INFLUENCE OF NEW PRODUCT DEVELOPMENT ON PERFOMANCE OF SAFARICOM PHONE SERVICE PROVIDER, KISUMU, KENYA.
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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 States 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, Airtel and Yu for Kenya. The study investigated, the additional impact, new
product development brought to the performance of Safaricom. 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 Ms Excel. The findings of the study indicated that
promotion had most significant influence on performance of Safaricom, 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 Safaricom. 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.