The term "new Product" may convey several meanings when it is viewed from the prospective of firms, market, customers and products.
1. Firm's Perspective
Firm perceives a product to be new if the firm is manufacturing it for the first time. firms often consider copies of a competitor's product as new.
2. Market Perspective
Form the view point of market, if the product has been introduced to the market for the first time it is a new product.
3. Customer Perspective
It suggests that newness of a product should be based on customer's perception. If a customer group feels that a product is new it should be treated as new.
4. Product perspective
From the product perspective a new product is viewed on its disruptive effects on the current consumption pattern. This classification is more relevant and strategically important in marketing. It categorized new product into three types- innovations, modified products and copies of me-too products
Innovations
Innovations are original products that are introduced to the human race for the first time. During the last half of the current century buyers have been bombarded with new innovations, such as computers, video-recorders, contraceptives, Polaroid cameras etc.
Many innovative products are introduced into the market every day. In the current decade alone the market has received several innovative products, such as the electric cars run by batteries, email and internet services, telephone-based on fiber optics etc.
Innovative products entail high costs and risks. Innovation involves considerable time as well as money. Currently, billions of dollars are being spent on the research to find cures for cancer and AIDS.
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Modification
Many organizations avoid innovation due to the high cost and risk factors and adopt a product modification strategy as long as possible. Modified product can be termed as a new product as it requires major change in the marketing mixes.
Product modification entails quality modification, functional modification and style modification
Copies or me-too products
Some organizations find the innovation and modification efforts too costly and risky. They adopt a product imitation strategy by copying and introducing successful products under a different brand name. Such products are introduced to capture a part of the market share of the original product. From the viewpoint of a market the imitated or me-too product may not be a new product, but from the organization's perspective it is a new product.
