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10 Old Grimsbury Rd, Banbury OX16 3HG, UK

MINI REPORT- INNOVATION

Solution:

  1. Outlining Key Concepts

New product/service strategy for NESTLE Company( Good Food Good Life):

 A product’s strategy assists and supplements the overall marketing strategy. There are products which help in penetrating or developing new technologies whereas others are likely to steady current market offerings in terms of product value, product layout, method, and features. New product development word explains the whole process of launching a new product to market.

Companies strategies to develop and market new the product:

  1. Bringing up innovative ideas to reinvent new product/service areas outer your core product
  2. Product improvement and moderating.
  3. Acquiring companies, patents, license in the process of bringing up new product. 1)
  1. Simplify your direction:  innovator, follower, or inexpensive contributor.
  2. A product should be created with risk forbearance and market position.
  3. Make a clear corporate vision to product strategy and to annually budgets.
  4. Apply accurate rule, financial support in the process for developing new product strategy.
  • For eg. Apple Product disordering and innovation
  • Amazon Customer needs and relentless iteration/execution
  • Google Technology driven solutions to big problems

In long run only 10% of new product survives in market. This failures happens due to 2)

  • Wrong estimation of market size
  • Poor designing and functioning of product
  • Development costs go over budget
  • Do not fulfil need or want
  • Poor implementation of 4p’s

New product development process:

In order to run long in market or to have a sustainable growth, a brand has to launch new products/services in market. It involves different steps and complications faced by a company while developing the product. The new product development process is an organized way for all potential businesses and entrepreneurs that will assist them to come up with a customer-centred, high-quality product that has the best chance of doing well in the highly aggressive markets. In an effort to explain new product development process, many market experts believe that there exist 5 or 7 steps of new product development process but this number may can vary. 3)

  • Creation of Idea
  • Fencing the ideas
  • Trial and development of concept
  • Generation of marketing strategy
  • Business analysis
  • Establishment of Product
  • Trial of product in market
  • Commercialization

The new product adoption curve:

It shows a visual depiction of diverse class of people who are ready to try out new product eventually. Phases of curve don’t aim to whom a company should sell the product, but comparatively about how to aim portion of your best customers. Beyond your customer base, There will be people who make a purchase on early stage and those purchase your product afterwards.

The product adoption curve going through five phases: innovators, early adopters, early majority, late majority and laggards. All these phases have its own separate return and challenges a company need to deal with to certify market dispersion. 4)

The role of social media in the adoption of new products and services:

Social media plays a significant role in the digital conversion of businesses. Basis of social interactions and social actions has evolved by internet, which escort to the development of new forms of communication channels and platforms. Digitalisation constitute to the universally accelerated process of motorized version by companies and society as a result of automation. Lately social networks was the source to provide the information about company or brand but now businesses use social media in their marketing objective and policy to improve consumers participation, affiliation, correlation with customers and get helpful consumers’ insights.

Business-to-consumer (B2C) companies are benefitted by using social media in their business processes. It helped in successive digital transformation such as leveraging the sales, brand awareness, and customer engagement.

From a marketing and sales research viewpoint, social media is defined as “the technological component of the communication, transaction and relationship building functions of a business which leverages the network of customers and prospects to promote value co-creation”.

In modern era social media has been used by industrial buyer for building better relationships with sale executives and to research about competitive products. Due to Social media companies have great exposure to outer world which helps them in making their market plan and strategies accordingly. Because of digitalisation, customers are more aware and its difficult to sell products using old methods. For example, In a survey, 82% buyer claimed that social media content impacted  their purchase decision. As a result, these changes in consumer behaviour changes put high pressure on B2B salespeople and traditional sales companies and their methods.

References:

  1. John Carter 2021“Product Development Strategy” https://www.tcgen.com/product-development-strategy/
  2. Cooper, Robert G., Scott J. Edgett, and Elko J. Kleinschmidt. “Benchmarking Best NPD Practices, 1991.” Research-Technology Management 47, no. 6 (2004): 43.  Crawford, C. Merle. New Products Management. 5th ed. Chicago: Irwin,              https://www.referenceforbusiness.com/management/Mar-No/New-Product-Development.html#ixzz79dAr8x8G
  3. Moorman, Christine, and Anne S. Miner, 1998 “The Convergence of Planning and Execution: Improvisation in New Product Development.” Journal of Marketing 62, no. 3 (1998): 1–20.

