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New product development and Danish meat industry firms Derek Baker Fødevareøkonomisk Institut (FOI) db@foi.dk 35 28 68

New product development and Danish meat industry firms Derek Baker Fødevareøkonomisk Institut (FOI) db@foi.dk 35 28 68 14. Background to NPD. Significance in the modern food industry choice and variety changing tastes competitiveness chain dominance

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New product development and Danish meat industry firms Derek Baker Fødevareøkonomisk Institut (FOI) db@foi.dk 35 28 68

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  1. New product development and Danish meat industry firms Derek Baker Fødevareøkonomisk Institut (FOI) db@foi.dk 35 28 68 14

  2. Background to NPD • Significance in the modern food industry • choice and variety • changing tastes • competitiveness • chain dominance • ”Innovation”,”New Product Development”, ”New Product Introduction” • Relations between and within firms • Measurement issues

  3. What is a ”new product”?

  4. Activities involved in NPD Source: Woods and Demiralay (1998).

  5. Attrition in NPD Source: Booz, Allen and Hamilton (1982).

  6. Accepted wisdom • Few products last a long time • Few products are ”truly new” • Faster and faster life cycles • Brand-related • Firm size-market interactions • Competition affects NPI • Within- vs. between-firm effects Unknown • innovation/NPD interface • VI, FDI, trade, brand profile, R&D

  7. Factors affecting NPI success Van der Panne et al. (2003)

  8. Current work • measure NPI and some NPD processes • explain them with attributes of the firm • relate this analysis to competitiveness • identify policy opportunities and problems Today • Measurement (by survey) • Focus on firms • Focus on meat industry

  9. Survey • 131 obs from 444 firms (30% response) • Interview format, 50 minutes with ”marketing manager”

  10. ”MEAT” 39 firms

  11. New products introduced and removed/firm, 2000 and 2005

  12. New products introduced/firm, 2000 and 2005

  13. Product life (firm averages), 2000 and 2005 Product removal age (firm averages), 2000 and 2005

  14. ”Newness” of new products: firm averages

  15. Type of brand used

  16. Brand portfolios: number of products per brand

  17. Branding policy for new products

  18. NPD cycle lengths: 2000 and 2005

  19. NPD phase lengths: 2005

  20. Change in NPD phase lengths: 2005 vs 2000

  21. Degree of NPD phase overlap more overlap no overlap/gaps

  22. Statements of branding strategy Non-Meat Meat

  23. Does this firm have a strategy on Research and Development?

  24. Barriers to new product introductions

  25. Barriers to new product introductions

  26. Barriers to new product introductions

  27. Barriers to new product introductions

  28. Barriers to new product introductions

  29. Model of NPI (all firms) Regression analysis of new products/firm (2005) Factors affecting NPI

  30. Summary • Meat sector’s NPI/firm is below that for non-meat • Meat firms retain products longer than non-meat firms • Brands matter, and meat has its own brand profile for existing and new products • NPD processes are different for meat/non-meat • Low attrition and a net increase in PI (meat and non-meat) • Around 30% of new products ”truly new” (meat and non-meat) • NPD process is getting slower (meat and non-meat), • NPD is not a common ”strategy” (meat and non-meat) • Few barriers to NPD recognised, although meat sector has its own policy and competitive concerns

  31. Questions • How to explain contradictions with existing knowledge: • speed? • attrition? • newness? • Would meat industry firms be helped by higher NPI? • How much does international competitiveness depend on NPI and innovation? • Is there a need for change in meat firms’ branding behaviour? • Are meat firms’ vertical structures adapted to NPI? • What can government do to help: • innovation-related? • other?

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