In the world of technology, people expect new products from market that makes their life easier and reliable. But the thing is most products can’t able to manage their name through certain period and they disappear from the market. Most of the new items fail to convey any important income in return. According to a study conducted in the United States of America, only 10%- 20% of the new products/ services released in the market do succeed. In simple terms, 80%-90% of the new products released in the market, irrespective of their industry of origin, fail to meet the marketers’ expectations (Adams, 2004, p. 67).
This was the case of the Ford Thunderbird model which failed only four years after it was launched into the market. The new model holds the capacity to a model halt and is in this manner in a very much characterized sense a change over the first. When it comes to automobile cars, disappointment can be measured in different ways: Sales, observation, customer dissatisfaction and attractive quality are however also the loss of life. However, when a car model fails, it’s once in a while in a tremendous burst of glory, as a result it disappears from the market. In such cases, various reasons may be there for failure. I have chosen the Ford Thunderbird model as a case study to investigate why new products fail to stand in today’s market.
When marketers release products in the market, it’s their wish that the product will thrive and become competitive. No one wishes their products to fail. However, success is not always the case. A study conducted in the U.S. established that only 10% to 20% of the new products/ services realised in the market succeed. This means that approximately 80% of the new products fail (Adams, 2004, p. 67).
Over years, most promising products that were expected to have a promising future failed terribly. While a few failed several years after entering the market, a thousand others failed even before being released into the market. Some products were over advertised and failed to match consumers’ expectations. Other products were dropped into the market at the wrong time while others were poorly marketed and dropped quickly for the consumers. Even though these reasons can be regarded as assumptions, this study aims at establishing the real factors that lead to failure of the Ford Thunderbird model to win the hearts of consumers in the market.
It should be understood that the Ford Thunderbird model failed only four years after it was launched in the market. The study seeks to establish the real factors that might have led to the failure of this car model by Ford (American_Choices, 2015, p. 45). Further by investigating the factors that lead to the failure of the Ford Thunderbird model in the market, the study will examine how the Ford Company was impacted financially and economically. This problem statement fully fits the research study.
The main aim of this study is to analyse the main cause of the failure of the Ford Thunderbird model to stand out in the market after their launch and how such failures affect the respective company and marketers. More specifically this study aims at meeting the following objectives and answer the following questions as well.
Research Objectives
Research Questions
These set of questions will answer the research topic and its objectives as specific as possible.
This research topic is easily justifiable. Heavy investment in market research and advertisement by companies leads to the tremendous success of products and services. In the same manner, some products/ services suffer miserable failures even after companies have incurred a cost to launch them. Such scenarios bring financial and economic burdens to companies. Some companies rely on the success of competitors’ products to release substitute products in the market. Such products fail terribly when they fail to capture the customers’ attention. For example, the Microsoft launched its Zune product following the success of Apple. Zune failed because of technical problems; it failed to match the Apple and the customers’ preferences (Ulrich & Eppinger, 2011, p. 71).
Some of the products that failed after stand out in the market after they were launched are;
These are practical examples showing some of the promising products that failed a few years after being launched. Their failure cannot be a mere confidence. There must be a reason why this product failed. At this point, the research study is justifiable. The research seeks to establish what led to the failure of the Ford Thunderbird model. The findings will be used by marketers, companies and other stakeholders to address future attempt to relaunch the product as well as new ones. Lastly, Ford’s Thunderbird model has been chosen as a case study because its failure attracts a lot of attention globally.
The study expects to establish the real factors that lead to the failure of new products in the market. Such factors will be obtained by consulting with the players in the automobiles industry, marketing experts and representatives from the Ford Company. Likewise, the impact of this failure to the company will be established as well. The impact will be listed in terms of economic and financial effect. The research output will be important to future scholars (as literature review), as well as assisting marketers/ companies who are looking forward to launching new products in the future.
Previous studies, scholars and available literature from marketing experts have established several factors that led to the failure of products in the market. While many people have assumed that failure marketing can be associated with bad timing, bad luck, and bad marketing. This section discusses several factors that led to the failure of new products in the market. Below are some factors that have been associated with product failure.
