Evaluate the importance to CQ's future success of new product development.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2023). The mark or mark type is shown in brackets.

1. [K] New product development is the design, creation and marketing of new goods and services.
2. [K] Research and development is the scientific research and technical development of new products and processes.
3. [K] Benefits of new product development: Attract repeat purchase by offering a product that is new and better; Meet customer needs more effectively; Attract new customers; Gain a competitive advantage over competition; Product differentiation; Control over pricing; Refresh the brand; Spreading risk.
4. [K] Disadvantages of NPD: Cost of product development; Need for market research; Risk of failure; Timescale.
5. [APP] Development of sustainable footwear which is comfortable.
6. [APP] Development of a product suitable for hot weather.
7. [APP] Link to mission statement.
8. [APP] Development of running shoe to challenge leading brands.
9. [APP] Improvements being made to products each year.
10. [APP] Reference to celebrity endorsement.
11. [APP] Process innovation involved in unique construction of the shoes.
12. [L2 AN] Improvements in product will maintain consumer interest in CQ's shoes and prevent the product becoming outdated. This will result in higher sales and potentially increased profit.
13. [AN] Celebrity endorsement attracted by the sustainability of the shoe helped build sales initially.
14. [AN] New product development can be expensive and is not guaranteed to be successful and therefore may constrain profits and result in solvency issues.
15. [L2 AN] Product development may contribute to CQ's image of high-quality and therefore support premium prices and give higher profit margins.
16. [EVAL] Without product development CQ will lose its competitive edge in the market. Products need to be continually improving to maintain consumer interest.
17. [EVAL] Fashions may change quickly in this industry and so it is important to constantly update products to satisfy consumers.
18. [EVAL] Product development was essential to initial success of CQ by producing a product that was different to that of the competition.
19. [EVAL] To challenge leading brands in the running shoe market may require significant product differentiation due to strength of brand image of existing firms.
20. [EVAL] Product development vs market development strategy for success.
21. [EVAL] Significance of current economic climate to the decision: Higher taxation may constrain finance available; NPD could develop cheaper range to counteract the economic constraints faced (higher taxation and inflation).
22. [EVAL] Other factors in success: Celebrity endorsement might be most important as marketing depended on social media initially. However, was this a direct result of CQ's successful product development?