Intensified Competition Drives Product Innovation in Food & Beverage Sector
Increased market competition directly pressures food and beverage companies to innovate their products, often by reducing costs and prices, to survive.
Preprints.org · 2020
Key Findings
- 01Competitive intensity has a significant positive impact on product innovation.
- 02Competitive advantage does not have a significant impact on product innovation.
- 03Product innovation does not have a significant impact on enterprise survival.
Application
Design takeaway
When designing new products or iterating on existing ones, consider the competitive landscape. If competition is high, focus on innovations that can lead to cost reductions and price competitiveness, as this is a proven driver for product development in such environments.
How to apply
When entering or operating in a highly competitive market, analyze the intensity of competition. If high, prioritize product development that allows for cost efficiencies and competitive pricing.
Project actions
- 01When researching a product, consider the competitive landscape and how it might influence design decisions.
- 02If your design project aims for survival, think about how it addresses market competition and potential cost pressures.
Method & Evidence
Variables
Strengths & Limitations
Strengths
- +Provides empirical evidence for the nexus between product innovation and enterprise survival.
- +Utilizes a robust statistical method (SEM) for analysis.
Limitations
This study focused on a specific industry and region, so the results might not apply everywhere. It also found that innovation didn't guarantee survival, which is an interesting point to explore further.
Reliability & validity
The use of SEM suggests a rigorous statistical approach, but the validity would depend on the quality of data and the appropriateness of the model specification. Reliability would be assessed through internal consistency measures of the constructs used.
Think critically
If product innovation doesn't directly lead to survival, what other factors are more critical for enterprise longevity in competitive markets?
Design Principles
"In highly competitive markets, product innovation efforts should be strategically aligned with cost-reduction and pricing strategies to ensure market responsiveness and potential survival."
Understanding the drivers of product innovation is critical for businesses aiming to maintain relevance and profitability. This research highlights that external market pressures, rather than internal competitive advantages alone, can be a significant catalyst for innovation, particularly in cost-sensitive sectors.
What This Means for Your Design
If lots of companies are competing, they'll try to make their products cheaper or better to sell more. But, just making new products doesn't always mean the company will stay in business, and having a good reputation doesn't automatically lead to new products.
How to use in your project
- 1.Reference this study when discussing the external factors that influence design decisions, particularly in competitive markets.
- 2.Use the findings to justify a design approach that emphasizes cost-effectiveness or price competitiveness.
Add to My Project
Quick Cite
(2020). Nexus between Product Innovation and Enterprise Survival: Impact of Competitive Intensity and Competitive Advantage. Preprints.org. https://doi.org/10.20944/preprints202005.0497.v1 Retrieved from https://designdex.org/study/3749d8e1-4331-4eb8-b9ea-e9260e75b671/intensified-competition-drives-product-innovation-in-food-beverage-sector
Paragraph starter
Research indicates that in sectors like food and beverages, heightened competitive intensity acts as a significant catalyst for product innovation, often driving a focus on cost reduction and competitive pricing strategies. While this pressure can spur development, the direct link between product innovation and enterprise survival, as well as the influence of pre-existing competitive advantages on innovation, may be less pronounced, suggesting a need for strategic alignment beyond just product development.
Source
Preprints.org
Nexus between Product Innovation and Enterprise Survival: Impact of Competitive Intensity and Competitive Advantage
journal · 2020
View sourceQuestions about this research
- What does the research say about intensified competition drives product innovation in food & beverage sector?
- When designing new products or iterating on existing ones, consider the competitive landscape. If competition is high, focus on innovations that can lead to cost reductions and price competitiveness, as this is a proven driver for product development in such environments. Evidence: Preprints.org (2020).
- Why does "Intensified Competition Drives Product Innovation in Food & Beverage Sector" matter for design?
- Understanding the drivers of product innovation is critical for businesses aiming to maintain relevance and profitability. This research highlights that external market pressures, rather than internal competitive advantages alone, can be a significant catalyst for innovation, particularly in cost-sensitive sectors.
- How can designers apply this research?
- When designing new products or iterating on existing ones, consider the competitive landscape. If competition is high, focus on innovations that can lead to cost reductions and price competitiveness, as this is a proven driver for product development in such environments.
- What were the main findings?
- Competitive intensity has a significant positive impact on product innovation.. Competitive advantage does not have a significant impact on product innovation.. Product innovation does not have a significant impact on enterprise survival.
- What research method was used?
- Explanatory and cross-sectional investigation using Structural Equation Modelling (SEM)..
- What should I do differently in my next project?
- When entering or operating in a highly competitive market, analyze the intensity of competition. If high, prioritize product development that allows for cost efficiencies and competitive pricing.
- What are the limitations?
- The study's findings may be specific to the food and beverage sector in Lagos, Nigeria, and may not generalize to other industries or geographical locations. The lack of a significant link between product innovation and survival warrants further investigation.
- Is there evidence that product innovation affects design outcomes?
- While intense competition pushes companies to innovate their products, this innovation doesn't directly guarantee survival in the studied sector, and existing competitive advantages don't necessarily spur innovation. Understanding the drivers of product innovation is critical for businesses aiming to maintain relevance Source: Preprints.org (2020).
- Where does this competitive research apply?
- Food and beverage industry in Lagos, Nigeria. It sits within innovation & design research on designdex.org.
Related research topics
product innovation design research · evidence on product innovation · does product innovation improve design outcomes · competitive studies for designers · product innovation and competitive findings · innovation & design research evidence