). Here, they have added some tablets of Vitamin –
B which can help their clients to grow hair much more stronger and smoother in nature at the
same time. Assignment will include process of a new product development (NPD) and
application of it on a product.
TASK 1
P1. Explain the processes involved in the development of products and services and the levels of
customer integration
The process of development of products or services is referred as the stage where
particular company decides to establish and produce their own products or any kind of specific
services. Product and services are two different concept, but service is interlinked with the
product to some extent. Product means any item is being made for available to the sale. It can be
both tangible and intangible. Service can be a product, product cannot be a service. Service is a
kind of transaction when there is no existence of the physical product transferring from the seller
to the purchaser (Lee, Kao and Yang, 2014). The product of product and services is considered
as the cross functional framework which involves marketing, design and production process.
In context of L`Oreal Paris, process of new product development is the step by step
framework. L`Oreal Paris has decided to launch their new brand product (Modified hair spa kit).
It will helpful in strongering and smoothing the hairs of its clients. The foundation of process
starts with idea generation and end at the launch of the outcome or product.
This process is considered as a journey from the creative and innovative idea to actual
product. For L`Oreal Paris, the process of the new product development are as follow:
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Idea generation - This is the primary stage of the new product development of an existing
product of L`Oreal Paris. It starts with an idea generation from various sources such as market
research, SWOT analysis, customer’s feedback etc (Grönroos and Voima, 2013). An idea would
be creative, innovative and a common fact with the wide scope to sustain in the market. An idea
would be specific and creative and innovative etc.
Idea screening - This is the second stage of development of product or service of L`Oreal
Paris. Ideas are many finding the most suitable is the difficult tasks. It involves finding feasible
idea which will most appropriate results. There are many factors such as: competitive advantage,
present trend in the market, company’s strength, price factor, affordability etc.
Concept development & testing - This is the third stage of the product or service development.
An idea when passing the screening stage converts into the product concept for the testing
purpose. In this some target customer are taken into consideration for the testing scope and
reliability of the product (Jacobs, Chase and Lummus, 2014). Customer feedback is very
important for the further improvement and changes in existing hair spa kit. Post evaluation is
very important for the forwarding process of product or service development.
Business strategy analysis & development - In this stage, process of development of
products or services actually comes into the existence, when there is a final confirmation from
the R&D department of the L`Oreal Paris. In this, company decides what all sort of strategies
and marketing move will company follow to make demand of the product higher. It involves the
competition, target market, pricing strategies, advertisements and sales promotion etc.
Product development - Once all other stages and strategies has been approved, it is the stage
when the actual product comes into existence. It would be both tangible and intangible and
tangible products. This stage decides the production process of the actual product when it passes
through the multiple stages of the manufacturing, packaging and logistics (Bertoni, A., Bertoni,
M. and Isaksson, O., 2013).
Test marketing - Now a days, L`Oreal Paris and other organizations are using prototype
strategy instead of the concept theories to take customer feedback and advice by first few sample
products to customer to test and give their feedback, views and opinion etc. The makes the
product ready for the launch and commercialization.
Commercialization - This is the last stage of the product & service development process.
It reveals that actual products is ready for being launch in the market for the purchase. After
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marketing mix is now put to use. In this, L`Oreal Paris basically decides the market for the
launch of the product with modifications which further will decide whether product is feasible or
not. This is important for the company to decide this as soon as possible before loss or market
potential disadvantage.
P2. Apply these processes in application to the development of a specific organisational product
or service
L`Oreal Paris is going to launch its modified hair spa kit which is enclosed with Vitamin B
tablets that are strongly recommended for hair nowadays. It has been analysed that every single
product whether it is new or modified when an organisation launches it , company needs to set a
process through which launching of product or application of development can take place
(Hogan and Coote, 2014). it is also required forL`Oreal Paris to consider to keep its focus on
customer integration because people consists with a number of perception which can impact
upon whole process of the product. Here, it is being found that above discussed process can
easily help L`Oreal Paris to develop its hair kit taking help of research and collected data from
different perceptions of customers.
