Innovation Management and New Product Development 6th Edition Chapter 13 PDF

Innovation Management and New Product Development 6th edition Chapter 13 Product and brand strategy Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Rese...

Innovation Management and New Product Development 6th edition Chapter 13 Product and brand strategy Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Capabilities, networks and platforms Company’s has to evaluate there core capabilities by evaluating the network of relationships within, or around, the firm. These relationships might cover customers, suppliers, distributors or other firms engaged in related activities. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Capabilities, networks and platforms Nowadays, networks are competing, rather than individual firms, thus the activities across the network need to be coordinated. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Capabilities, networks and platforms Choosing appropriate partners for the network and keeping them focused are important attributes for network leadership. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product platforms Product platform refers to ‘product family’, product family should be linked to product development strategy. Product platform may change based upon a set of factors such as: Changes in manufacturing technology, Customer need, and Competitors efforts offers, Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product platforms Using the product platform concept , companies try to differentiate all the components visible to the customer, while at the same time sharing components and production processes across product models Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product platforms The benefits gained through using product platforms are: 1.Reduced cost of production; 2.Shared components between models; 3.Reduced R&D lead times; 4.Reduced systemic complexity; 5.Better learning across projects; and 6.Improved ability to update products. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product planning 1.What product development projects will be undertaken? 2.What is the mix of the portfolio of projects such as new products, improving existing product etc? 3.What is the timing and sequence of the projects? Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product planning The planning process considers product development opportunities from many sources such as: 1.Marketing, 2.R&D, 3.Customers, and 4.Competitor analysis. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product planning Product development opportunities are usually classified into four types: 1.New product platforms. 2.Incremental improvements to existing products. 3.Fundamentally new products (discontinuous products). 4.Derivatives of existing platforms. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product strategy (Competitive strategy) Competitive strategy may drive new product planning on a short-term or long-term basis. A reactive strategy could involve filling out product lines with different product sizes or added features, by not leaving unattended small market segments to be used as an entry point by the new competitor. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product portfolios This approach was initiated by the share-growth matrix, or Boston box, which used market share and market growth as dimensions against which to plot the positions of products. https://www.youtube.com/watch?v=vNoI3yOE-os Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved The competitive environment The external environment could be related to: 1. Technology may change 2.Industry competitive structure may change 3.New regulations may appear 4.Customer needs may change Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Differentiation and positioning Levitt (1986) suggests that there are four levels on which products can be differentiated: 1. The core product comprises the essential basics needed to compete in a product market; a car needs wheels, transmission, engine and a rudimentary chassis. 2.The expected product adds in what customers have become accustomed to as normal in the product market; for a car this would be a reasonably comfortable interior and a range of accessories. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Differentiation and positioning Levitt (1986) suggests that there are four levels on which products can be differentiated: 3. The augmented product offers features, services or benefits that go beyond normal expectations. 4.The potential product would include all the features and services that could be predicted as beneficial to customers. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product positioning Product positioning refers to the perceptions customers have about the product’s position in the market relative to competitor products How customers discriminate between alternative products and it considers the factors customers use in making judgments or choices between products in the market being investigated. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Product performance criteria Source: Product Strategy and Management, Prentice Hall (Baker, M. and Hart, S. 1989), © Pearson Education Ltd. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Managing brands There has been substantial research on the subject of whether consumers are able to recognize brands that they buy frequently from fundamental attributes alone. The results reveal that from cigarettes to peanut butter and from cola to beer subjects are not capable of recognizing their usual brand. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Managing brands Given these findings one might ask why do consumers continue to pay a premium for particular brands when they cannot taste the difference Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Market introduction of brands Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Managing brands https://www.consumerreports.org/video/view/healthy-living/ food-nutrition/1846481147001/store-brands-vs-name-brands/ Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Figure 13.3 Branding system Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Brand strategy The branding strategy could be: No brand name at all, so that the product is sold as a commodity, Develop a unique brand name The product could be sold to another party for them to place their trademark or branding on it, Or major components, could be bought-in and then company-branded. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Brand strategy https://hbr.org/2015/06/a-better-way-to-map-brand-strategy Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved  Figure 13.4 Internal and external brand contacts Source: H. Rubinstein (1996) ‘Brand first management’, Journal of Marketing Management, Vol. 12, 269–80. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Brand extensions A brand extension is the use of an established brand name on a new product in the same product field or in a related field. The brand name might also be stretched to an unrelated product field. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved Withdrawing products Factors that could force the compnay to withdraw it’s products: 1.Poor sales performance 2.Possible future trends 3.The costs and benefits of continuing or withdrawing. Copyright © 2018, 2013, 2008 Pearson Education, Inc. All Rights Reserved