The Importance of Innovation in Marketing

This assignment requires students to explore the concept of innovation in marketing, its benefits, and how it can lead to increased customer awareness and interest in products. By studying relevant research papers and articles, students will gain a deeper understanding of the importance of innovation in marketing and its role in product development.

Innovation and
Commercialisation

Table of Contents
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
P1 Importance of innovation in comparison with invention..................................................1
P2 Impact of Vision, leadership, culture and team work on innovation and commercialization
................................................................................................................................................2
LO2..................................................................................................................................................3
P3 4 p's of innovation and use of innovation funnel to shape innovative ideas.....................3
P4 Frugal innovation and its use in organisational context....................................................5
LO3..................................................................................................................................................6
P5 Importance of commercial funnel and application of NPD processing for
commercialization..................................................................................................................6
P6 Innovation business case for the organisation and ways to access funding......................9
LO4................................................................................................................................................11
P7 Tools that organisation use to protect intellectual property............................................11
CONCLUSION..............................................................................................................................12
RECOMMENDATIONS...............................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Innovation refers to creative ideas, new thoughts for doing a work or it means value
addition in the product. Apart from this innovation includes new ways of doing work. The
present study is done on Essence drink, a London based company that provide that offers various
drinks. Initially introduced Mango Lassi that has increased its sale in the UK market but now it
wants to bring some innovation and bring Mint Lassi in the market. An in-depth study is done on
impact of vision, leadership, culture and teamwork on innovation and commercialization. In
addition to this the study will discuss about 4 p's of innovation and use of innovation funnel that
influence innovation. There is frugal innovation that has been discussed in detail. Furthermore, in
the present study a business case is discussed that includes ways to access funding. In addition to
this Intellectual property has been discussed in detail.
LO1
P1 Importance of innovation in comparison with invention
Innovation is applying better solution to meet the new requirement and existing marketing
needs. Innovation is something original that innovator originate using his own mind. Invention
is the process of improving product or machine or it is the unique or new method device or
composition.
Difference

Innovation is the major contributor to the growth of Essence drink. A smaller scale
company can grow if it make advanced products like Essence drink is introducing Mint lassi for
increase in its sales to meet the demand of new customers. On the other hand, invention contain
risk as it deals with creating or introducing a new, that may or may not be liked by the potential
consumer, it will hinder growth of company rather than increasing growth (Manzini and
Lazzarotti, 2016).
Innovation deals with practical implementation of new ideas. For example, Essence drink
will apply all the technical ideas and practical skills to create Mint Lassi. On contrary to
this invention needs scientific skills that will cost huge to the company. For this company have to
hire expert from outside who charges high amount of fees. This will increase the cost of firm. So
innovation is better than invention in the context of business cost.
Innovation is spread across the organisation, as it is done on existing products, so it will
increase participation of each and every employee in the organisation and that will increase
motivation among the employees of Essence drink. On the other hand, invention is limited to
R&D department because it needs lots of scientific research, that do not involve members of
other teams and department.
Innovation is done various existing product so it is the source of generating higher
revenues in short time. For example, Essence Drink can introduce changes in its other product
also apart from introducing Mint Lassi. On the other hand invention is done for single product as
it contain huge cost and is less beneficial for Essence drink(Rosca, Arnold and Bendul, 2017) .
Innovation sometimes is not enough to satisfy the need of consumers, A product needs
more value addition and changes. . On contrary to this invention can highly satisfied the need of
potential consumers, as the invented product contain more extra and advanced features as
compare to innovative product.
P2 Impact of Vision, leadership, culture and team work on innovation and commercialization
Vision- If the objective and vision of the company is specific, measurable, achievable,
realistic and timely then there will be a clear picture of where Essence drink wants to do research
and development. The clear vision also helps in identifying the product or process that needs
advancement and value addition. The vision of essence drink are;