Idea generation, this is one of the crucial responsibility of L`Oreal Paris because their are ample
number of cosmetic companies that are doing business in all over world and they have good
number of unique products and services as well. Here, it has also been analysed that simple
modifications can help L`Oreal Paris to bring good changes in their hair spa tool kit and this may
easily aid them in giving good rivalry to its competitors. Apart from this, idea screening and
concept developing are two more major responsibilities of product development process which
can help L`Oreal Paris in choosing the right idea from many (Demirkan and Delen, 2013). After
that, it is required to set appropriate strategy so that effective modifications in existing product
(Hair spa kit) can be made. Away with this, after considering all the points, product development
can take place. Lastly, testing of modified or new product of L`Oreal Paris can take place where
it is assumed by company that modifications that company have brought in are being liked by
people or not with the help of commercializing the hair spa kit among targeted customers.
Conclusion
With the help of above mentioned report, it has been summarized that NPD processes can help
an organization in developing right product for correct consumers. This may help in bringing
effective modifications with in an existing product or may aid in building a new one. It is
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required for firms to focus on following whole process of NPD without leaving any step, because
from generating the idea to its screening and then from their to developing strategy, developing
product to its merchandising and more plays a crucial role in success of a product. This can help
firm in reaching to new heights.
PART 2
INTRODUCTION
Under this section of report, firm which has been chosen to further understand the
concept of NPD I.e.L`Oreal Paris. This subsection of report will keep its focus on product life
cycle and appropriate product line management choices which are required for individual
products or services of the company. Apart from this, Design and pitch a product or service
taking in to account market testing, product/service launch and distribution. Lastly, a reflective
statement is also enclosed under this assignment which will critically reflects on team working,
creative development and presentation.
TASK 2
P3. Assess the life-cycle stage of the products or services in a company’s portfolio
Product life cycle comprises different stages which are associated with various marketing
and managerial decisions (Spithoven, Vanhaverbeke and Roijakkers, 2013). Like a human every
product has life cycle. Products and services has to go through four primary stages: Introduction,
growth, maturity and decline.
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On the basis of above mentioned product portfolio of L`Oreal Paris, product line which is
being chosen i.e. L`Oreal Luxe product line has been chosen and from that as well hair spa kit
has been chosen for the modifications to make for betterment of customers in near future. The
product line is enclosed with a number of products like Color Pure Shampoo, conditioner,
nourisihing cream bath, detoxifying conditioner and so on.
All these stages have different characteristics for different business. L`Oreal Paris is
world's largest cosmetics company, is introducing a Modified hair spa kit. The following are
stages of life cycle of this product:
L`Oreal Paris which is a multinational French brand which was found in the year of
1909. An organisation is French personal care company which headquarter is situated in Clichy
Hauts de Seine with the registered office in Paris. It is the world largest cosmetic company and it
has developed various activities and functions in the field of concerning hair colour, skin care,
sun protection, perfume, make up, hair care and men's skincare.
Products of
L'Oreal
Make-up
Foundation
Eye Liner L'Oreal Lipstick Nail Print
Sales Sales are lower Sales are at peak
level
Sales are
increasing on
continuous basis
Sales are
decreasing
Cost per
customer
In this, cost per
customer is
higher
Cost per customer
is lower
Cost per customer
is higher
Cost per customer
is lowest
Financial Losses Profit are
increasing
Income is falling Profits are higher Investment has
not yet been
recovered
Customer base Adults are
purchasing such
products
Women, girls
who are above 25
age
Customer base
includes young
girls, adults and
women
Girls, college
students and
adults
Competitors There are only
few competitors
Significant rivals
are present and
There are large
number of
Competitors are
stabilising where
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are exist in the
market place.
some new entry
are come for
create issues for
respective
company.
competitors are
present in the
market who are
deliver lipstick
among customers.
new competitors
are not coming
for make issues.
Market growth In this, market
growth is higher
Market growth is
declining
High market
growth is
expected
Market is
saturating
Product strategy For this, company
develop focus on
quality of
products.
Loreal focus on
price and income
on which they
offered products
to their buyers.
They are adopt
premium pricing
strategy for
Lipsticks which
mainly used by
girls.
For this, they are
mainly target
young girls,
women.
P4. Evaluate product line management choices which are required for a particular products or
services
A product line can be defined as a set of products of respective company under a single
brand (Flint and Woodruff, 2014). Organisations used to sell their number of product lines under
under brand to attract minds of customers. In present context, L`Oreal Paris which is already
having grey number of products which they have already segmented them among a single brand
name I.e. L`Oreal Paris. When it comes to launch a whole new product or modifications within
an existing product, company have to decisions for the particular product and here it is Hair spa
kit to select the best product line and make appropriate choice with the help of management. In
present context, it is the responsibility of product line manager of the L ‘Oreal Paris, as this is the
person whose main role is to manage particular products for ensuring that selling of the same
would help in getting success as per expectations.
