Main content area

Value-creation in new product development within converging value chains: An analysis in the functional foods and nutraceutical industry

Broring, Stefanie, Cloutier, L. Martin
British food journal 2008 v.110 no.1 pp. 76-97
foods, novel foods, product development, functional foods, food industry, case studies, human food chain, economic analysis, marketing, Quebec
Purpose -- This paper seeks to shed some light on value-creation in new product development (NPD) projects within the context of industry convergence and to explore alternative types of projects characterised by different buyer-seller relationships. Design/methodology/approach -- There has been much research on value-creation in general, but limited emphasis on value-creation in NPD projects addressing new industry segments emerging from industry convergence (for example, the segment of nuctraceuticals and functional foods (NFF) products that is positioned between the food and the pharmaceutical industries). Based on a multi-case study approach, this paper pursues an exploratory research strategy and investigates 54 NPD projects drawn from a Quebec (Canada) NFF foods cluster. Findings -- In the context of convergence a new value chain is emerging between two formerly separated sectors. Value-creation networks spread across industries and reinforce trends of convergence. Firms face competence gaps in NPD and seek to close these by choosing alternative forms of collaboration. Different types of NPD projects involve alternative forms of buyer-seller relationships and their approach of value-creation is analysed. Research limitations/implications -- A typology of different approaches to NPD in converging value chains is presented along with type-specific implications for value-creation for the required buyer-seller relationship. Originality/value -- This paper provides a unique insight into value-creation in NPD in the emerging NFF sector, in particular, and for converging industries, in general.