Introduction of a new product or technology
When new products, technologies, or services are about to be introduced into the market, more than customers’ preferences must be considered. The new product or technology will compete with existing ones, and other players’ reactions must be taken into account: Will competitors attempt to respond by lowering prices and sacrificing margins? How can we mitigate this risk and find a good positioning? Can we address a specific segment to keep competitive reactions to a minimum? Will other players block the innovation, or are there key groups (customers or other stakeholders) whose early adoption is key? The where’s, when’s, and how’s of an introduction are often critical due to competitors’ and other players’ reactions and should thus be considered thoroughly. Typically, there will be no second chance.
Straint’s approach to analyzing strategic interactions helps executives make the best fact-based decisions, taking upside potential and downside risk into account.
Selected cases: Introduction of a new product or technology
Growth strategy for an innovative drug
Portfolio/repositioning strategy for a drug at the end of its product lifecycle
In a large but saturated segment with many similar drugs/treatments (prescription), a competitor launched a new drug that was expected to quickly gain a great deal of market share. As a consequence, our client’s well-established, high-volume product in the second half of its lifecycle was seriously challenged. At the same time, their new product did not receive the approval of additional benefits from the authorities.
During the project, we helped our client develop a value-maximizing repositioning and partial pullback strategy by focusing our attention on specific patients.
New product positioning, marketing, and introduction
Defining a future strategy, positioning, and product specification for a vehicle's new value-added service
Market introduction of a revolutionary process innovation
Our client had developed a significant technological improvement, with substantial improvements for a major product in a largely saturated B2B market. In spite of the benefits to consumers, our client’s customer, possessing a high market power, wanted to block the innovation to reduce future dependency on their supplier (our client).
We helped the client develop a strategy to create consumer pull by using smaller customers to break through this barrier. At the same time, the question was whether to substitute the predecessor technology, in which large investments had been made, in a revolutionary way or to replace old technology with new technology in an evolutionary manner, taking into account the possible and likely reactions on the part of customers and competitors.
Backward integration by entering a market with a new production technology
After developing a new production technology based on various types of and needs for raw materials, we were asked to evaluate the “if’s” and ”how’s” of market introduction. These were heavily dependent on competitor reactions, as well as on the availability and prices of the specific raw materials. For various resource scenarios, we analyzed the action-reaction patterns of suppliers to determine the best way of introducing the technology.