Articles

7.1.2011 Innovation models change

Major companies such as GlaxoSmithKline, Siemens and Renault are benefiting from innovation originating in emerging markets. Last year, the Chinese arm of Coca-Cola created fruit drink Minute Maid Pulpy, which has been introduced across Asia and Latin America, and is soon to be launched in Eastern Europe. "This is one of the most successful Coca-Cola innovations of the 21st century," Joanna Lu, Coca-Cola's Chinese marketing director, told the Financial Times. Nokia, the mobile giant, has also adapted its portfolio in developing economies, covering low-cost products for shoppers with limited disposable income and high-end smartphones. As rivals as Lenovo, the Chinese IT specialist, begin to enhance their international presence, they have move beyond simply making discount alternatives to established brands.

BesTV, part of Shanghai Media Group, has built a web-enabled set-top box costing just $30, and that was trialled by France Telecom in Europe. The firm is seeking to expand in Malaysia, Singapore and Vietnam, typically by sharing its intellectual property with local partners. Price considerations play a role in many sectors, and the advent of the recession means cheaper products originally intended for fast-growth economies have often assumed greater importance worldwide. Siemens, the engineering and technology group, witnessed this process first hand after its Indian unit offered up a high-quality, relatively affordable, X-ray scanner camera. Some automakers have followed similar strategies, in recognition of the fact these outlets now constitute the largest opportunities, and generate insights into key future trends.  But the shift in emphasis does not solely apply to big-ticket items, as shown by GlaxoSmithKline, which has cut the prices of drugs for ailments such as asthma, allergies and hepatitis in some countries.

B.L. 7.1.2011