Commercialization

Commercialization

Commercialization is the process or cycle of introducing a new product or production method into the market. The actual launch of a new product is the final stage of new product development, and the one where the most money will have to be spent for advertising, sales promotion, and other marketing efforts. In the case of a new consumer packaged good, costs will be at least $10 million, but can reach up to $200 million.[citation needed]

Commercialization is often confused with sales, marketing or business development. The Commercialization process has three key aspects:

  1. The funnel. It is essential to look at many ideas to get one or two products or businesses that can be sustained long-term
  2. It is a stage-wise process and each stage has its own key goals and milestones
  3. It is vital to involve key stakeholders early, including customers

Contents

The Commercialization Process

Commercialization of a product will only take place, if the following three questions can be answered:

  1. When the company has to decide on the introduction timing. When facing the danger of cannibalizing the sales of the company’s other products, if the product can be improved further, or if the economy is down, the launch should be delayed.
  2. Where the company has to decide where to launch its products. It can be in a single location, one or several regions, a national or the international market. This decision will be strongly influenced by the company’s resources, in terms of capital, managerial confidence and operational capacities. Smaller companies usually launch in attractive cities or regions, while larger companies enter a national market at once.
    Global roll outs are generally only undertaken by multinational conglomerates, since they have the necessary size and make use of international distribution systems (e.g., Unilever, Procter & Gamble). Other multinationals use the “lead-country” strategy: introducing the new product in one country/region at a time (e.g. Colgate-Palmolive).
  3. To Whom the primary target consumer group will have been identified earlier by research and test marketing. These primary consumer group should consist of innovators, early adopters, heavy users and/or opinion leaders. This will ensure adoption by other buyers in the market place during the product growth period.

How the company has to decide on an action plan for introducing the product by implementing the above decisions. It has to develop a viable marketing-mix and create a respective marketing budget.

References

  • Jolly, Vijay K.(1997) :Commercializing New Technologies: Getting from Mind to Market;Harvard Business School Press-Note a new edition is due in early 2009

Further reading

  • Clemens, F. et al. (2003): Xelibri: A Siemens Mobile Adventure; case study of WHU School of Management, Vallendar, Germany; distributed by ECCH Collection, England and USA
  • Dibb, S. et al. (2001): Marketing – Concepts and Strategies; Fourth European Edition Houghton Mifflin; Boston
  • Jobber, D. (2001): Principles & Practice of Marketing; Third Edition McGraw-Hill; London
  • Kotler, P. et al. (1996): Principles of Marketing; Fourth European Edition Prentice Hall; Harlow (UK)
  • Lancaster, G. and Massingham, L. (1999): Essentials of Marketing; Third Edition McGraw-Hill; London

See also


Wikimedia Foundation. 2010.

Игры ⚽ Поможем решить контрольную работу

Look at other dictionaries:

  • commercialization — n. the act or process of making something commercial in character. See {commercialize}. [Also spelled {commercialisation}.] Syn: . [WordNet 1.5] …   The Collaborative International Dictionary of English

  • commercialization — 1889, from COMMERCIALIZE (Cf. commercialize) + ATION (Cf. ation) …   Etymology dictionary

  • commercialization — (Amer.) n. process of commercializing, act of making commercial (also commercialisation)com·mer·cial·i·za·tion || kə‚mɜːʃəlaɪ zeɪʃn …   English contemporary dictionary

  • Commercialization — The process by which a new product or service is introduced into the general market. Commercialization is broken into phases, from the initial introduction of the product through its mass production and adoption. It takes into account the… …   Investment dictionary

  • commercialization — commercialize com‧mer‧cial‧ize [kəˈmɜːʆəlaɪz ǁ ɜːr ] also commercialise verb [transitive] 1. COMMERCE to make something available to buyers for the first time: • He doesn t see any rush to commercialize the Sunpower technology for household use …   Financial and business terms

  • commercialization — noun the act of commercializing something; involving something in commerce (Freq. 1) my father considered the commercialization of Christmas to be a sacrilege the government tried to accelerate the commercialization of this development both… …   Useful english dictionary

  • commercialization — commercialize (also commercialise) ► VERB ▪ manage or exploit in a way designed to make a profit. DERIVATIVES commercialization noun …   English terms dictionary

  • Commercialization of space — A DIRECTV satellite dish on a roof Commercialization of space is the use of equipment sent into or through outer space to provide goods or services of commercial value, either by a corporation or state. Examples of the commercial use of space… …   Wikipedia

  • Commercialization of traditional medicines — Biopiracy is a negative term for the appropriation, generally by means of patents, of legal rights over indigenous knowledge particularly indigenous biomedical knowledge without compensation to the indigenous groups who originally developed such… …   Wikipedia

  • Commercialization of indigenous knowledge — Contents 1 Biopiracy and bioprospecting 2 Famous cases 2.1 The rosy periwinkle 2.2 The neem tree 2.3 …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”