 To being the market leader in beverages.
 To expand the product line and business with continuous innovation.
Leadership- A leader is the person who inspire other persons to do a particular task and
also encourage others to bring new ideas (Rosca, Arnold and Bendul, 2017) . The process of
generating new ideas will help in increasing skills and knowledge of the team members and
employees. These skilled employees will use their skills in innovating existing product, as a
result of which cost of product will be reduced simultaneously improve the quality.
In shaping the innovation in essence drink, leadership plays and important role. The role
of leader to motivate their employees to think creatively and out of the box that help the
workforce to give their innovative suggestions. The innovative idea was developed by the leader
and put a big picture of the vision in front of the employees.
Culture- Culture of the organisation have huge impact on innovation and
commercialization. For example, if a company is running its business in a particular region and
want to introduce innovative product in the new region, culture impacts the area of innovation.
For this purpose company may hire its employees from its home country itself . The newly hired
people know culture of the home country more than other people , so it will become easy for
them to analyse the market condition and things related to the innovative product (Leliveld and
Knorringa, 2018) . The stable culture help the company to do innovation and take the risk with
the new product. The culture of the organisation is innovative culture and the workplace foster a
culture that motivate employees to be innovative.
Team work- This factor has always played an important role in innovation, as team
work help in reducing the workload of the single person and helps in bringing more innovative
ideas. In a team all the member will perform different functions to innovate a product for
example if A B C are the team members for doing innovation in a particular product then A may
bring new ideas, B may make plan for innovation and C may execute the plan. This will lead to
reduce the time and individual effort and make more effective innovation (Knorringa and
et.al.,2016) . For carry out the big picture of innovative ideas required effective team work that
help in shaping the innovation as per the leadership vision. In the innovation of essence drink
different teams are working their role for the desired outcome such as; production team, finance
team, marketing team, etc.

LO2
P3 4 p's of innovation and use of innovation funnel to shape innovative ideas
The 4Ps model in innovation is developed by John Bessant and Joe Tidd that also provide
a powerful tool to analyse the innovation. This model include 4 main categories; Product
innovation, Process innovation, Position innovation and paradigm innovation.
Product – The first thing that comes into the mind when thinking about innovation is the
things that a company offers, that is product or service which fulfil the need of customers.
Product is something that satisfy the needs and requirement of people and a company always
want to add value that is innovation to improve product. For example, Essence drink is
introducing new flavour in the Lassi that is Mint Lassi in place of its existing product.
Process- It includes the way in which the product will be delivered and produced. Apart
from this it includes new ideas and methods of doing work (Dahlan, 2019). For example it will
include improved fixed line telephone service. In addition to this process improvement includes
improved retailing logistics and new methods of supplying and distributing the product.
People- Innovation need various new ideas which are generated by people. Thus from
generating the new ideas till its execution there are involvement of people and their mind. For
the purpose of innovation company can take experts from within the organisation as well as from
outside the organisation. It depends on the nature of innovation and affordability of the Essence
drink that which option is best for the company. For example if Essence drink will hire people
from outside the organisation then it would be costly for it but they can take advantage of highly
technical people (Dahlan, 2019). On the other hand if Essence drink will take internal assistance
then it would cost less to the organisation but company can not take advantage of technical and
scientific assistance.
Press- Press refers to the condition and situation in which person operates functions. It
includes resources , best practices and organisational culture. If the organisation has adequate
resources than company can foster creativity and innovation very smoothly. In addition to this if
culture of Essence drink allows free communication among the employees and each level of
management than new thinking and ideas can be generated easily (Hong, Cheong and Rizal,
2016).
Innovation funnel

