Product and process innovations are generally regarded as strategic competitive vehicles in industry. Identifying and conquering new market niches through focused marketing approachesby emphasizing new product qualities in mature markets − has become a very appropriate innovation strategy in developed economies. Highlighting brand identity of high-quality firms − through repositioning with the aid of touchpoints − may then be a rewarding business case. This paper aims to demonstrate the relevance of innovative marketing strategies on the basis of brand repositioning of mature firms. It uses a case study approach to 'flagship' firms in Sweden to test the economic viability of repositioning of innovative firms striving to access upscale markets. The paper develops finally, based on the theoretical and empirical knowledge acquired from the case studies, a general analysis framework that may be useful for further study of brand repositioning and that may also serve as guidance for companies intending to reposition their brand to upscale markets.Keywords: innovation, repositioning, brand identity, touchpoints 2
Innovation of Firms in Mature MarketsInnovation is a prominent change agent in our contemporary society. It is often regarded as the source of economic progress and vitalization. Seminal contributions on the economics of innovation can be found in the writings of Schumpeter (1934) and Kamien and Schwartz (1962).These early contributions focused the attention in particular on industrial market structures (e.g., monopoly power, scale and size effects of industrial firms), but less on the service sector or the public sector. In the past decade, an avalanche of studies has been published on entrepreneurial motives for innovation, on the knowledge factors involved in innovation, on the policy drivers or facilitators of innovation, and on the broader societal context of innovation (e.g., the creative class; see Florida, 2005). Recent studies on innovation and growth include amongst others, Capello andNijkamp (2009) andde Groot et al. (2004).An important change in innovation studies and practice has been the shift from technological progress studies towards behavioral and organizational aspects of innovation.Consequently, the creation and foundations of technological change have been given more attention, as well as the diffusion and the impact of technological change, following earlier studies of Hägerstrand (1967). Knowledge and creativity are increasingly regarded as the new engines of innovation, as they may stimulate more flexibility, design of out-of-the-box concepts, managerial diversity, and smart search behaviour.Another important component of modern innovation systems is the fact that socio-cultural value systems and market conditions are seen as critical success factors for the firm's innovative behaviour. In other words, innovation is not exclusively focused on new products, but also on the creation of new processes, procedures, management styles, and even product images that enhance the buyers' s...