Why do new products fail

 A high-level executive pushes a favorite idea through in spite of negative market research findings

The idea is good, but the market size is overestimated

 The product is not well designed

The product is incorrectly positioned in the market, not advertised effectively, or overpriced

Development costs are higher than expected

Competitors fight back harder than expected. Several other factors hinder new-product development

Shortage of important ideas in certain areas:There may be few ways left to improve some basic products (such as steel, detergents)

Fragmented markets:Keen competition is leading to market fragmentation Companies have to aim their new products at smaller market segments, and this can mean lower sales and profits for each product

Social and governmental constraints:New products have to satisfy consumer safety and environmental concerns. Government requirements slow down innovation in drugs, toys, and some other industries

Costliness of the development process:A company typically has to generate many ideas to find just one worthy of development. Furthermore, the company often faces high R&D, manufacturing, and marketing costs

Capital shortages:Some companies with good ideas cannot raise the funds needed to research and launch them