Business Definition for: innovation
innovation
use of a new product, service, or method in business practice immediately subsequent to its discovery.
innovation
product, service, or idea that is perceived by consumers as new. There are differing magnitudes of innovation. Adding bran to an established brand of breakfast cereal is considered a continuous innovation in that it constitutes a small change to an existing product with little market impact, as opposed to discontinuous innovations like the personal computer, which caused great societal impact. The public outcry against the "new" Coca-Cola belied the relatively small continuous innovation that it was. An innovative strategy uses continuous innovation to stay one step ahead of the competition.
See also
adoption process
,
early adopter
,
diffusion
,
innovator
Related Terms:
sequence of events beginning with consumer awareness of a new product leading to trial usage and culminating in full and regular use of the new product. Over time the adoption process resembles a bell curve formed by innovators, early adopters, the majority of consumers, late adopters, and laggards.
consumer who is among the earliest within a market, after innovators, to adopt an innovation. According to the bell curve model of diffusion, early adopters are the next 13.5% of the consumers in a market, after innovators, to adopt an innovation. An advertiser can optimize the cost effectiveness of an advertising campaign for an innovation by targeting it toward innovators and early adopters.
process by which a new product or idea attracts the attention and interest of a market and is gradually adopted by the many individuals making up that market. Unlike individual adoption decisions, diffusion is influenced by communication about a product between an ever-widening group of consumers and is affected by the social dynamics of the group.
- consumer who is among the first within a market to adopt an innovation. According to the bell curve model of diffusion, innovators are the first 2.5% of the consumers in a market to adopt an innovation. An advertiser can optimize the cost effectiveness of an advertising campaign for an innovation by targeting it toward innovators and early adopters. See also adoption process.
- marketer who sells one or more product innovations.
Referring Terms:
Copyright © 2007, 2000, 1997, 1987, by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
Copyright c 2000, 1994, 1987 by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
