Influence of new product development on performance of Safaricom phone service provider, Kisumu, Kenya

Abstract

As the forces of global competition and consumer sophistication continue intensifying, business organizations are forced to rethink and redesign their strategies in order to meet the requirements of the changing market place. One of the strategies that could be adopted by organizations was new product development. This means an organization wide process aimed at bringing a new product or service into the market. It comprises a range of activities including idea generation, business analysis, market testing and commercialization.

In the mobile phone service sector, the adoption of new product development as a strategy has become popular with most global companies. For instance, in the United of America, the mobile telephone sector has registered remarkable growth as a result of new product development. This phenomenon saw Sony Ericson to beat the competition posed by American Telephone and Telegraph. In Europe, Nokia became the most profitable company as a result of product/service diversification. In Africa, the mobile phone service sector, comprised; Mobile telephone network and C cell companies for South Africa, Mobile telephone network for Uganda, Vodacom for Tanzania and Safaricom, Orange, Air tel, and Yu for Kenya.

The study investigated, the additional impact, new product development brought to the performance of Safari com. The purpose of the study was to investigate the influence of new product development on performance of Safaricom in Kisumu East District, Kenya. Objectives of this study assessed how new product innovation, pricing, placement, branding and promotion as components of new product development influence organizational performance. The study employed a descriptive survey research design that comprised a target population of 286 dealers. The sample size comprised the entire population (286). The data obtained was analyzed using descriptive statistics.

Data analysis techniques using statistical packages for social sciences (SPSS) was employed to produce frequency distributions and percentages, while tables were produced using Ms Excel. The findings of the study indicated that promotion had most significant influence on performance of Safari com, followed by pricing, placement, branding and innovation which recorded an insignificant influence. On the basis of these findings, the study concluded that promotion and pricing had the greatest influence on performance of Safari com. The study recommended that innovation, branding and placement be undertaken cautiously, while emphasis is put on promotion and pricing. The study suggested that further study be carried out on influence of new product development at different stages in the product life cycle.