Commercialization of Innovation: A Comprehensive Guide

This presentation explores the crucial process of commercializing innovation, focusing on the commercial funnel and its application in New Product Development (NPD). It delves into building an innovation business case, including funding strategies, and examines methods for protecting intellectual property. The presentation utilizes real-world examples, such as Amazon Go, to illustrate key concepts and provide practical insights.

LO3 Discuss the process required
to commercialise innovation

Table of Content
• Introduction: Slide 3
• P5 Explain the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation of innovation. Slide 4 to 14
• P6 Build an Innovation Business Case for an organisation, including ways to access funding.
Slide 15 to 19
• LO4 Evaluate the range of methods for protecting ideas and understand their advantages and
disadvantages. Slide 20
• P7 Evaluate the different tools that organisations can use to develop, retain and protect
knowledge and intellectual property. Slide 21 to 22
• Conclusion: Slide 23
• Reference list: Slide 24

Introduction:
• The following slides will show the importance of commercial funnel
and how it can be applied in the NPD or new product development
process. the various tools that help the process to be successful in the
market are also described. apart from that, a business case for an has
been taken and different ways of funding and how the company can
sustain in the market have been discussed. At last, the tools of
developing, retaining and protecting intellectual property is displyed
in the slides.

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation.
• As Amazon Go is the grocery shop started by the online retailer
Amazon, the company has launched some new products as well.
Initially, Amazon started to sell Organic Apple Juice.
• Within the first few months, the sale was increased by manifold and
the company witnessed a significant revenue.

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• The structure of commercial funnel makes sure that the sales and profit of a
company increases significantly. There are four steps in the commercial funnel.
• Attract: The first step of the concept is to make people aware of the existence
of the product. While a large amount of the population will know about the
product, some among them will buy it (Kim, Park and Lee, 2014). In case of
Amazon Go, the company wants to make sure that the launch of its varieties of
Organic Juices is known publicly.
• Convert: As the next step, the company must ensure that people are able to see
the product and know that the product is available in a wide range of variety.
Besides, why the product is different from the similar products should also be
described so that people trust the brand.

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• Though the first two steps are the most important steps and those can’t
be missed, there are some additional ways that the commercial funnel
can be improved.
• Different types of marketing channels can be utilized to attract more
customers
• The marketing campaigns of the company should be analysed
regularly, and rectifications should be made immediately

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• The picture below is helpful in understanding how the commercial
funnel works:
• Figure: Commercial funnel
• Source: (Bergh et al. 2017)

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• The NPD or New Product Development Process:
• A company must have a proper and documented approach towards
NPD or New Product Development so that the company can
successfully achieve a new product and implement the product
successfully in the business. Thus, the company will have a clear map
of how to get ahead by developing the new product (Gopalakrishnan et
al. 2015).

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• Risk of failing: The risk of failing in the market varies from product to product and so does the
revenue generation. The table below shows how the success and failure can affect the new
product development over a period of five years:

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• The necessity of structured New Product Development process: The New Product
Development team is put under pressure all the time so that they can come up with different and
extensive portfolios of new products ad they can manage the risk related to developing these. The
table below shows the major factors that the emergent models have:

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• The success measurement: It is evident that there’s no absolute term
that can make sure that the NPD process will be successful. The
success depends on the realistic target setting and having an objective
that draws on the new product development process.
• However, there’s two basic points that can be remembered:
• The success of new product depends on situations
• There’s not a dingle factor that can ensure the success of the new
product

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• Keystones of success: Here are some points that the companies like
Amazon Go can keep in mind while developing new product.
• The company must have a long-term, distinguished strategy related to
product development
• The company should be ready and able to fund the process with proper
resources

P5 Explain the importance of the commercial funnel and
the application of New Product Development (NPD)
processing for commercialisation of innovation. Contd.
• The most important part is to have a high-quality product that can ensure the
sustainability of the product in the market
• Figure: High-quality product
• Source: (Gomez et al. 2018)

P5 Explain the importance of the commercial funnel and the
application of New Product Development (NPD) processing for
commercialisation of innovation. Contd.
• Development of NPD process: There are multiple steps to the NPD process.
• Figure: New Product Development
• Source: (Yeniyurt, Henke and Yalcinkaya, 2014)