    Read more: https://www.referenceforbusiness.com/management/Mar-No/New-Product-Development.html#ixzz79dBOA5ft
  4. Rogers, Everett M (1962). Diffusion of Innovations. Free Press of Glencoe, Macmillan Company.

5.Taylor, S. A. , Celuch, K. , & Goodwin, S. (2004). The importance of brand equity inconsumer loyalty. Journal of Product and Brand Management, 13(4), 217–227.

       6. Aaker, D. A. (1991). Managing brand equity. New York, NY: The Free Press.

7.Mascarenhus, O. A. , Kesavan, R. , & Bernacchi, M. (2006). Lasting consumer loyalty — A total customer experience approach. Journal of Consumer Marketing, 23(7), 397–405.

8.Datta, P. R. (2003). The determinants of brand loyalty. The Journal of American Academy of Business, Cambridge , 3(½), 138–144.

9.Kim, J. , Morris, J. D. , & Swait, J. (2008). Antecedents of true brand loyalty. Journal of Advertising, 3(2), 99–117.

10. Chapter 11: Consumer Behavior and the Anatomy of a Bran

11.Liyanage, U. P. (2003). A customer value typology: Beyond the functional emotional dichotomy. Sri Lankan Journal of Management, 8(3/4), 165.

12.Margot Bouwman, F. G. (2001). The mental world of brands. World Advertising Research Centre, U.K.

2.) Drawing  keymodels  of concepts:

Creation of ideaTo develop new product a company needs to generate various ideas by searching out customer needs or finding weaknesses in their existing product or looking out for competitors.
Fencing the idea Idea screening means choosing best idea out of several generated ideas. In this process we choose good ideas and let go poor ones. By choosing appropriate idea it helps in reducing development cost by investing in profitable ideas.
Trial and development of Concept –  Concept development Suppose a car manufacturer has developed an electric car. So the company can analyse how concept can influence customer needs.  Concept 1: a reasonable average priced and mid-size car designed for family purpose which can be drive locally. Concept 2: an average-priced sporty look condensed car attractive to young age singles and couples. Concept testing These concepts need to be tested with target group of customers. After revealing the concept to the group of target consumers, they will be asked to provide feedback to find out how it appeals to them and does it will create value to customer.    
Generation of Marketing strategy Based on the product concept, an initial marketing strategy being introduced for the new product to launch in market. In this a company forecast profits for several years, plan long term sales, build strategic schemes to enhance sales, organise a marketing mix strategy. .  
The Business analysisIn this a business analysis sales, profit prediction and cost of the new product to discover whether these factors satisfy the company’s strategies and objectives. If factors match the standard then it moved for further process of development. E.g. In order to analyse and estimate sales, the company goes through the sales history of similar products and conduct market surveys.  
CommercialisationAfter analysing all steps it’s time to make final decision about launching the new product. Company should measure all the consequences of launching or not launching the product At this point company expenses shoots up as to launch new product to market they may advertise, sales promote or other marketing efforts taken into account for successiveness of product. 1)    

Adoption Curve

Prime moverInnovators are the first people who come forward to make a purchase. They are people who love to try new things and of course they are best source of feedback. To achieve greater penetration developers use feedback to improve their product.2)  
Early AdoptersEarly adopters are more associated with long-term users. This user can provide a useful insight as to how to position the product. Innovators and early adopters provide useful feedback to alter product so it can be successful in late adopter market too.
Late MajorityIn this people are more conservative and less aware. Advantage is to have more transactional sale and lower expectations
Laggards At this stage buyers are very disbelieving of your product. It is important cover these people or else company will lose a great market share. 3)

Social Media:

Customer relationshipSocial media helps in building relationship for e.g. After analysing a Canadian company twitter account it was seen that company uses account to build relation with small businesses consumers and customers.
Value Creation and corporate creditabilitySocial media is a biggest source to create value and creditability for customers and sales executives. It provides quicker and more personalised communications between customer and vendor, which can improve corporate credibility and reinforce the relationships. 4)
Brand awarenessResearchers have found that social media impacts brand awareness. Example of fashion industry impacted by social media. By going through 1395 posts from look book it can be constitute that the addition of national brand and private fashion brands in the post increased the level of popularity brand awareness. 5)    
 Creation of knowledgeVarious types of mutual web tools can help significantly enhance internal and external knowledge of the company. Social media created a positive impact on sharing and creation of customer information and knowledge in the case of B2B companies.

