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Impact of Product Innovations on Firm Performance

Student: Olga Laul

Supervisor: Tatiana Vetrova

Faculty: Graduate School of Business

Educational Programme: Marketing (Master)

Final Grade: 8

Year of Graduation: 2017

The question of product innovation’s importance is in particular topical and uncertain when the case concerns an industry of purely basic products – Fast-Moving Consumer Goods (FMCG). Do product innovations bring significant positive changes in the business metrics or slight changes of the existing offerings have the same impact on the performance? This is the main question explored in terms of the current research, which aims at studying the character of product innovation’s impact on FMCG firm performance. The study includes consideration of both academic and industrial literature, as well as the empirical part with qualitative data from expert interviews and quantitative information from a case study. The results not only explore the understanding of product innovation by FMCG experts, but also prove the presence of a positive and significant impact. Moreover, such impact exists not only on the level of basic business performance, but also concerning a more global process of market development and attraction of new consumers to the category. In addition, the study touches upon the mandatory conditions for the success of product innovations on the FMCG market.

Full text (added August 14, 2017)

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