Commercialization or commercialisation is the process of introducing a new
product or production method into commerce—making it available on the
market. The term often connotes especially the entrance into the mass
market as opposed to earlier niche markets, but it also includes a move
from the laboratory into even limited commerce. Many technologies begin in a
research and development laboratory or inventor's workshop and are not
practical for commercial use in their infancy. The development segment of the
research and development spectrum requires time and money as systems are
engineered that will make the product or method a paying commercial proposition.
The launch of a new product is the final stage of new product development and the
one where advertising, sales promotion, and other marketing efforts encourage
commercial adoption of the product or method. Beyond commercialization can lie
consumerization. Commercialization is often confused with
sales, marketing, or business development. The commercialization
process has three key aspects: The funnel. It is essential to look at
many ideas to get one or two products or businesses that can be sustained
long-term. It is a stage-wise process, and each
stage has its own key goals and milestones.
It is vital to involve key stakeholders early, including customers.
Proposed commercialization of a product can raise the following questions:
When to launch. Factors such as potential cannibalization of the sales
of a vendor's other products, any requirement for further improvement of
the proposed new product, or unfavorable market conditions may operate to delay a
product launch. Where to launch. A potential vendor can
start marketing in a single location, in one or several regions, or in a national
or international market. Existing resources and the degree of managerial
confidence may strongly influence the proposed launch-mode. Smaller vendors
usually launch in attractive cities or regions, while larger companies enter a
national market at once. Global roll-outs generally remain the
exclusive preserve of multinational conglomerates, since they have the
necessary size and make use of international distribution systems.
Other multinationals may use the "lead-country" strategy: introducing the
new product in one country/region at a time.
Whom to target. Research and test marketing may identify a primary
consumer group. The ideal primary consumer group should consist of
innovators, early adopters, heavy users and/or opinion leaders. This will ensure
adoption by other buyers in the market during the product-growth period.
How to launch. The prospective vendor should decide on an action plan for
introducing its proposed product - plan shaped by addressing the questions
above. The vendor has to develop a viable marketing-mix and to structure a
corresponding marketing-budget. References
Jolly, Vijay K.(1997) :Commercializing New Technologies: Getting from Mind to
Market;Harvard Business School Press. [Note: a new edition was due in early
2009.] Further reading
Clemens, F. et al.: Xelibri: A Siemens Mobile Adventure; case study of WHU
School of Management, Vallendar, Germany; distributed by ECCH Collection,
England and USA. Dibb, S. et al.: Marketing – Concepts
and Strategies; Fourth European Edition Houghton Mifflin; Boston.
Jobber, D.: Principles & Practice of Marketing; Third Edition McGraw-Hill;
London. Kotler, P. et al.: Principles of
Marketing; Fourth European Edition Prentice Hall; Harlow.
Lancaster, G. and Massingham, L.: Essentials of Marketing; Third Edition
McGraw-Hill; London. See also
Commercialization Reactor Commodification
Technology Transfer