Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

European economies show dramatic differences in innovativeness

04.08.2003


A study of 137 new product launches in 16 European countries shows the persistence of major regional disparity in the era of the European Union, according to an article in a journal of the Institute for Operations Research and the Management Sciences (INFORMS®).

"While we expected some differences, we were surprised by the size of the differences," the authors write. "We were also surprised by the fact that Scandinavian countries tend to have the shortest `time-to-takeoff´ of all European countries. In contrast, the large economies of Europe – France, Germany, Italy, Spain, and the United Kingdom -- turned out to be less "innovative" than the Scandinavian countries."

Based on their research, the authors recommend that European marketers introduce new products first in a few countries, employing what is called a waterfall strategy, rather than in many countries at once, what marketing literature calls a sprinkler strategy.



"The International Takeoff of New Products: The Role of Economics, Culture and Country Innovativeness" appears in the current issue of the INFORMS journal Marketing Science. The authors are Gerard J. Tellis of the University of Southern California, Stefan Stremersch of Erasmus University, Rotterdam, and Eden Yin of Cambridge University.

The authors employ a hazard model to analyze marketing data.

Normally, a new product is marked by a long introductory period when sales linger at low levels. At a certain point in time, the takeoff, a successful new product breaks into rapid growth and a large jump in sales. Time-to-takeoff is the duration of the introductory stage from product introduction to takeoff.

The authors´ most important conclusions are that –

  • "Time-to-takeoff" for new products differs dramatically between countries (for example, 3.3 years for Denmark and 9.3 years for Portugal). On average, time-to-takeoff takes about half the time in Scandinavian countries (4 years) as it does in Mediterranean countries (7.4 years).
  • Cultural factors partly explains these differences. In particular, the probability of takeoff increases in countries that place high in an index of achievement and industriousness and low in uncertainty avoidance.
  • Sales of most new products display a distinct takeoff in various European countries, at an average of 6 years after introduction.
  • Time-to-takeoff differs dramatically across product classes. The mean time-to-takeoff is 8 years for what are described as "white" goods (kitchen and laundry appliances) and 2 years for "brown" goods (entertainment and information products).
  • The probability of a new product´s takeoff in one country increases with prior takeoffs in other countries.

Because managers are under great pressure to pull the plug on a product that has not taken off, the authors suggest that introducing a product in a few countries that are expected to show early takeoff can win internal corporate support. The strategy allows lets marketers use sales data in one country to forecast sales in other countries where they plan to launch the product. Unfortunately, the authors observe, most European marketers do not introduce new products gradually and pay a penalty in failure.

The authors analyzed the takeoff of 10 consumer durable categories across 16 Western European countries. The study is one of the largest on international new product growth.

The countries included in the study are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. The products are refrigerators, washing machines, freezers, dishwashers, color televisions, dryers, VCR´s computers, CD players, and microwave ovens.

The authors used data on product sales made available by Euromonitor, GFK, The Economist Intelligence Unit (EIU), TableBase of Responsive Database Services, the archives of appliance manufacturers in various European countries, and a private observer.

The authors of this study were recently recognized with an award by INFORMS for research that helped Whirlpool plan the launch of its Personal Valet Clothes Vitalizing System.

Barry List | EurekAlert!
Further information:
http://www.informs.org

More articles from Studies and Analyses:

nachricht Real-time feedback helps save energy and water
08.02.2017 | Otto-Friedrich-Universität Bamberg

nachricht The Great Unknown: Risk-Taking Behavior in Adolescents
19.01.2017 | Max-Planck-Institut für Bildungsforschung

All articles from Studies and Analyses >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Breakthrough with a chain of gold atoms

In the field of nanoscience, an international team of physicists with participants from Konstanz has achieved a breakthrough in understanding heat transport

In the field of nanoscience, an international team of physicists with participants from Konstanz has achieved a breakthrough in understanding heat transport

Im Focus: DNA repair: a new letter in the cell alphabet

Results reveal how discoveries may be hidden in scientific “blind spots”

Cells need to repair damaged DNA in our genes to prevent the development of cancer and other diseases. Our cells therefore activate and send “repair-proteins”...

Im Focus: Dresdner scientists print tomorrow’s world

The Fraunhofer IWS Dresden and Technische Universität Dresden inaugurated their jointly operated Center for Additive Manufacturing Dresden (AMCD) with a festive ceremony on February 7, 2017. Scientists from various disciplines perform research on materials, additive manufacturing processes and innovative technologies, which build up components in a layer by layer process. This technology opens up new horizons for component design and combinations of functions. For example during fabrication, electrical conductors and sensors are already able to be additively manufactured into components. They provide information about stress conditions of a product during operation.

The 3D-printing technology, or additive manufacturing as it is often called, has long made the step out of scientific research laboratories into industrial...

Im Focus: Mimicking nature's cellular architectures via 3-D printing

Research offers new level of control over the structure of 3-D printed materials

Nature does amazing things with limited design materials. Grass, for example, can support its own weight, resist strong wind loads, and recover after being...

Im Focus: Three Magnetic States for Each Hole

Nanometer-scale magnetic perforated grids could create new possibilities for computing. Together with international colleagues, scientists from the Helmholtz Zentrum Dresden-Rossendorf (HZDR) have shown how a cobalt grid can be reliably programmed at room temperature. In addition they discovered that for every hole ("antidot") three magnetic states can be configured. The results have been published in the journal "Scientific Reports".

Physicist Dr. Rantej Bali from the HZDR, together with scientists from Singapore and Australia, designed a special grid structure in a thin layer of cobalt in...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

Event News

Booth and panel discussion – The Lindau Nobel Laureate Meetings at the AAAS 2017 Annual Meeting

13.02.2017 | Event News

Complex Loading versus Hidden Reserves

10.02.2017 | Event News

International Conference on Crystal Growth in Freiburg

09.02.2017 | Event News

 
Latest News

Switched-on DNA

20.02.2017 | Materials Sciences

Second cause of hidden hearing loss identified

20.02.2017 | Health and Medicine

Prospect for more effective treatment of nerve pain

20.02.2017 | Health and Medicine

VideoLinks
B2B-VideoLinks
More VideoLinks >>>