The innovation funnel is the process of converting the thought or idea into reality and
taking all the steps to implement the plan of innovation in reality. Like shape The main aim of
innovation funnel is to generate as many ideas as possible and refining those ideas then
converting into a small plan. This results in creating funnel like shape from many ideas to few
ideas. It is an excellent tool that prioritize ideas and applying the best and suitable one.
Following are the steps that helps in creating innovation funnel-
The Mouth of funnel- In the first step organisation needs to generate as many ideas as
possible based on knowledge and experience. For this purpose, Essence drink can collect
information from institution and partners. In addition to this it can also do research on strategies
used by the competitors.
Narrowing funnel- The ideas developed by the organisation will be scrutinised and a list
of information is prepared that is useful for generating new ideas. The scrutinisation will be done
on the basis of matching ideas with goals (Hong, Cheong and Rizal, 2016).
Narrowed part of the funnel- Now the particular idea will be selected on the basis of
priority and will be applied on the product and introduced to the market. In this stage, on the
basis of preference one idea is chosen for implementation.
Application of the innovation funnel at Essence Drink:
In the very beginning every member generate many ideas regarding Essence Drink and
collect many information from different institution and do some research on the competitors.
After the idea generation, organisation skim the generated ideas and scrutinisation has been
Illustration 1: Innovation Funnel

done. Lastly the best idea selected and communicate with each and every member who is
responsible for working on this vision to perform the task on their best.
P4 Frugal innovation and its use in organisational context
Frugal innovation refers to a process to discover new business model and value addition
in the product in sustainable and economical manner for offering the product to those who are
unable to afford. It is used by business organisation for the following reasons-
Cutting funds and debts- Frugal innovation aims at best utilisation of scarce resources ,
which results in reducing cost of producing goods. That leads to decrease in cost of debts and
funds of the company (Aydin, 2018) .
Environmental constraints- Organisations use frugal innovation for reducing
environmental constraints like shortage of electricity, water and other resources so that
sustainable production and innovation can takes place. This will not only a contribution of a
company towards increasing the productivity but it is also contributing in sustainable
development of environment.
Encouraging new technology – companies uses frugal innovation to encourage the use
of new technology as , frugal innovation needs lots of research and development , that push
organisations to adopt new ways of doing work.
Fastest growing market – Companies use frugal innovation as these products are
demanded by highest growing market, that will result in increasing brand image of the company
in that market . Ultimately it results in growth of the product of the company (Van de Vliert and
Murray, 2018) .
Caring for rapidly ageing society- Organisation does not use frugal innovation only for
its own interest but it also focuses on the interest of the society, as the frugal innovation includes
healthy and organic products that company produce with the aim of offering these products in
the market.
Application of frugal innovation in Essence Drink:
It is basically provides importance of product and services by moving to lower level to
buyers as it reduces the cost of products that results in less complexity in production part of the
business in order to reach the potential customers as buyers usually avoid complex process to
purchase a product. Essence drinks with low cost by providing lassi drinks with the use of local
resources can help the company to reduce the cost of products in market. It is basically to

provide different products with respect to different preferences of the customers situated at
different geographical areas. It is a good strategy to use frugal innovation as it is best for doing
business by producing different products with the help of less complex functions and according
to the rules set up the government of that region.
LO3
P5 Importance of commercial funnel and application of NPD processing for commercialization
Commercial funnel- It is the process of delivering a product to the customer that starts
from sales lead and ends with deal transaction. The sales lead gathers various contact
information of the customers who need the product and ends with choosing customer and
completing the whole transaction for the settlement.
Importance of commercial funnel
Helps in choosing marketing strategy- Commercial funnel helps in choosing marketing
strategy or the method to communicate with the audience. Some marketers will focus on the
customers who are already in the decision section of commercial funnel . This will make easier
for them to attract those customers towards their product. So commercial funnel is essential for
understanding marketing mix that is needed by the company for its success.
Helps in relating the product to the customer- A company usually describe its product
or talk to their customer in such a way that it helps in identifying the section of sales funnel to
which consumer relates. This will help company in changing or adding the copy or the content of
the message so that it can relate more to the needs of consumers.
Helps in generating more sales- Once a company know how to relate with the customer
then it will be easy to create demand among the potential consumers. That results in increasing
sales and profit of Essence drink in long run. This will ultimately help in understanding how to
gain competitive advantage.
Application of new product development processing in commercialisation
New product development can be define as a process of developing and bringing new
service or product to the market. Innovative businesses prosper by understanding what is the

