Sharing some knowledge which I gathered from book " Entrepreneurship and small business".
As the name suggests, product planning means planning about product price, it's distribution and promotion. It is about identifying market requirement for the product specifications.
Product planning is a process of creating of idea and working on it till it gets physical state and gets distributed in markets.
Components of Product Planning and Management
1.) Developing product concept: First of all an idea is generated on the basis of problems a consumer is facing or what a consumer needs. After the product idea is generated, work begins on its features, specifications and dimensions.
2.) Market study: Proper study of market is done. Study is about competitors mainly, their market share of that product. Their share can be determined through their share in total sales of that product in a year. Then a business can determine places where it has an advantage over the competitors and identify place of opportunities.
3.) Market research: A small company should do both qualitative and quantitative research. Example of qualitative research is focus groups. Focus groups allow companies to ask their consumers about their likes and deslike about product. Phone survey is an example of qualitative research. Phone survey helps to cover more audience at one time.
4.) Product introduction: After idea is generated and research is done, it's time to introduce product in market and distribution needs to be done. A small scale industry is advised to start distribution in one or two cities first. In those cities, response is checked for the product. If results are favourable, company can start expansion.
5.) Product life cycle management: Product planning should also manage the product life cycle face. That is Introduction, growth, maturity and decline.
6.) Marketing: Last step is of marketing. It includes strategy to check targeted market, profitability and sales. It is mainly about study of consumer wants and needs, pricing policies, distribution, promotion and consumer satisfaction.