Marketing Innovation in Service Smes a Study in the Egyptian Food and Beverage Industry

By Elgebali, Marwa | International Journal of Entrepreneurship, September 2019 | Go to article overview

Marketing Innovation in Service Smes a Study in the Egyptian Food and Beverage Industry


Elgebali, Marwa, International Journal of Entrepreneurship


INTRODUCTION

In spite of the decreases in tourism, the Egyptian Foodservice sector has been growing over the past five years (GAIN, 2017). The growth is driven by social and technological shifts, as well as changes in consumer behaviour. Egyptians are spending more time outside of the home and a larger percentage of women are joining the workforce. The main viable advantage of popular Foodservice companies is the cost and prices reduction, which is aimed to hold down the customers' expectations.

Other authors had previously noted the overwhelm empathy that some companies shown for technological advance, leading to a lack of competitive advantages in the field of marketing innovation (Ren et al., 2010). These authors consider marketing innovation as a proper method to acquire sustainable and competitive advantage.

Other authors state that small and medium sized companies can stand out from the big ones applying the concepts of marketing innovation, which consists on continuous and complementary modifications to their current activities and practices (O'Dwyer et al., 2009). One successful example of this line of thinking is the one of Epetimehin (2011), who shown that the innovation in the offered services, prices, promotion and distribution in the insurance sector impacts in a positive attraction of clients, leading to a competitive advantage.

In analysing Nespresso's competitive advantage through innovation Brem et al., (2016) summarized their innovative branding strategy in three important factors positioning, distribution channels (suppliers and selling outlets) and unique customer approach. Some researchers found the innovation capability as a crucial competitive factor for organizations related with tourism (Brooker et al., 2012, Martmez-Ros & Orfila-Sintes, 2012; Rodgers, 2008).

The present study is mainly related with the aim to define properly the concept of marketing innovation and with trying to find the best way to operationalize it in small and medium food service enterprises.

LITERATURE REVIEW

Innovation

Despite the huge increase in literature in the field of innovation -due to the continuously growing importance that has gained in entrepreneurship (Drazin & Schoonhoven, 1996; Drucker, 1985)--there is still no consensus on the definition of innovation (Jon-Arild & Lumpkin, 2001). One of the reasons, some authors says, is the absence of a significant measure, which hinders the development of theories and the subsequent suggestion of actions for companies which wants to apply this concept (Kotabe & Swan 1995).

The concept of newness has been associated with many of the definitions of innovation. Newness is a key factor to distinguish innovation from change and has been proposed as an important factor linking innovation and entrepreneurship in previous works related to the creation and management of new business (Gartner, 1988; Stevenson & Jarillo, 1990; Utkun & Atilgan, 2010).

Marketing Innovation

One of the definitions of marketing innovation states that is the implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing (OECD/Eurostat, 2005). The usage of a new way for selling products or services that includes important changes in the product design, the packaging, the placement of the product or the pricing and promotion can be certainly defined as a marketing innovation.

Another definition, given by Utkun & Atilgan (2010), relates innovation in marketing with the employment of a new marketing method that introduces considerable changes in the pricing, in the promotion or in the packaging of a product.

Nowadays, the determination of customers' needs is not so easy due to the constant and fast changing markets, technology and collective behaviour. These facts make necessary the application of innovative marketing activities in order to expand the satisfaction degree and retention of clients (Noori & Salimi, 2005). …

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