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1 – 10 of over 44000Firms often use upward product line extensions to achieve gains in brand evaluations and in overall demand. Despite the prevalence of such extensions, previous research…
Abstract
Purpose
Firms often use upward product line extensions to achieve gains in brand evaluations and in overall demand. Despite the prevalence of such extensions, previous research has provided little guidance about how upward line extensions influence overall revenue when they are launched as a core product as opposed to a peripheral product. The purpose of this study is to fill this research gap.
Design/methodology/approach
Using data from the quick service restaurant industry, this study looks at the effects of upwardly extended core and peripheral products on product line revenue. The empirical study uses a quasi-experiment to compare customer purchases across the pre- and post-launch of upward line extensions.
Findings
The results of this study reveal that launching core and peripheral products as upward line extensions can each increase total product line revenue. In addition, findings illustrate that as compared to a core launch, this total product line revenue increase is substantially higher in the case of a peripheral launch.
Research limitations/implications
First, the estimated model does not include supply availability and competition. Second, the data span only six months and this restriction prohibits us from investigating alternative sources of the causal effect. Third, the empirical setting in this study is limited to financial data in the quick service restaurant industry as a proxy of actual behavior. Finally, given that customers are not randomly assigned to treatment and control groups, the author is unable to definitively rule out the effect of unobservable attributes.
Practical implications
The findings suggest that firms should prioritize peripheral upward line extensions but use both types considering resource constraints (cost and human resources) and strategic importance to the firm.
Originality/value
This study bolsters the extant literature related to upward product line extensions by providing an empirical framework that evaluates the causal effect of upward line extension on total revenue, using field data in a real-life setting (as opposed to survey or lab experiment data) and actual firm revenue (as opposed to a perceptual outcome measure such as behavioral intentions). In addition, findings contribute to the new product development literature.
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Farbod Fakhreddin, Pantea Foroudi and Mehdi Rasouli Ghahroudi
Based on the resource-based view and dynamic capabilities theory, this study aims to examine the complementarity between market orientations and launch proficiency as a…
Abstract
Purpose
Based on the resource-based view and dynamic capabilities theory, this study aims to examine the complementarity between market orientations and launch proficiency as a driver of new product performance.
Design/methodology/approach
In this research, an on-site survey of Iranian, research and development- intensive, manufacturing firms was carried out to examine the proposed hypotheses. Based on the 179 workable survey responses, a covariance-based structural equation modeling was applied to verify the proposed theoretical model.
Findings
The empirical findings reveal that the effects of market orientation or launch proficiency alone are not significant while the complementarity between them significantly influences new product performance. These research outcomes suggest that this complementarity leads to a bidirectional co-specialization relationship in firms, promoting both market intelligence generation processes and product-launch capabilities, and therefore resulting in superior new product performance.
Originality/value
The current characterization of the resource-based theory signifies that strategic resources merely have potential value and actualizing this value needs complementary organizational capabilities. Furthermore, the literature notably lacks empirical findings supporting these complementarities. Therefore, the findings concerning the bidirectional co-specialization between market orientation and launch proficiency not only provide empirical support for the dynamic capabilities theory but also address recent research calls to identify and calibrate the importance of dynamic capabilities for leveraging market orientation on new product performance.
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Peter Trim and Hao Pan
The purpose of this paper is to make explicit how marketers employed in the pharmaceutical sector can ensure that the company is positioned in the industry as a result of…
Abstract
Purpose
The purpose of this paper is to make explicit how marketers employed in the pharmaceutical sector can ensure that the company is positioned in the industry as a result of a sustainable competitive advantage being achieved. Various factors are highlighted, including high research and development costs, stringent government regulations and cultural factors such as religion.
Design/methodology/approach
The new product launch strategy model outlined in this paper was developed from both secondary and primary sources. A literature review was undertaken, a number of in‐depth personal interviews and a focus group session were conducted, which involved managers within a pharmaceutical company. The research strategy encompassed the case study method and the NPLS model was validated and can be viewed as generalisable.
Findings
It is clear from the research undertaken that some marketing models are viewed as being too complex; however, it is generally appreciated that marketing models can be used to interpret complex relationships that are evident in a marketing system.
Research limitations/implications
Two weaknesses associated with the model were identified. First, the assumption that there was a one‐way relationship between the strategic launch decisions and the tactical launch decisions and, second, a feedback mechanism was absent that would provide users of the model with a means for evaluating their decisions and identifying alternative strategies and tactics. The model was amended and a feedback mechanism was introduced.
