Question

What are the advantages and disadvantages for following marketing strategies? Include examples

a) incremental innovation

b) radical innovation

Answer 1

a) Incremental innovation and radical innovation are kind of complement to each other. Incremental innovation are those innovation which happens in the same. When a company makes some development over its earlier product then it will be incremental innovation. An innovation that improves it's performance,cost and makes the company more competitive. There are advantages of this incremental benefit and these are: I) Lower risk of loosing market: When we develop and make some innovation over its older product we have less chance to loose market. ii) Company becomes more competitive: Due to innovation as the product becomes better than earlier then it actually becomes more competitive. iii) Cost effective: As it is not complete develop or as it is not completely different from earlier there is not that much cost to develop this. iv) Easier to understand to customers: As it is a development in same line so customers can understand the development or innovation easily. One of the good example is Google mail service. It appeared as basic features than and gradually developed its product in same line.

Though there are some disadvantages of this incremental innovation and these are - I) New innovations are some times unnoticeable to customers: When company makes some innovation but if that innovation do not attract the customers then it will loose it's market share. We can the example of NOKIA in this context where company is unable to develop the product and fail to give the message of their development of the product ii) Marketing cost is comparatively high: To highlight it's development or innovation and to give the messages to customers there need to spend as marketing cost.

Radical innovation is completely different innovation i.e when innovation take place from different. There is no similarity with other and earlier product. There are some advantages of this: I) With this development the company can capture the whole through its new innovative product at least at first and second stage of development. ii) It becomes huge profitable and unique product at the initial stage of development if customer accept this development. If this development becomes highly demadable to customers at the initial stage then it will be kind of monopoly over its product or innovation.

Though there are several drawbacks of this radical innovation because these innovation and developments are always risky in terms of market capture. It has risk because customers may not accept this radical innovation and then the company will face major loss.