This retailer is mainly focuses on increasing profitability of business by selling existing
products and launch new one also in same marketplace. Product line managers associated with
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different departments that are operations, sales, marketing, production and more, have equal
responsibility to offer product as per demand of marketplace (Jacobs, Chase and Lummus, 2014).
Company has various product lines like L`oreal Luxe, Professional Products and Active
Cosmetics, Consumer Products and The Body Shop. Company can consider the option of
bringing modifications in any of these so as to meet the increasing demands of customers and
business associates all across the globe. Yet company has chosen The Body Shop product line as
it contains products related to hair care and body care which people generally take special care
of. It can be said that L`Oreal's Modified hair spa kit belongs to The Body Shop product line.
This can be said as the company has added some content of vitamin in the kit by way of
additional tablets so as to enhance the strength of hair of customers. Also, this hair care product
is introduced by company by bringing certain modifications in existing product so as to meet the
demands of clients and make their hair grow much more smoother in same time duration.
There are various product line management choices which are described as under:
 Product Line Expansion – It is the method which can be use of an established product
brand name for new item in the similar type of good category. The line extension arise
when an organisation introduce additional features and qualities in the same product. It
includes features, forms, colour, packages size and so more. Loreal Lipstick is one of the
best selling product because this will attracting large number of customers. This assist in
gaining higher growth and success level when they add some changes in this products.
 Product Line Reposition – It refers to the main change and modifications in positioning
for brand and products. For successfully reposition of goods, an organisation has to
change in target market place for understand nature of products. Sometime, this is major
challenge which assist in establishing strong brand position in the market place. For
example, make up foundation is that product which sales is lower in the introducing stage
but it will reach with high sales after make changes in the quality or add some features.
 Product Line Contraction – It can be said that product do remain active but in the
interest of the organisation which is desirable to drop them. Due to technological
improvement and some changes in customers tastes in time, products become outdated
and unproductive. When a product is dropped, then the turnover of the firm is mainly
affected so this will reduction in profitability and income level. For example, Loreal Eye
Liner sales is falling at continuous time period which directly impact on business
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operations. There are very few customers who are buying this product from an
organisation.
 Cost reduction – It is the procedure which can be used by an organisation to reduces
their costs and enhancing their profitability rate. It is depend upon company's services
and products, in which strategies are change as per the customer demand. Every decisions
in the product development process can affects business costs. For example, Nail Print is
the product which sales is lower as compared to other goods supplying to the customers.
It can be analysed that this specific products has lower price cost which reduces company
profitability and income level.
 Discontinuous innovations – it is causes paradigm shift in science and technology and
the market structure of the company. They are enter to the world along with variety of
products and develop to perform a functions and activities where no previous goods are
exist. For an organisation, discontinuous innovation disrupt the established routine and it
is necessary for them is to set certain capabilities and new behaviour patterns. It is
required for firm is to adopt strategies and policies which are helpful in reaching with
potential goals and targets effectively. This is necessary for company is to make
innovative products and services in proper manner. When company develop innovative
and quality focused goods of Loreal so they can easily gain attention of target buyers.
TASK 3
P5. Design and pitch a product or service taking in to account market testing, product/service
launch and distribution
In context of L`Oreal Paris, company have already developed an effective modified hair spa kit.
This new idea the best chance to succeed, L`Oreal Paris need to accurately test the market and
plan the launch accordingly. While company could shell out a lot of money to consultants or
marketing strategists, it is mandatory for can organisation to study the market by own, and this
do-it-yourself approach may be easier and cheaper than holding an expensive strategy . (Jaakkola
and Alexander, 2014).
Start With Friends and Family: The vast majority of market research starts with discussing the
idea for Company’s product or service with the people in Business life wo are close enough and
can suggest the best option for L`Oreal Paris. Conversation can be done informally, over a
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Business meeting or in the car, or it could consist of a more targeted brainstorming session,
trying to mine the best ideas to enhance the overall creation of the product i.e. Modifications in
hair spa kit. In general, L`Oreal Paris just want to get a feel for whether or not the idea is having
good opportunity of succeeding or not. Theoretically, the people in business life are going to be
the most positive about product which L`Oreal Paris is going to launch.