want of the marketplace and develop new products that are able to meet and exceed consumer
expectations.
Idea generation- The idea for new product development can be generated from internal
sources like ideas from employees, through SWOT analysis and market research. In addition to
this company can also go for market research for analysing the need of consumers and trends of
market for generating ideas.
Idea screening- It involves selecting those ideas which are required and discarding those
which does not come under the preference of NPD(Kelly, 2016).
Concept development and Testing- Now product developer will create a blueprint of
the selected ideas and this concept will be brought into small segment of the target market where
few consumers are there, for the purpose testing for taking feedback.
Business strategy analysis and product development- in this stage company will
finalize the concept and decide marketing mix and branding of the product. Once all strategies
are approved then product concept is transformed into actual product .
Test marketing- Under this customer feedback are taken and changes are made
accordingly.
Commercialisation- In the final stage company apply all the marketing strategies to
introduce the products in the markets. Know markets are decided and final decisions are made
(Kelly, 2016).
New product range at Essence Drink

Ingredients:
 Milk.
 Added flavours
 Mint
 Saffron.
 Ice
 Almond
Packaging
Essence drinks will use plastic disposal pouch for the new product, it will be easy to carry
and use as well as its very cost effective for the company.
Organic characteristics
The new mint lassi by essence drink is completely organic in nature as it is produced by
natural flavours and ingredients. It is also beneficial for the health of consumers.
Marketing

Essence drinks will use effective marketing strategies such as Hoardings, Newspaper ads,
social media etc, to promote their new product in the market. On the other hand, the company
will also offer some samples to the public in malls to promote the mint lassi.
Sales
The company will target mainly the retailers to sell its products to the local customers, in
order to increase the sales initially essence drinks will provide special discounts and offers on the
new product to grab the attention of the customers.
P6 Innovation business case for the organisation and ways to access funding
Executive summary
The present Business plan includes marketing objective of introducing Mint lassi .In
addition to this it also contain the objective and marketing mix of new product. Furthermore
present business plan includes brief discussion on STP and budget made for the introduction of
Mint Lassi in the market.
Marketing objective Objective of marketing of Mint lassi is to
create demand among potential consumer and
increasing sales by 15% of Essence drink by
the end of 2019.
Marketing mix-
Product
Price
Place
Company have decided to fulfill the demand of
consumer by introducing Mint lassi
Penetration pricing will be suitable for
attracting new consumers as it aims at lowering
the prices at initial stage and then increases the
price.
Here Intensive distribution method is decided
for distributing the product, as in this product
can be offered through various outlets which

Promotion
will increase the sales of Essence drinks at
faster rate (Van de Vliert and Murray, 2018) .
Television advertisement is best suited for
promoting Mint Lassi , as it will help in
reaching larger audience within less time
Segmentation , targeting and positioning Segmenting on the basis of geographical area
will be best as Mint lassi will be more
demanded in the hot regions.
The target market should be such that it can
increase sales as well as profit of Essence
drinks, for this purpose company should make
effective structure of the segment by analysing
the strategies of the competitors.
Effective tag lines and punchline can be used
to make a good image and identity in the minds
of consumer (Knorringa and et.al.,2016).
Budget and Monitoring The budget for whole business plan is 23
million pounds.
The business plan will be monitored by
comparing the actual result with the standard
plan. For this a tracking system is developed
that identifies need of budget and control
whole plan automatically.
Ways of accessing funds
Loans -Essence drink can take funds through loans which are provided by the banks after
fulfilling various requirements. Banks can ask for security in exchange of loans. Essence drink

