Latoya Cooper 0901132

Elan Case Study Firms survive through product innovation. How do firms identify and develop newproduct opportunities? 1. In order for a firm to survive it is crucial that they stay up to date with the consumers in order to provide for their needs. Survival chances of an organization increase when the growth rate of the company expands and the company also ages. Firms identify new opportunities by conducting market research and marketing analysis this enables them to identify niches and demands. Firms also have to generate ideas and design the product. Once these procedures have been completed organizations can then go ahead with the product. This is also evident from the Elan case study as in 1988, the company made a ski that would prevent skiers from falling over. This was a great idea as a high percent of skiers easily feel when usually usual skiing equipment. Having this innovative idea made other organizations copy Elans idea. As an industry evolves from birth to maturity, the number of firms initially rises and later falls. Eventually, only a small number of firms survive and the market becomes concentrated. This evolution pattern, termed as shakeout, is well documented for many industries (Gort and Klepper, 1982; Klepper and Graddy, 1990).

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What role does marketing play in new-product development?

The role marketing plays in new product development is a crucial one. As it will help distinguish if the product will be successful in the market. Marketing also enables companies to pin point each crucial part of the strategy for marketing new products. Firstly the main marketing concerns from all research and design departments are communicated for the new product design. Also they have to market strategically as to see whether they have targeted the correct consumer and market. Lastly, the research provides crucial information for the new product design team. For example, Brown and Eisenhardt (1995) summarized research on NPD success factors into three broad research streams, which can be roughly characterized as rational planning, communication webs, and disciplined problem solving. 2. As the new product ages, how should the firm adapt its marketing strategies in the face of changing tastes, technologies and competition? The firm should adapt its marketing strategies by firstly redefining the target market and the product positioning. The firm should also take into consideration how many sales the product has taken, its current market share and any forecasted profit goals for the product. In terms of changing tastes in regards to Elan they decided to start diversification. By creating other sports equipment although they didnt find success through this as many other competition companies have tried this and it has been successful for them. Also in this day and age technology is always developing therefore companies need to stay active and can easily compete with competiton as they can directly see what the competition is creating.