Market-oriented new product development of functional beverages
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Date
2006-01
Authors
Sorenson, Douglas J.
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Publisher
University College Cork
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Abstract
Strategic reviews of the Irish Food and Beverage Industry have consistently emphasised the
need for food and beverage firms to improve their innovation and marketing capabilities, in
order to maintain competitiveness in both domestic and overseas markets. In particular, the
functional food and beverages market has been singled out as an extremely important emerging
market, which Irish firms could benefit from through an increased technological and market
orientation. Although health and wellness have been the most significant drivers of new product
development (NPD) in recent years, failure rates for new functional foods and beverages have
been reportedly high. In that context, researchers in the US, UK, Denmark and Ireland have
reported a marked divergence between NPD practices within food and beverage firms and
normative advice for successful product development. The high reported failure rates for new
functional foods and beverages suggest a failure to manage customer knowledge effectively, as
well as a lack of knowledge management between functional disciplines involved in the NPD
process. This research explored the concept of managing customer knowledge at the early
stages of the NPD process, and applied it to the development of a range of functional beverages,
through the use of advanced concept optimisation research techniques, which provided for a
more market-oriented approach to new food product development.
A sequential exploratory research design strategy using mixed research methods was chosen for
this study. First, the qualitative element of this research investigated customers’ choice motives
for orange juice and soft drinks, and explored their attitudes and perceptions towards a range of
new functional beverage concepts through a combination of 15 in-depth interviews and 3 focus
groups. Second, the quantitative element of this research consisted of 3 conjoint-based
questionnaires administered to 400 different customers in each study in order to model their
purchase preferences for chilled nutrient-enriched and probiotic orange juices, and stimulant
soft drinks. The in-depth interviews identified the key product design attributes that influenced
customers’ choice motives for orange juice. The focus group discussions revealed that groups
of customers were negative towards the addition of certain functional ingredients to natural
foods and beverages. K-means cluster analysis was used to quantitatively identify segments of
customers with similar preferences for chilled nutrient-enriched and probiotic orange juices,
and stimulant soft drinks. Overall, advanced concept optimisation research methods facilitate
the integration of the customer at the early stages of the NPD process, which promotes a
multi-disciplinary approach to new food product design. This research illustrated how advanced
concept optimisation research methods could contribute towards effective and efficient
knowledge management in the new food product development process.
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Keywords
Functional food and beverages market , New product development , Probiotic orange juice , Chilled nutrient-enriched orange juice , Stimulant soft drinks
Citation
Sorenson, D.J., 2006. Market-oriented new product development of functional beverages. PhD Thesis, University College Cork.