Republic of the Philippines
NUEVA ECIJA UNIVERSITY OF SCIENCE AND TECHNOLOGY
Cabanatuan City, Nueva Ecija, Philippines
ISO 9001:2015 CERTIFIED
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Republic of the Philippines
NUEVA ECIJA UNIVERSITY OF SCIENCE AND TECHNOLOGY
Cabanatuan City, Nueva Ecija, Philippines
ISO 9001:2015 CERTIFIED
Table of Contents
CHAPTER 1: INTORDUCTION AND OVERVIEW: NEW MARKET DEVELOPMENT 5
Jollibee comes to London: Asia’s biggest fast food chain to open first branch in the capital
................................................................................................................................................... 6
ANSOFF MATRIX .................................................................................................................. 9
Product Development Process ............................................................................................... 11
SUMMARY ............................................................................................................................. 13
Activity 1.1 ........................................................................................................................... 14
Activity 1.2 ........................................................................................................................... 15
Activity 1.3 ........................................................................................................................... 16
CHAPTER 2: INNOVATION .................................................................................................. 18
Market development plan for Manitoba agriculture ............................................................. 19
SOURCES OF INNNOVATION ......................................................................................... 22
THE 7 SOURCES OF INNOVATIVE OPPORTUNITY .................................................. 22
WHAT IS THE FIRST MOVER ADVANTAGE? .............................................................. 24
4 TYPES OF INNOVATION ............................................................................................... 26
SUMMARY ............................................................................................................................. 28
Activity 2.1 ........................................................................................................................... 30
CHAPTER 3: PRODUCT MARKET STRUCTURE .............................................................. 31
DITO seen clashing with Globe, Smart ................................................................................ 32
Types of Market Competition ................................................................................................ 34
NEW PRODUCT DEVELOPMENT .................................................................................. 38
SUMMARY ............................................................................................................................. 39
Activity 3.1 ........................................................................................................................... 41
Activity 3.2 ........................................................................................................................... 42
CHAPTER 4: DEVELOPING NEW SERVICES ................................................................... 43
How Grab is becoming an everyday, everything App in Southeast Asia ............................. 44
The New Service Development Process................................................................................ 46
Pricing Service Bundles.......................................................................................................... 47
Users and Lead Users in New Product Development .......................................................... 49
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Approaches to Product Development.................................................................................... 50
SUMMARY ............................................................................................................................. 54
Activity 4.1 ........................................................................................................................... 56
Activity 4.2 ........................................................................................................................... 57
Activity 4.3 ........................................................................................................................... 58
CHAPTER 5: MARKETING RESEARCH TECHNIQUES FOR PRODUCT AND
SERVICE DEVELOPMENT ................................................................................................... 59
Lucky Me! Pancit Canton (Thinner Noodles) is back! ........................................................ 60
Marketing Research Process.................................................................................................. 62
Hierarchy of New Service Categories .................................................................................... 64
Achieving Success in New Service Development ................................................................. 65
SUMMARY ............................................................................................................................. 66
Activity 5.1 ........................................................................................................................... 68
Activity 5.2 ........................................................................................................................... 69
CHAPTER 6: ORGANIZATIONAL FACTORS AND NEW PRODUCT DEVELOPMENT
IN LARGE FIRMS .................................................................................................................... 70
A McVegan burger will be on sale in Europe ....................................................................... 71
DATA COLLECTION TECHNIQUES .............................................................................. 73
NEW PRODUCT DEVELOPMENT PROCESS ............................................................... 74
PRODUCT CHAMPION ...................................................................................................... 75
STRATEGIES FOR LAUNCHING AND MARKETING NEW PRODUCTS AND
SERVICES .............................................................................................................................. 75
SUMMARY ............................................................................................................................. 76
Activity 6.1 ........................................................................................................................... 77
Activity 6.2 ........................................................................................................................... 78
CHAPTER 7: DIGITAL MARKETING .................................................................................. 79
For FMCG firms, it’s time to up their digital marketing game............................................ 80
Digital marketing ................................................................................................................... 82
HOW HAS DIGITAL MARKETING EVOLVED? ............................................................ 85
HISTORY AND EVOLUTION OF DIGITAL MARKETING ......................................... 86
DIFFERENCE BETWEEN TRADITIONAL MARKETING AND DIGITAL
MARKETING ........................................................................................................................ 87
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SUMMARY ............................................................................................................................. 89
Activity 7.1 ........................................................................................................................... 91
Activity 7.2 ........................................................................................................................... 91
Activity 7.3 ........................................................................................................................... 91
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CHAPTER 1
INTRODUCTION
AND OVERVIEW:
NEW MARKET
DEVELOPMENT
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ARTICLE ANALYSIS
Jollibee comes to London: Asia’s biggest fast
food chain to open first branch in the capital [1]
A new competitor to McDonald's Big Mac and KFC
Bucket Meal, fried chicken and spaghetti, is about to hit
London's fast food market. Jollibee, the Philippines'
largest home grown fast-food restaurant, is opening its
first UK store later this month in Earl's Court.
The chain, initiated in 1975 in Manila as an ice-cream
parlour, is known for its fried chicken and spaghetti
signature meal.
