1. New to the world products : New products that creates an entirely new market.
2. New product lines : New products that allow a company to enter an established market for the first time.
3. Additions or existing product lines : New products that cement two companies established product line. (Package, sizes, flavours and so on).
4. Improvements and revisions of existing products : New products that provide performance or greater perceived value and replace existing products.
5. Repositioning : Existing products that are targeted to new markets or market segments.
6. Cost reductions : New products that provide simpler performance at lower cost.
A new product is one that is new in any way for the company concerned. A product can be new in many ways. A fresh idea can be turned into a new product. According to Federal Trade Commission FTC, to be called new, a product must be entirely new or changed in a functionally significant or substantial respect. (McCarhy and Perrault: 1987).
As indicated by an estimate, only 10% of all new products are truly innovative and new in the world. These products involves the greatest cost and risk because they are new to both company and the marketplace. Thus. most company's new product activity is devoted to improving existing products. At Sony for instance, over 80% of new product activity is undertaken to modify and improve existing Sony products.(Kolter, 2001).