Some marketers consider beginning of a recession as the best time to release products in the market. This is the case of luxurious products which are mainly launched at the beginning of the recession. A good example is the Ford Edsel which was launched at the beginning of the 1958’s recession. Although the marketing strategy was perfect, the market was not ready for this luxurious car (Bonabeau, et al., 2008, p. 51). The product was “ahead of time”. It belonged to the future and its market did not exist at that moment. Today Ford Edsel is considered to be a marketing catastrophe. Another example is the Apples PDA device which was overrated. Nobody was ready to pay US$700 for this product. This product failed as well (Schroeder, 2017, p. 888).
Some products might undergo hyped-up marketing which feels consumers feel as if they have been tricked. Such products fail to meet the customers’ expectation. This is another reason why Ford Edsel failed. The automobile had been positioned as an edge cutting product. However, the public viewed it as a new product with same attributes as the ones in the market but offered at a higher price. Ford suffered a cost of $350 million dollars in 1959 because of poor positioning (Cooper & Edgett, 2008, p. 99).
McDonald also suffered the same consequence as well in the 1990s when it released a new menu known as Arch Deluxe. MacDonald slapped tomato on top of its burger and positioned it as a fine dining menu. Consumers discovered the trick hence the positioning did not work for the Company. The product failed even after McDonald spent over $100 million on advertising it. Another product that can be grouped under this category is the Window Vista (Simester, 2016, p. 35).
Sometimes companies tend to resolve non-existing problems. Likewise, an attempt to improve an existing product can backfire. This would lead to losing the existing loyal customers. A good example is an attempt by Coca-Cola to replace the Coke drink with New Coke brand in 1985. Although the product was doing well, the company felt like PepsiCo was taking up its market share. Coca-Cola spent approximately $4 million on a marketing research which established that consumers wanted a new taste. However, consumers rejected the New Coke and demanded the original taste. Coca-Cola ended up confusing its customers instead of meeting their needs. The “New Coke” product failed terribly (Castellion, 2012, p. 45).
The success of a product depends on understanding why or what makes customers buy. A marketer should understand in detail the problem that customers need to solve and the amount they are willing to pay to solve the problem. Sometimes marketers create products before gathering and conducting a detailed analysis on the intended customers (Gordon, 2009, p. 121). For example, a product might meet the needs of only 5% of the market while failing to meet the needs of the remaining 95%. Such a product would definitely fail. Unless the needs of each consumer are not considered independently, the product will fail to stand in the market (Simester, 2016, p. 67).
Consumers want to buy value. They can only spend their time and money on products or services with the value proposition. For example, companies should provide a clear map how each player within a value chain is going to benefit from the product. If the value proposition is not in existence then the product will fail in no time (Ernst, 2002, p. 89).
Conclusion
The literature has shown that new products fail to stand in the market because of a number of reasons mentioned above. This means that such products fail to deliver the required financial returns. The range of poor products, lack of market fit, failure to analyze and understand the consumer needs as well as poor value proposition among others. The literature is in support of the research topic/ question/ and objectives (Grayson, 2006, p. 131).
The review has established that there are several factors that contribute to product failure. This is the basis of establishing what led to the failure of the Ford Thunderbird model. Ford has invented the car Thunderbird in the early 2000s which were introducing time of style and luxurious cars in the market. Ford tried to invent the card that suits other cars such as Mini Cooper and VW Beetle, but the car has faced the engine problems leading the car disliked by many people and subsequent withdrawal from the market by the Ford Company.
Figure 1 shows several factors that have been established to contribute to the failure of new products. The factors are the independent variables for the research while the Dependent variable would be the new products failure in the market. The independent variable will be evaluated to achieve the research objectives.
Based on the problem statement and the research objectives, the following research hypotheses have been proposed to be tested in the study:
H (1): Null Hypothesis: There are factors that lead to the failure of the new product to stand in the market.
H (2): Alternate Hypothesis: There are no factors that lead to the failure of the new product to stand in the market.
To achieve the research objective, the following methodologies will be used. They are:
First, the research will rely on secondary sources of data for in-depth analysis. The information will be obtained from different sources such as peer-reviewed journal articles, Google scholars, and previous studies from other scholars. Detailed analysis of these secondary sources will be evaluated to establish the factors that contribute to the failure of new products.
