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New products are critical to the growth and survival of most corporations. The new product strategy is the master plan that guides the product innovation efforts of the firm, and links new product development to the corporate plan. This article looks first at what a product innovation strategy is, its role in the corporation, and why an innovation strategy is essential to an effective new product program. Next, the article focuses on the development of a new product strategy, beginning with objectives and moving to arena selection. A matrix approach to arena definition and selection is used. Empirical data from research by the author is employed in the model to prioritize new product arenas.