It is just the second branch of Jollibee in Europe, after a
launch at Milan in March, when large queues commence
from the beginning of the day. Jollibee Foods
Corporation (JFC) has ambitions to become one of the
top five fast food restaurants in the country. It gets us
closer to fulfilling this vision by launching our first shop
in the UK.'
This signature chicken is said to have crispier exterior
layer because of which it is spicier. The opening is
regarded for the Philippine community as so culturally
important that the Philippine ambassador is supposed to
participate.
The company has a dedicated and massive following in
the Philippines, one of the few global markets in the world
where one of the locally-owned fast food franchises is
bigger than McDonald's.
Based on the article, please answer the following questions:
1. What marketing strategy did Jollibee use from Ansoff Matrix? Cite some examples to
support your answer.
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
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2. If you were the chief executive of Jollibee Foods Corporation, what indicators made
you decide to support the opening of the 2nd store in Europe?
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
3. Based on your answer in question no. 1, what factors affect the acceptance and risk
of goods and services towards the Europe market?
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
LEARNING OUTCOME:
To develop a mature and critical understanding of concepts, theories, and evidence for
effective strategic, management of new product and new service development from a
marketing perspective
LEARNING OBJECTIVES:
At the end of this chapter, the learners will be able to:
1. define New Market Development and New Product Development;
2. understand Ansoff Matrix;
3. differentiate strategies from Ansoff Matrix;
4. utilize Ansoff Matrix as marketing strategy;
5. and analyze the production development process.
INTRODUCTION
The main objective of the business is to generate profit and avoid losses. In order to
achieve this, most entrepreneurs pay attention to enter the market. This chapter focused on
understanding new and existing markets, goods and/or services that would be of benefit to
new and existing entrepreneurs. Certain questions will come to an entrepreneur’s mind such
as: (a) Have you found a potential market that you are missing? (b) Can this potential market
benefit from your new goods and/or services? (c) Can you, or your staff, build a business
development plan, and assess its effectiveness? (d) Will your attempts to enter this new market
be worth your business or organization's investment? The succeeding chapters will guide and
assist entrepreneurs in answering these queries.
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DEFINITION
New market development is the expanding potential of goods and/or services with
the aim of extending scope or tapping into another sector or uncharted market. It starts with
market research in which an organization conducts a segmentation study and brief market
segments that are worth exploring [2]. This is an opportunity to utilize a good or service to
draw potential consumers. For instance, there were no milk tea shop (DTI-registered or nonregistered) in Palayan City, Nueva Ecija since 2019. This is an untapped market for milk tea
industry. Hence, the untapped market is not limited to launching of new good or service (it
could be an existing one).
New product development. In the creation of new goods, two types of needs must
be fulfilled [3]. Firstly, the internal discusses the goals and capabilities of the organization, and
the external examines the needs and wants of the customer.

External Needs. Converge uses pure-fiber optic technology in the Philippines. The
technology has enhanced the Internet experience when browsing, downloading, and
playing by reducing Internet congestion and downtime. It originated in Angeles,
Pampanga
and
has
now
extended
to
Metro
Manila,
Luzon.

Internal Needs. Bounty Agro officially introduced Oven-baked Chicken Chooks-to-Go
in 2008, expecting the reduction from 30 per cent in 2007 to just 5 per cent in 2010 of
the importation price of dressed chicken. This may carry lower prices countries, such
as Thailand, into the Philippines to export their dressed chicken. This revolutionary
move was the winner in value added because it was capable of tasty bounty chicken to
customers at cheaper prices, although Bounty Agro had greater profits as the producer.
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ANSOFF MATRIX
Market
Penetration
Market
Development
Product
Development
Diversification
Figure 1.1 Ansoff Matrix
Ansoff, an early proponent in strategic management, created a matrix that quantifies growth
in market, and goods and services. The Ansoff Matrix helped many corporations get a clearer
view of the uncertainties involved in the development of their firms [4]. In order to achieve
market share growth, the following are Ansoff’s strategies based on Fig. 1.1:
1. Market Penetration. In order to achieve market share growth, the concentration is
on selling existing goods or services to existing markets.
2. Market Development. The concentration is on finding new markets or consumer
segments for the existing goods or services.
3. Product Development (Ansoff Matrix perspective). The concentration is on
designing, and launching of new goods or services for the existing markets.
4. Diversification. The concentration is on the designing and launching of new goods
or services to sell into new markets.
There are two types of diversification [5], which are:
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4.1.
4.2.
Related Diversification. There is overlap between a company and a new
product or market.
Unrelated Diversification. The new product or market is unrelated to the
core business.
One of the prominent fast food restaurants in the Philippines is Jollibee. From the article
analysis section of this chapter, it can be derived that Jollibee is making a great impact not only
domestically but internationally. To further understand some marketing strategies of Jollibee,
Fig. 1.2 describes how Jollibee utilized the Ansoff Matrix [5].
Based on Fig. 2, the following market strategies are as follows:
1. Market Penetration. Jollibee focused on boosting the distribution of its existing
goods to existing markets. This strategy assumes no risk since the existing goods
(ChickenJoy, Yum Burger) were already accepted by the existing markets.