Practical implications
The NPLS model can be used by marketing practitioners to enhance communication between corporate level staff and subsidiary level staff, and can be used to implement and/or facilitate the strategic marketing concept within a pharmaceutical company. The model can also be used to focus attention on risk reduction/elimination associated with market entry.
Originality/value
The NPLS model is an addition to marketing knowledge and can assist marketing academics and researchers to understand better how marketing models can be constructed and implemented. The model can also be used by marketing practitioners employed by pharmaceutical companies to make tactical and strategic decisions; to evaluate a new product launch strategy; and to devise international marketing entry plans and strategies.
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Ann Ledwith and Michele O'Dwyer
The importance of new product development to the survival and success of firms is well supported in the literature; however, few studies have investigated new product…
Abstract
Purpose
The importance of new product development to the survival and success of firms is well supported in the literature; however, few studies have investigated new product development in small to medium‐sized enterprises (SMEs). This study aims to examine the impact of product launch, product advantage and market orientation on new product development performance and organisational performance in SMEs.
Design/methodology/approach
This model was tested using data collected from 48 small and large sized firms in Ireland. Findings from 33 small and 15 large firms were compared, and a correlation analysis was used to establish the relationships defined in the model for both small and large firms.
Findings
The study identified several significant differences between the impact of product launch, product advantage and market orientation on new product development and organisational performance in small and large firms. It also indicated several areas in which small firms can improve their new product and organisational performance.
Research limitations/implications
This research builds on prior empirical research that has established a positive link between customer and competitor orientation and performance of small firms.
Practical/implications
The managerial implications suggest that managers need to place a greater emphasis on product launch proficiency, new product characteristics and market orientation.
Originality/value
The results show that a market orientation, as well as having a direct impact on organisational performance, also affects new product development activities.
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Tun-Chih Kou and Bruce C. Y. Lee
The purpose of this study is to fill the gaps in previous literature and investigate the link between product launch performance and supply chain architecture and…
Abstract
Purpose
The purpose of this study is to fill the gaps in previous literature and investigate the link between product launch performance and supply chain architecture and performance. During the past 20 years, most of the new product literature has focused on new product development and product innovation. Only a few product launches have been discussed in specific fields.
Design/methodology/approach
From the perspective of the manufacturer, interfunctional coordination, supply chain architecture and supply chain performance affect lean launch performance. Lean launches can also add value to product and marketing performance. A questionnaire was used to gather data from project, account and purchasing managers in the high-tech industry and to test the postulated research model and hypotheses. The conceptual model was tested using 242 usable questionnaires.
Findings
The results provide evidence that interfunctional coordination is the basis for improving supply chain architecture. The supply chain has a strong, positive effect on lean launch performance. Lean launch is vital to the successful performance of a new product. Although lean launch execution and supply chain performance affect marketing performance and new product performance, the direct effect on marketing performance is non-significant.
Originality/value
This study presents the characteristics of the supply chain architecture specific to the high-tech industry. The authors empirically tested and propose a model to explain how high-tech manufacturers build a solid supply chain and leverage the capabilities of suppliers to improve lean launch execution and new product performance.
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Susan Hart and Nikolaos Tzokas
This research examines whether the marketing mix decisions for new product launch change over the product‐market life cycle. Results raise questions about existing…
Abstract
This research examines whether the marketing mix decisions for new product launch change over the product‐market life cycle. Results raise questions about existing benchmark beliefs based on normative text‐book theories. In view of new insights we suggest a number of directions for the theoretical and empirical development of the new product launch field in the marketing management discipline.
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Erik Jan Hultink and Susan Hart
Focuses on product advantage, a major contributing factor to new product performance, by examining the launch strategies associated with high and low levels of product…
Abstract
Focuses on product advantage, a major contributing factor to new product performance, by examining the launch strategies associated with high and low levels of product advantage. Views a launch strategy as integrating protocol decisions, which have steered the course of a product’s development with the tactical marketing mix decisions. Data confirm all associations between key elements of new product protocol and product advantage. Growth‐related objectives guide the development of new products with high advantage, while the speedy development and early timing of the projects, the focus on growth markets, and the use of a niche targeting strategy are the hallmarks of products with high advantage. Contends that companies offering the world a better mousetrap do not believe the myth that a path to its door will be beaten; the better mousetrap requires and receives a different launch treatment from more pedestrian competitors.