P6 Build an Innovation Business Case for an organisation,
including ways to access funding. Contd.
• The product developed by Amazon Go is Organic Juice.
• The goals of the company are:
• Making best quality product to gain customer satisfaction
• Offering similar products like the market competitors
• Maintain competitive pricing to retain customers from different
income group

P6 Build an Innovation Business Case for an organisation,
including ways to access funding. Contd.
• Resources and abilities:
• Amazon Go has good financial resources and manpower that can help
the company to achieve the objectives. However, if the company wants
to sustain in the market and make sure that its product is increasing the
profitability of the company, it should follow some alternative ways of
funding (Helfat, 2017). Some of the ways of funding is described below:
• Crowdfunding
• Extending the terms of credit with the suppliers
• Amazon lending

P6 Build an Innovation Business Case for an organisation,
including ways to access funding. Contd.
• Instant access to funds: Amazon Go can utilize the modern way of
payment through funding instead of choosing loan or credit cards for
invoicing. Payability surveys the sales history of the company and thus,
the company gets approval for the invoice factoring.
• Employee motivation:
• Apart from trying out different ways of funding, the company should also
make sure that the employee retention level is high. Therefore, the
company can try some methods. The management should communicate
with the employees in order to motivate them just like Tesco does. On the
other hand, the employees should be praised for their effort and rewarded
for their achievement in the organization (Lazaroiu, 2015).

P6 Build an Innovation Business Case for an organisation,
including ways to access funding. Contd.
• Risk factors:
• The biggest risk that a company may face is the emergence of the competitors.
The rising competitors can pose a huge threat for the growth of the company and
the revenue can drastically decline.
• Market share assessment:
• The reason behind assessing the market share is that it shows how a company is
performing in comparison to the competitors. Besides, Amazon Go will also get
the chance of evaluating the strategies that it has implemented and change the
tactics as per the requirement. However, many established companies like
Morrisons, Waitrose etc. have ignored market share just to focus on the internal
metrics like revenue growth, employee satisfaction, leads, awareness, loyalty etc.

P6 Build an Innovation Business Case for an organisation,
including ways to access funding. Contd.
• Importance of annual reports of a company:
• Though every company maintains an annual report, only few of them know the importance of
maintaining the annual reports.
• The annual reports help a company like Amazon go to understand how the financial year was for
the growth of the company.
• Charts and graphs are used to breakdown the complicated data into understandable forms.
• Cash flow statement, bank statement, income statement, balance sheet and financial summary
are included in the annual reports.
• The achievements of the company are highlighted in the annual report. If the company has been
able to increase the sale or productivity which in turn has increased the profitability of the
company, it should be included in the annual report a well.
• Apart from that, the company can also mention the advancements in research, gaining of market
share, honours received by the company or awards received by the employees etc.

LO4 Evaluate the range of methods for
protecting ideas and understand their
advantages and disadvantages.

P7 Evaluate the different tools that organisations can use to
develop, retain and protect knowledge and intellectual
property.
• Different companies have different methods of retaining and
protecting their new products in the competitive market. The
companies have to be careful about developing such a product that no
other company is able to copy either the product or the name of it. The
top management of Amazon Go can use the following tools:
• Trademarks: Trademark is a particular sign that the companies use to
differentiate its products or services from others. The trademark was
originated long back when craftsmen wanted to make their creations
unique by producing marks on those.

P7 Evaluate the different tools that organisations can use to
develop, retain and protect knowledge and intellectual
property. Contd.
• Copyrights: The creators like artists, authors and other creators can
protect their creations and artistic works through copyright laws.
Therefore, it can be said that either the creator of the creation or if the
creator grants permission to someone else, the person can reproduce
the work. However, the right on the particular product remains valid
only for a period of time according to the copyright law.

Conclusion:
• As it can be seen from the presentation above, innovation is
necessary for the new product development process. The companies
should follow certain processes for the success of the new product
that has been developed. The company must follow the commercial
funnel to sustain in the competitive market.

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