Small Scale Testing: Once L`Oreal Paris decides to move forward with the idea, company may
want to start market testing on a small scale. As L`Oreal Paris creating a physical product, have
prototypes made so that people can test it out and give actual feedback on its design and
functionality. Using all of this feedback to Company’s advantage. Don’t outright dismiss
criticism without considering it, and remember that if multiple testers have the same compliant,
it’s probably a problem worth solving.
At the same position, , company also want to move outside the sphere of relatable business
people friends and family. L`Oreal Paris want to start getting the opinions of people with whom
organisation don’t have a personal relationship. For this stage, L`Oreal Paris can have the people
in into the business and enlist number of people so that they may provide feedback their and
family to provide feedback, or company can use social media to recruit a list of volunteers.
Hopefully, by getting these unvarnished opinions, people can start to refine product of L`Oreal
Paris creation so that it’s suitable to be unveiled to the public at large.
Testing the Market Online : The Internet is a virtually limitless resource for testing the viability
of L`Oreal Paris idea, and this research can be done in a number of different ways. One of the
best places to start is with online forums that deal with topics that are related to modified hair spa
kit. Check out the most popular forums on the topic, paying close attention to the number of
members and the frequency of posts. These metrics will help L`Oreal Paris to active the forum is,
which will give L`Oreal Paris some idea of how much public interest there is in its product
(Wirtz. and et. al., 2013).
Additionally, online tools such as Google Insights, Google Trends and the Google Keyword
Planner will show L`Oreal Paris how often people are searching for specific terms, where those
customers are located and whether the topics are growing in popularity. To be sure, the data
provided by these tools won’t perfectly predict the success of L`Oreal Paris, but it can be
incredibly useful as Company may start to strategize the best ways to brand and market the
creation which has been done by the company (Cummings and Worley, 2014).
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If organisation want to get more specialized information, sites such as Quantcast and Market
Samurai can be invaluable resources. With Quantcast, L`Oreal Paris can get a demographic
breakdown of company’s potential customers. Once organisation find a website for Hair spa kite
that is similar, Quantcast can deliver a wide range of data about the visitors to that site,
including age, gender and income level. Understanding these metrics will help company in to
better launch and advertise idea of L`Oreal Paris Additionally, Market Samurai can tell that how
many customers are looking for the type of product or service that L`Oreal Paris offering, as well
as how likely they are to spend money on it (Yip, Phaal and Probert, 2014).
TASK 4
P6. Complete a reflective statement that critically reflects on team working, creative
development and presentation
As mentioned by Jaakkola and Alexander, (2014) distinguish groups from teams and the necessity for
a thorough understanding of this process for effective team leadership and management. Authors
have demonstrated effectiveness of a team's role in completing a task as per desired manner in a
company. Therefore, by developing team and allot work accordingly, aid managers of L'Oreal to
develop relationship among workers. This would help in improving efficiencies of business and
offer a high quality of services at marketplace.
It has been critically analysed that when workers work in team then collaboration among
them is developed in effective manner. Away with this, another author have mentioned that
adopting a critical stance by implying that the application of learning strategies by educational
establishments is simply gathering together a group of individuals and hoping for the best. Co-
operative learning is said to reinforce learning amongst group members through discussion and
powerful review. In order to achieve a goal it is essential that teams work cooperatively.
Furthermore, I have found that collaboration as the foundation of a healthy team and together
with effective communication is key to producing high quality results. Some of authors have also
suggested that working collaboratively requires a clear objective and opinion when decision
making. the aspect of shared responsibility in collaborative working.
CONCLUSION
From above mentioned report, it has been concluded that proper product development
process for a particular commodity can help in executing the idea into real products or services
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which has been made after considering needs and wants of the customer. Apart from this, it is
being also summarized that product life cycle needs to be made properly which can help in
making modifications in existing products or it can also aid in looking at the overall status of the
product from its launching to current position of the product. An effective product can help a
company in giving good rivalry to competitors and can also aid in enhancing both profit and
reputation at the same time.
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REFERENCES
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Wirtz, J. and et. al., 2013. Managing brands and customer engagement in online brand
communities. Journal of service Management. 24(3). pp.223-244.
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