Product development involves creating new products to serve existing markets

Product development involves creating new products to serve existing markets. In the 1940s, for example, Disney expanded its offerings within the film business by going beyond cartoons and creating movies featuring real actors. More recently, McDonald’s has gradually moved more and more of its menu toward healthy items to appeal to customers who are concerned about nutrition.

In 2009, Starbucks introduced VIA, an instant coffee variety that executives hoped would appeal to their customers when they do not have easy access to a Starbucks store or a coffeepot. The soft drink industry is a frequent location of product development efforts. Coca-Cola and Pepsi regularly introduce new varieties—such as Coke Zero and Pepsi Cherry Vanilla—in an attempt to take market share from each other and from their smaller rivals.

247 Mastering Strategic Management

Product development is a popular strategy in the soft-drink industry, but not all developments pay off. Coca-Cola Black (a blending

of cola and coffee flavors) was launched in 2006 but discontinued in 2008.

Buglugs – Coca-Cola Blak 4pack – CC BY-SA 2.0.

Seattle-based Jones Soda Co. takes a novel approach to product development. Each winter, the firm introduces

 

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