References:

  1. Maximilian Claessens, 2015, “THE NEW PRODUCT DEVELOPMENT PROCESS” 24th June 2015 https://marketing-insider.eu/new-product-development-process/

2.     Beal, G. M . Information sources i n the decision making process: stages of adoption analyzed by adopter categories. Paper read at seminar on “Adopting New Products: The Influence of Individuals and Groups, ” New Yor k and Ann Arbor, November and December,

a.      1958.

  • Fischer, A.J.,Arnold, & Gibbs, M. (1996). Information and the speed of innovation adoption. American Journal of Agricultural Economics, 78, 1073-1082.
  • Agnihotri, R., Kothandaraman, P., Kashyap, R., & Singh, R. (2012). Bringing “social” into sales: The impact of salespeople’s social media use on service behaviors and value creation. Journal of Personal Selling and Sales Management, 32(3), 333–348. https://doi.org/10.2753/PSS0885-3134320304.
  • AlSharji, A., Ahmad, S. Z., & Bakar, A. R. A. (2018). Understanding social media adoption in SMEs. Journal of Entrepreneurship in Emerging Economies, 10(2), 302–328.
  • Helen Keller International, Bangladesh . (2001). The nutritional surveillance project in Bangladesh in 1999. Towards the goals of the 1990 worlds summit for children. Dhaka: Helen Keller International.
  • Oski, F. A. , Honig, A. S. , Helu, B. , & Howanitz, P. (1983). Effect of iron therapy on behavior performance in nonanemic, iron-deficient infants. Pediatrics, 71, 877–880.
  • Walter, T. (1989). Mental and motor development. American Journal of Clinical Nutrition, 50, 655–666.
  • Watkins, W. E. , & Pollitt, E. (1997). Iron deficiency and cognition among school age children. In Grantham-McGregor, S. M. (Ed.). Nutrition, health, and child development: research advances and policy recommendations (pp. 179–197). Washington, DC: Pan American Health Organization, The World Bank and Tropical Medicine Research Unit.

3. Identifying company examples of innovative companies and how they deal with new product/service development

Snapchat

Snapchat bring back photo sharing activity in present era and revive back interest in shooting photos and communicating through photos. It flourished because it included social component and various ways to edit the picture which people found very enjoyable. Its features of clicking professional pictures influence the audience towards made it enjoyable for their audience. They also brought the photo-sharing idea into the digital age and made it interactive.

GoPro

GoPro re-introduced successfully an aged product which generally everyone has and made a destiny. GoPro is a good-quality camera. Conversely, they have made the camera attractive to people and eye catching too. It targets a large segment of thrilled customers and generate a kind of consumer base for themselves. GoPro attractive those customers which can give company a big business.

 Netflix

Netflix brand cleverly take up the opportunity and innovated the service which brings success to it. It is the home entertainment industry. They streaming services of films and television series attracted huge base of customer. It offers subscription based video on demand. They even have their production line where they produce almost 40% of programmes.

  Adidas

A sportswear brand gained popularity in a way that people in their spare time like to wear sport dress due to its comfort and design. NHL Pittsburgh Penguins star Sidney Crosby, and NFL Green Bay Packers quarterback Aaron Rodgers helped put Adidas back to the start. We required to not just having athletes but the best athletes.”As Adidas says, “Americans like winners.

Google 

Google new product development strategies are technology driven. Google  has its own way to resolve problems easily. It ensures to deliver a much better online experience to its user. For example

   –It changed the Advertising world with Adwords.

