Importance of Marketing Innovation and Competitive Advantage

This article discusses the importance of marketing innovation and its role in gaining competitive advantage in the market. It explains how marketing innovation involves applying new methods and strategies to attract more customers and generate higher sales. The article also explores different types of competitive advantage and the Porter generic strategy model. Additionally, it discusses the 4 P's of innovation and their significance in creating value and gaining a competitive edge. Examples of companies like Apple and Tesla are provided to illustrate the impact of marketing innovation on success.

Task 1
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Table of Contents
TASK 1............................................................................................................................................3
INTRODUCTION.......................................................................................................................3
Importance of marketing innovation and competitive advantage................................................3
REFERENCES................................................................................................................................7
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TASK 1
INTRODUCTION
Marketing refers to promotion and advertising of products and services to target people. It
is done with help of various sources such as social media, TV, newspapers, etc. Marketing
innovation is defined as applying new marketing strategies and concepts within market. The
concepts applied unique and distinct which are not been used before (Hernández, Cooper and
Murphy, 2018). Usually, it represents significant change in design or feature or product
packaging. With marketing innovation, promotion, pricing as well as positioning strategies are
changed.
Innovation is process of implementing new idea, concept, process, etc. within an
organisation. With help of innovation organisation is able to gain competitive advantage in the
market. However, concept of innovation is broad as it includes use of new technology and
resources in process or method and doing things in new way. furthermore, innovation must be
related to implementing idea at reasonable cost or to fulfil specific goals and objectives. For
instance- Samsung implement innovation in their products. They launch new smart phones with
latest technology and providing more storage (Ungerman, and et.al 2018).
Besides that, it is necessary for companies to sustain in market and gain competitive
advantage. A competitive advantage is advantage gained by organisation over others. It is either
in terms of value of product or service, low cost, high quality, etc. Here, an example can be taken
of Apple that offer high quality smart phones like iPhone X, XR, etc. as compared to its
competitors (Kim, Kim and Choi, 2019).
However, strategic competitive advantage is gained through strategies that are applied by
company in the market. Generally, they are marketing strategies which distinguish firm from its
rivals. Thus, it has been analysed that marketing innovation and competitive advantage are
interrelated with each other. For example- Amazon gained competitive advantage by applying
various strategies and differentiating themselves from others.
Importance of marketing innovation and competitive advantage
As said by Molina-Castillo, Meroño-Cerdan and López-Nicolás, (2019) in such a
competitive business environment it has been identified for every organisation it has become
difficult to sustain. They need to implement innovation in order to differentiate themselves from
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other in the market. Innovation enable in finding out new and distinct ways of competing within
industry. In this way they are able to gain competitive advantage into the market.
Marketing innovation refers to applying of new methods of marketing in product design,
packaging, promotion, etc. It enables in attracting more people and generating high sales. There
is great importance of marketing innovation for company. They are able to distinguish products
from others easily. The importance of marketing innovation is it in developing new products and
attracting people. With it competitive advantage is gained. New features are added into products
with its design, etc this makes it easy to distinguish it from other products in the market.
As stated by Singh, Kennedy and Cohen, (2018) competitive advantage means that a
firm is able to produce goods and services cheaply as compared to others. It allows them to
compete with rivals and earn more salles and profits. Basically, there are 3 types of competitive
advantage that is cost, differentiation and niche strategy.
There are various models which can be applied in gaining strategic competitive advantage.
But it depends on company needs that which model is to be applied. The common model used
for strategic competitive advantage is porter generic model.
Porter generic strategy
This is also a strategic model which helps in gaining competitive advantage (Aksoy,
2017). It provides an overview to business that how they can achieve goals and compete with
other firms.
Cost leadership – It is a strategy in which company can gain competitive advantage by
becoming the lowest cost provider within industry. They can offer goods at low cost than other
competitors in market. Basically, this type of strategy is applied by large firms that offer goods
with little variation. (Kim, Kim and Choi, 2019).
Cost focus- It is similar to cost leadership strategy where business gain competitive advantage
by offering products at low cost. But the difference here is they firm only do it specific markets
where customer base in large (Singh, Kennedy and Cohen, 2018).
Differentiation focus – It is a business strategy where company focus on differentiating its
products in target market segment. Here, needs of customers are identified and then products
are offered to them. Basically, niche market segment is focused in it. In addition, goods are
placed at premium price as it reflects its high quality and standards (Aksoy, 2017).
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Differentiation leadership – This strategy is similar to differentiation one but here company
gain competitive advantage within industry. The product is differentiated on basis of one or two
criteria and then presented in market. They charge premium price for it and also provide value
added features as well (Sánchez-Gutiérrez, and et.al., 2019).