The second sources of data collection will be Questionnaire and interviews. Questionnaires will be prepared and handled out to marketing experts, Ford Company’s sales and marketing department and Automobile consumers. The questionnaire will comprise of both structured and unstructured questions which will be used to obtain the respondent’s opinion on the research topic. Direct interview with selected participants will be conducted as well when there is the need for further clarification on their answers captured in the completed questionnaire. For example, an interview with the Ford representatives will focus on the financial and economic effects of the products’ failure. The researcher would seek to obtain the sales report before and after the release and withdrawal of the Ford Thunderbird model from the market. The research will examine the report to establish whether or not there was a reduction of annual sales by the Company as well as the consumers’ perception about the model.
Both the quantitative and qualitative data analysis techniques will be used to analyse the collected data. Quantitative analysis will analyse the financial and mathematical figures collected using the questionnaire, the interviews and online surveys and forums. The descriptive statistics techniques like Standard deviation, distribution, mean and median will be applied.
The findings from the quantitative analysis will be supported by the findings qualitative analysis. This technique will be used to establish the key views of experts on the factors that lead to the failure of new products in the market.
A combination of the two data analysis techniques will ensure those accurate findings have been obtained as identified under the statement of the problems and the literature review. Through the analysis of the collected data, the study will establish the actual factors that led to the failure of the Ford Thunderbird model. The findings will be categorized into two. First, factors that contribute to the failure of new products to stand in the market. And two, how these factors affect the company economically and financially. Quantitative data will be presented using pie charts, tables, graphs among others presentation methods deemed fit by the researcher.
Section III
The study will be organised into the following chapters:
Chapter One: Which outlines the research Proposal, Introduction, Problem Statement, Research aim, objective, and questions and Research justification.
Chapter Two: will contain a detailed analysis of the case study i.e. the Ford Thunderbird Motors.
Chapter Three: will contain a detailed analysis of the review of the literature relevant to the research topic.
Chapter Four: Will comprise of detailed analysis of Research methodology.
Chapter Five: Will contain research findings and analysis.
Chapter Six: Consist of a detailed discussion of the research findings.
|
Item |
Start Day |
End Day |
Duration (in Days) |
|
Project Proposal |
20/ 04/ 2017 |
05/05/2017 |
15 |
|
Literature Review |
06/05/2017 |
17/07/2017 |
70 |
|
Data Collection |
18/ 07/ 2017 |
28/07/2017 |
80 |
|
Data Analysis |
29/07/2017 |
07/09/2017 |
40 |
|
Submission of the final report |
08/09/2017 |
08/10/2017 |
30 |
The research budget has been summarised as shown in the table below:
|
Item |
Estimated Cost |
|
Literature Review |
$ 1500 |
|
Data Collection |
$ 3000 |
|
Data Analysis |
$ 1500 |
|
Total Estimated Budget |
$ 6000 |
The total estimated cost of the study will be $6,000. The money will be spent between 20/04/2017 and 08/10/2017. The budget breakdown is as shown below:
References List
Adams, M., 2004. Findings from the PDMA Research Foundation CPAS Benchmarking, New York: PDMA.
American_Choices, 2015. Thunderbird – A Case Study in Success and Failure in the American Automobile Industry, New York: American_Choices.
Bonabeau, E., Bodick, N. & Armstrong, R., 2008. A More Rational Approach to New- Product. Harvard Business Review.
Castellion, G., 2012. Is the 80% product failure rate statistic actually true, New York: Wiley.
Cooper, R. & Edgett, S., 2008. Maximizing Productivity In Product Innovation. Research Technology Management, 51(2), pp. 47-58.
Ernst, H., 2002. Success Factors of New Product Development: A Review of the Empirical Literature. International Journal of Management Reviews, 4(1), pp. 1-40.
Gordon, M., 2009. The Path To Developing Successful New. Wall Street Journal, 23(8).
Grayson, R. A., 2006. THE UNDETECTED CAUSES FOR NEW PRODUCT FAILURE. Journal of Consumer Marketing, 1(3), pp. 53-59.
Henard, D. H. & Szymanski, D. M., 2001. Why Some New Products Are More Successful Than Others. journal of Marketing Research, 38(3), pp. 362-375.
Kandybin, A. & Michaels, A., 2013. “Successful Product Development: Unique, Coherent… And Rare. Forbes.
Schroeder, K., 2017. Why so many new products fail. The Business Journals.
Simester, D., 2016. Why Great New Products Fail. MIT Sloan Management Review.
Ulrich, K. & Eppinger, S. D., 2011. Product Design and Development. New Jersey: McGraw-Hill.
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