  • And also impacting the mobile, car, utility, etc. Industries

Whatsapp

It established the personal communications market. It is highly user oriented as it provides easy to use chat, voice call and video call system with end to end encrypted backups. It has more than two billion user.

Nintendo

Pokemon Go is the biggest example of how Nintendo gain its popularity again by just reinventing itself to develop a modern game which attracted all age group audience. Pokemon Go includes practical reality elements, gamification, and commerce with such accuracy can not find earlier. One the reason for the success was well-executed timing. 

Nestle

Nestlé is one of the business examples who brought innovation to businesses. Nestle worldwide covers 189 countries and provide employment to employing 339,000 people Nestlé Company has invested in modernization campaigns which helps in dealing with logistic barriers and advantage over competitors. Nestlé has adopted a two-divided approach to drive growth via internal and external innovation. In 2014, the industry massive used Qmarkets innovation software to initiate the ‘InGenius’ global innovation accelerator – It facilitate Nestlé employees to collaborate and provide solutions for business challenges, without any hindrance  being hindered by geographical or language barriers.

References:

  1. Brassington, F and Pettitt, S, (2000), Principles of Marketing, Second Edition, Prentice Hall, Harlow
  2. Brooks, I and Weatherston, J. (1997) The Business Environment. Challenges and Changes, Prentice Hall.
  3. Ali, H. , & Talwar, V. (2013). Principles of marketing (page 18). University of London International Programmes in Economics, Management, Finance and the Social Sciences, London School of Economics and Political Science (LSE). Retrieved from http://studylib.net/doc/8082686/principles-of-marketing—university-of-london-international
  4. American Marketing Association . (2013). Retrieved from https://www.ama.org/AboutAMA/Pages/Definition-of-Marketing.aspx2007. and was approved in July 2013.
  5. American Marketing Association 1985 . (1985). The definition of marketing. Marketing News
  6. nternational Labour Organization (ILO) . (1998). The social impact of the Asian financial crisis. Regional Office for Asia and the Pacific of the International Labour Organization, Bangkok.
  7. Tan, C. H. , & Santhapparaj, A. S. (2007). International skilled migration into Malaysia with special reference to their well being and sense of identity. Paper presented at the Institute of Social Studies, The Netherlands, August 30, 31.
  8. Adam, R. (2003). International migration, remittance and the brain drain: A study of 24 labor exporting countries. World Bank Policy Research Working Paper No. 3069.
  9. Retrieved from http://www.deborahswallow.com/2009/08/20/cross-cultural-marketing-blunders/. Accessed on October 17, 2011.
  10. Retrieved from http://en.wikipedia.org/wiki/Alfa_Romeo_164. Accessed on October 17, 2011.
  11. Retrieved from http://www.geert-hofstede.com/hofstede_dimensions.php. Accessed on October 17, 2011.
  12. International Herald Tribune , November 9–10, 1991.
  13. Hofstede, G. (2001). Culture’s consequences: Comparing values, behaviors, institutions and organizations across nations. Thousand Oaks, CA: Sage.
  14. Taylor, S. A. , Celuch, K. , & Goodwin, S. (2004). The importance of brand equity in consumer loyalty. Journal of Product and Brand Management, 13(4), 217–227.
  15. Aaker, D. A. (1991). Managing brand equity. New York, NY: The Free Press.
  16. Mascarenhus, O. A. , Kesavan, R. , & Bernacchi, M. (2006). Lasting consumer loyalty — A total customer experience approach. Journal of Consumer Marketing, 23(7), 397–405.
  17. Datta, P. R. (2003). The determinants of brand loyalty. The Journal of American Academy of Business, Cambridge , 3(½), 138–144.
  18. Kim, J. , Morris, J. D. , & Swait, J. (2008). Antecedents of true brand loyalty. Journal of Advertising, 3(2), 99–117.
  19. Chapter 11: Consumer Behavior and the Anatomy of a Brand
  20. Liyanage, U. P. (2003). A customer value typology: Beyond the functional emotional dichotomy. Sri Lankan Journal of Management, 8(3/4), 165.
  21. Margot Bouwman, F. G. (2001). The mental world of brands. World Advertising Research Centre, U.K.
  22. Liyanage, U. P. (1997). From commodities to brands: A process perspective. Sri Lankan Journal

Section 4. How these concepts can boost revenue and provide them with a competitive advantage.