This model is used to gain competitive advantage as it enables firm to differentiate its
products from another on basis of cost and products. In this firm can provide their products at
low cost to gain competitive advantage. Also, differentiation of product is done in it. Thus,
differentiating enable in creating a distinct image of company in market. With that it becomes
easy to recognise as different brand as well. But in Bowman clock model there are many options
available in it and it focus only on two factor that is price and perceived value.
Moreover, there is another concept of innovation and marketing which is 4 P’s of innovation
(Aksoy, 2017). They are mentioned as :
Product – It is a type of innovation in which new products are offered to people by innovation.
The design is changed or new features are added and then offered to people. So, innovation is
made in product only. (Singh, Kennedy and Cohen, 2018).
Process- This P refers to changing process of operations. Here, production process, delivering
process, etc. of goods is changed (Tabeau, Gemser and Wijnberg, 2017).
Position- This innovation is referred to change in positioning of product in the market. Here,
target market is changed or way of positioning is modified.
Paradigm–the innovation is referred as change in business models or concepts. Usually, goals
and objectives are framed of product or market.
The model will be applied by company as it will allow them to do innovation in any of
above areas. With that they can easily grow and expand in market. Innovation results in creating
value of product or service. Thus, in this way firm is able to gain competitive advantage.
In this an example can be taken of Apple which uses different types of innovation P’s.
they produce new product and also bring changes in their production process. This leads to
innovation and gaining competitive advantage in industry. The company can develop their own
search engine that is Apple search. It will help customers to use this to search info. besides
that, it will enable in attracting more customers as well. The Apple search can be made more safe
and secure. So, by having their own search engine Apple will be able to compete with Google
(Kim, Kim, and Choi, 2019).
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In the opinion of Hernández, Cooper and Murphy, (2018), an organisation can only be
successful when they have gained competitive advantage in market through innovation. They
become market leaders by establishing a large customer base. Also, customers are automatically
attracted towards them because product generate value. Apart from it, company is having ability
to recognise customer needs and develop new products through innovation. In this the only effort
they need to make is marketing innovation. Thus, with help of it they are able to gain
competitive advantage. For instance- Apple continuously do re innovation and develop iPhones.
In a study done by Singh, Kennedy and Cohen, 2018 many companies only need innovation to
become successful. It can be based only on one factor like technology. Here an example can be
taken is of Tesla who is electric auto car company. They have become successful in such a short
period of time with help of technology.
On contrary it is said by Kim, Kim and Choi, (2019) that marketing innovation is not
useful in gaining competitive advantage. It is because change in customer needs can highly
impact on it. So, if organisation is able to fulfil customer needs by generating value of product
they are able to differentiate themselves from other in market. However, the company needs to
do continuous innovation to maintain brand image for long term. This requires huge capital and
other resources. Besides, sometimes innovation fails that results in huge loss. It is because
competitive advantage depends on marketing innovation (Ungerman, and et.al 2018).
Alongside, customer loyalty has to be gained as well for it here, firm can develop new ways of
doing marketing so that more customers can be attracted. It will help in creating awareness more
easily as well. they can change product design, packaging, etc. to attract people. this can be done
through developing strategies. It will help in gaining competitive advantage (Singh, Kennedy,
and Cohen, 2018).
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REFERENCES
Books and journals
Aksoy, H., 2017. How do innovation culture, marketing innovation and product innovation affect
the market performance of small and medium-sized enterprises (SMEs). Technology in
Society, 51(4), pp.133-141.
Hernández, R.J., Cooper, R. and Murphy, E., 2018. Design, the language of innovation: A
review of the design studies literature. She Ji: The Journal of Design, Economics, and
Innovation, 4(3), pp.249-274.
Kim, S.J., Kim, K.H. and Choi, J., 2019. The role of design innovation in understanding
purchase behavior of augmented products. Journal of Business Research, 99, pp.354-362.
Molina-Castillo, F.J., Meroño-Cerdan, A.L. and López-Nicolás, C., 2019. Impact of business
model objectives on marketing innovation activities. European Journal of Innovation
Management.
Sánchez-Gutiérrez, J., and et.al., 2019. The impact on competitiveness of customer value
creation through relationship capabilities and marketing innovation. Journal of Business
& Industrial Marketing.
Singh, H., Kennedy, R.D. and Cohen, J.E., 2018. E-cigarettes and weight loss—product design
innovation insights from industry patents. Nicotine and Tobacco Research, 20(8),
pp.1010-1014.
Tabeau, K., Gemser, G. and Wijnberg, N.M., 2017. Exploration and exploitation activities for
design innovation. Journal of Marketing Management, 33(3-4), pp.203-225.
Ungerman, O., and et.al., 2018. The impact of marketing innovation on the competitiveness of
enterprises in the context of industry 4.0. Journal of Competitiveness, 10(2), p.132.
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