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Minna Matikainen, Harri Terho, Petri Parvinen and Anne Juppo
This study examines the role and relative impact of market orientation, product orientation and relationship orientation on new product launch performance, investigating…
Abstract
Purpose
This study examines the role and relative impact of market orientation, product orientation and relationship orientation on new product launch performance, investigating product advantage and market-based assets as alternative mediating mechanisms, which link these strategic orientations to launch performance.
Design/methodology/approach
Survey data from the pharmaceutical industry are used to test hypotheses in the research model using partial least squares modeling.
Findings
Findings show that while each examined strategic orientation relates positively to launch performance, their performance effects and related mechanisms vary significantly. Results demonstrate a firm’s relationship orientation is the strongest predictor of launch performance, and accumulated market-based assets represent an alternative relational mediator besides product advantage linking firms’ orientations and launch performance.
Research limitations/implications
The empirical study is based on cross-sectional data collected in one specific industry sector. The authors encourage researchers to confirm the key findings in different industry and other contextual settings.
Practical implications
New product launch can be effectively managed as a relational activity. Firms benefit from paying explicit attention to strategic orientations and relationships. Especially, top management should foster a relationship-oriented organizational culture, develop relational competences and fully use the firm’s accumulated market-based assets for increased launch performance.
Originality/value
The study extends knowledge on the role of strategic orientations in launch performance by highlighting the significance of relationship orientations and providing novel knowledge on the key mediating mechanisms between strategic orientations and launch performance.
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Ana Garrido‐Rubio and Yolanda Polo‐Redondo
Innovation launch strategies are usually critical for innovation success. The main objective of this work consists of analysing the influence of the tactical launch…
Abstract
Purpose
Innovation launch strategies are usually critical for innovation success. The main objective of this work consists of analysing the influence of the tactical launch decisions on new product performance
Design/methodology/approach
Starts with a brief literature review. Then the results obtained in our study are compared with those obtained in other research. The data used in our research describes a new product launch in the Spanish agro‐food sector. The method for collecting the information was through a mailed questionnaire. Because most of response variables were categorical, and in order to verify the proposed hypotheses, cross tabulation was used. We used Pearson's chi‐squared (χ2), likelihood ratio (H2) and the adjusted residuals too.
Findings
The results propose a series of recommendations for the executives in charge of marketing new products. Specifically, suggests that it will be more likely to achieve success if, when launching a new product, skimming strategies are used, if intensive distribution is used for selling an innovation and the investment in the communication media is greater than that made by competitors. However, it is more possible to fail if the new product is marketed using an individual brand, penetration prices, push communication strategies and less expenditure on this concept than the competitors.
Research limitations/implications
The literature review suggests that some of these tactical decisions seem to be related with other launch decisions (strategic launch decisions). As a result of this, it will be interesting to perform these similar analyses for those as well as to analyse the possible links that may exist between both and their influence on the results. Future research could explore these relationships in other industrial sector or countries. Perhaps, it would be possible provide a common perspective.
Originality/value
In spite of the importance of the last phase of new product, there are few empirical works about it. This work tries to explain the transcendence of the tactical launch decisions and the influence of it on the success/failure of an innovation
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Min Zhang, Qiuping Huang, Xiande Zhao and Lijun Ma
In this study, we examine the implementation of purchase order finance (POF) which is an innovative supply chain finance (SCF) solution by an innovative SCF lender (i.e…
Abstract
Purpose
In this study, we examine the implementation of purchase order finance (POF) which is an innovative supply chain finance (SCF) solution by an innovative SCF lender (i.e. supply chain service provider (SCSP)). The effect of information integration between the SCSP (lender) and product designers (borrowers) on the lender's POF decisions and the borrowers' new product launch is investigated.
Design/methodology/approach
We conduct a case study in the Chinese smartphone industry. A mixed methods design is used, and data are collected from both the supply chain service provider (SCSP) and product designers. We first conduct a qualitative study. Hypotheses are developed concerning the relationships between information integration, in terms of social interaction and information system integration, POF and new product launch. We then conduct a quantitative study. The multilevel structural equation modelling method is used to test the hypotheses.
Findings
We find that information system integration is positively associated with POF but has no significant effect on new product launch. Social interaction is negatively associated with POF but positively associated with new product launch. POF is positively associated with new product launch.
Originality/value
This study contributes to the literature by empirically examining the implementation of POF from both the lender's and borrower's perspectives. We find that information system integration and social interaction have different effects on POF and new product launch. The results thus provide insights into how a lender makes POF decisions and reveal the benefits of POF for borrowers.
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