Conclusion:

  1. Nestle global vision is to be visualised as leading nutritional, wellness and health company. Nestle mission is to positively enhance the value of people life through their product brand.
  2. Nestle work environment is employee oriented which encourages employee to work hard. One of the weakness of Nestle company, it is entering to already mature market which will give high competition to new products entry. Nestle introduced more than 2000 brands globally. In 1860 Nestle has introduced their first product line. Nestle successfully builds its brand name and holds a great market share. It always focused on financial stability which brings long term growth. It has always given priority to shareholder value.
  3. In order to sustain success in the market a product development process should focus on creating superior customer value. The risk and cost are the barriers in succession of any product. A very few product pass the every stage of new product development process. For example : Nestle used two approaches to introduce its new product( CERALAC) to market – Market penetration and product development. They develop a product in infant food line and created value to consumers.
  4. From our project it can be concluded that to become the market leader the product must be unique and should provide value proposition to the consumer.
  5. The main and unique feature of new product that has never been introduced helps in achieving competitive advantage. Like Nestle introduced into dips segment the magi dip and spread. It helps them to compete with brand who offers dips food product line.
  6. New product development is the best way to stay ahead in generating high revenue and continue to fulfil the ever changing needs and demand of customers. Besides it helps in opening the new marketing channels and helps to hold a large market share which inculcates high revenue to company.
  7. The strategies which are explained above fully satisfy the successive approach towards developing new product. Like Maggie masala gained popularity as arrived.
  8. Implementation of adoption curve process with stages has helped businesses to focus on their new product investment on the most profitable projects.
  9. It has cut down the time between idea and revenue by organising the difficult set of activities necessary for the industrial success of new product.
  10. Social media provide unbeatable platform for consumer engagement. New phases of  challenges as a form of marketing provided by social media. It supports knowledge consumption and knowledge construction.
  11. Social media impacts revenue by letting people know what your business offers and how it can add value to their lives which also helps in creating brand awareness and achieving competitive advantage.
  12. By Social media it gives advantage of maximizing return on brand building investment and provides a highly occupied customer base. Advertising through social media impacted the Nestle brand positioning. It offers high customer base build their brand loyalty.
  13. SWOT ANALYSIS OF NESTLE BRAND

Strengths: Brand name is very well recognized and respected all over the world. So launching new products will provide large customer base without using much marketing tools.

Weaknesses: Entering to matured market can put Nestle into difficulties.

Opportunities: Nestle has great opportunities to expand their business in countries like UAE,USA, INDIA.

Threats: Competitors create threats like OLPERS gaining popularity nationally and internationally.

References:

  1. Aerk, D. A. (2009). Brand portfolio strategy: Creating relevance, differentiation, energy, leverage, and clarity.
  2. Campbell, P. (2015). Pestle analysis in a day. CreateSpace Independent Publishing Platform.
  3. Consultancy.uk. (2015, August 17). 50 largest consumer goods / FMCG firms of the globe. Retrieved from https://www.consultancy.uk/news/2453/50-largest-consumer-goods-fmcg-firms-of-the-globe
  4. Fleisher, C. S., & Bensoussan, B. E. (2015). Business and competitive analysis: Effective application of new and classic methods.
  5. Immonen, A., & Saaksvuori, A. (2008). Product lifecycle management.
  6. Pride, W. M., Ferrell, O. C., Lukas, B. A., Schembri, S., & Niininen, O. (2015). Marketing principles.
  7. Pruschkowski, M. (2018). The BCG matrix and its support of management decision making.
  8. Statista. (2018). Nestlé: sales worldwide by product category, 2017 | Statistic. Retrieved from https://www.statista.com/statistics/413559/global-sales-of-nestle-by-product-category/
  9. Statista. (2018). Nestlé: sales worldwide by product category, 2017 | Statistic. Retrieved from https://www.statista.com/statistics/413559/global-sales-of-nestle-by-product-category/


 

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