2. Market Development. From the Article Analysis, Jollibee expanded their branches
internationally and still sell their existing goods. This means that there has been a
geographical extension study arising from the approval of the respondents. This
strategy assumes 50% risk since the existing goods were not yet fully accepted by new
markets (i.e. South Korea, Singapore).
3. Product Development. Innovation will be discussed on the next chapter to support
product development. Thus, in the figure, this will assume 50% risk since the existing
markets haven’t fully accepted the newly-added native delicacies (new goods) to its
menu. It can be derived that product’s development purpose is to break down the
saturation point customers towards existing goods.
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Market
Penetration
Sell more ChickenJoy,
Yum Burger,
Market
Development
International Branches
South Korea
Singapore
Spain
Jolly Spaghetti
Product
Development
Add Native Delicacies
to Jollibee menu
Diversification
Jollibee Clothing
Figure 1.2 Jollibee’s Ansoff Matrix
4. Diversification. From the Ansoff Matrix, this had the highest risk among the listed
strategies. Jollibee is known to be in fast food industry. Hence, introduction of Jollbee
printed shirts (new goods), especially if it is far from its product line (unrelated
diversification), might have a questionable acceptance rate of the new market.
Depending on the results of diversification, it might tarnish the reputation of the
company.
Product Development Process
Product development process is a method of carrying out work at both a macro and
micro level [7], detailing what has to be accomplished and how it has to be done. It is clear in
its techniques for deciding what the best output is and what procedures it needs and how to
ensure it is produced properly and efficiently. It acts as a source of institutional information,
so the lessons learnt from each product or service can be further applied in the process of
creating the next product or service.
To demonstrate and have further understanding on product development process, please refer
to Pharmaceutical Development Process (Fig. 1.3).
Step 1. Research and Preclinical. The exploration of new drugs and evaluating a potential cure to
guarantee it is appropriate for a person.
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Step 2. Phase I – Clinical Trials. The medication is administered to healthy volunteers to test its
safety.
Research and
Preclinical
Phase III –
Clinical Trials
Phase I –
Clinical Trials
New Drug
Application
Phase II –
Clinical Trials
Launch and
Production
Figure 1.3 Pharmaceutical Development Process
Step 3. Phase II – Clinical Trials. Experimental medication is tested on a chosen group of people
with a target disease to determine its efficacy and side effects.
Step 4. Phase III – Clinical Trials. A research sample of approximately 1,000 patients, giving a
statistically meaningful outcome, is used to validate the findings of previous testing on
protection, side-effects, and effectiveness.
Step 5. New Drug Application. The organization aims to obtain clearance from the relevant
authorities before releasing the product to the public.
Step 6. Launch and Production. The new medicine is being used. This process also involves more
clinical trials and data collection on the drug's performance.
Each phase in creation is planned to achieve a specific purpose. The essence of the work may
in turn be somewhat different in each step and is usually committed to solving a certain
number of problems, eliminating hidden information or isolating them, taking important
decisions and generating outcomes to be used as feedback in later phases.
The phase of growth also involves steps and simple Go/No-Go decision points. Both points
of judgment represent two objectives: assessing the consistency of the work performed before
the process and revaluing the business case or benefit equation on the basis of additional
knowledge applied during the phase.
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SUMMARY






New market development means to expand the potential of goods and/or services by
going outside of one's current market segment.
New product development means meeting of internal and external needs of
customers.
The Ansoff Matrix helped many companies find the uncertainties involved in the
growth of their businesses.
Market Penetration, Market Development, Product Development and Diversification
are four different marketing strategies derived from Ansoff Matrix.
Under Diversification strategy, there are two types: related and unrelated.
Product development process defines the work to be done at both a macro and micro
stage.
REFERENCES
[1] Prynn, J. (2018). London is getting its first Jollibee. Retrieved 5 January 2021, from
https://www.standard.co.uk/news/london/asian-fast-food-chain-jollibee-to-openfirst-london-branch-a3941891.html
[2] What is Market Development? Definition of Market Development, Market Development
Meaning - The Economic Times. (2021). Retrieved 5 January 2021, from
https://economictimes.indiatimes.com/definition/market-development
[3] Go, J. & Go C. (2017). Principles and practices in marketing in the Philippine Setting.
Josiah and Carolina Go Foundation, Inc.
[4] Ansoff, H. I., Kipley, D., Lewis, A. O., Helm-Stevens, R., & Ansoff, R. (2018). Implanting
strategic management. Springer.
[5] Hooper, A. (2020). 5 Marketing Management Theories that every serious marketer should
know.
Retrieved
5
January
2021,
from
https://www.business2community.com/marketing/5-marketing-managementtheories-that-every-serious-marketer-should-know-02363676
[6] Perolina, R. (2020). Product Review Using Ansoff & BGC Matrix Jollibee Food Corporation.
Retrieved 6 January 2021, from https://www.youtube.com/watch?v=FzIcOhDlRyg
[7] Verzuh, E. (2016). The fast forward MBA in Project Management, 5th Edition, Canada,
John Wiley & Sons, Inc., pp. 44-46
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