have to go through a process which starts from opening account and submitting documents .
After completion orf the term company had to pay loan with interest (Knorringa and et.al.,2016).
Crowdfunding- is an another form of generating funds from large no. of people. It can be
done through internet. It is based on three actors – that is initiator who initiate the idea of
project ,peoples who supports the idea and the third one is organisation who brings the parties
together.
LO4
P7 Tools that organisation use to protect intellectual property
Intellectual property is refers to the creation of mind such as:- invention and the tool are
used to protect the innovation by the company so that other cannot use.
Following are the ways of protect intellectual property -
Patent- These are the rights provided to the innovator to exclude others from making,
using and selling its piece of work for a limited period. This right is given after filing the
application to US patents and trademark office. The innovator of Essence drinks has to pay fixed
sum of money for the renewal of licence so that there drinks can be patent and no other party
have right to use there ideas or flavours.
Advantages:
 Government gives patent operators with monopoly security for up statutory life of patent
and Essence drinks will have monopoly security if its drinks are having patent and no
other organisation will be able to reach its competition.
Disadvantages:
◦ Patents give for only relatively short economic life as compared to other intellectual
property so, Essence drink may not get similar advantage as it may get with
Intellectual property rights.
Copyright- It is the right of the owner of invention that gives right to the original creator
to give authority to any person who can make use of its original work. For the purpose of
registration of copyright company has to file application to the registrar. In order to take the
authority for the drinks offered by the company, they have to file the application to the registrar
so that other company can not take the ideas in there use.
Advantages:

 There is highly and longer legal life for the invention and will not make economic action
for anywhere near legal life of author or beyond that. Copyright will give advantage to
Essence drinks for long period so that no other firm is able to copy their ideas in order to
make their own profit. This gives the products their own identity in market where they
are easily recognised as they are differentiable.
Disadvantages:
 It protects expression of thought not idea itself so company may have to face challenge as
other firms may come up with some new innovation by taking ideas from the products
offered by Essence Drinks.
Trademark- It is the name, symbol , design that differentiate a product from other .
Trademark aims at exclusively identifying (Dahlan, 2019). Trademark can be bought and sold. It
gives right to the owner to make distinct identity of the product. It may be located on package or
label of the product offered by Essence drinks. Company products are having trademark that
makes its differentiable in market and it become easy for the customers to recognize their
products.
Advantages:
 There are not legal limitations for life of trademarks that Essence drinks is having.
Company may or may not change their trademark and if it changes they make the
customers aware about that with advertisement.
Disadvantages:
 Marketing and advertising cost usually increases and if it is not done that it would
become difficult for the consumer to recognise the product.
Effectiveness and ineffectiveness of the tools
These tools are effective in helping the organisation to protect the creative mind and
invention that has been done by the industry that any competitor cannot able to stole the idea.
The tools are marked on the invention with the name of organisation so that other cannot stole
the idea without permission. The tools are not able to identify the micro local businesses that are
making and selling its piece of work.
CONCLUSION
From the above study it can be found out that innovation and invention are both unique in
itself. Both plays important role in increasing sales of the company. In addition to this it can be

identified that vision, leadership and culture have major impact on innovation and
commercialization. Apart from all it can be found out that 4 p's of innovation and innovation
funnel also help in shaping the innovative ideas. Also commercialisation plays important role in
new product development.
RECOMMENDATIONS
As a junior brand strategy innovation consultant I recommend to the company to market
the new product in the marketplace that help in to bring interest in consumer's mind towards the
product. Awareness of the product should be raise by investing in marketing activity. They
should market the product with highlight the added innovative feature in the new product that
make the hype in the marketplace.

REFERENCES
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development: A meta-analysis. Journal of Marketing.80(1).pp.47-64.
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ORGANISAS TERHADAP KINERJA BADAN USAHA MILIK
DAERAH. Sosiohumaniora.21(1).
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Powell, W.W., 2017. A sociologist looks at crowds: Innovation or invention?. Strategic
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Rosca, E., Arnold, M. and Bendul, J.C., 2017. Business models for sustainable innovation–an
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Van de Vliert, E. and Murray, D.R., 2018. Climate and creativity: Cold and heat trigger invention
and innovation in richer populations. Creativity Research Journal.30(1). pp.17-28.