Question

For technology-based ventures, sometimes innovation results from recognizing an unsatisfied need in the marketplace, such as with the development of high-speed internet to replace slower dial-up modem access. Other times companies develop a new product because they can even if there is no recognizable need in the marketplace, such as a software developer releasing an updated program every few months. Explain why the first situation is commonly referred to as "market pull" and the second situation is "technology push". What are the pros and cons to each situation? What risk(s) and reward(s) might each have?

Answer 1

Explanation:

Market pull can be defined as a strategy in which the organization develops a new product or service for customers to look for the company, which means bringing customers closer and gaining the advantage of loyalty and increasing the customer base.

The first example shows the market pull by developing a consumer need such as high-speed internet to replace a slower internet, that is, the company attracted consumers from a need that was not met in the market.

The advantages of this strategy are consumer loyalty , and the disadvantages may be the difficulty in designing a new product that meets the real needs of consumers and is well accepted in the market.

The "technology push" is the strategy used when companies are already recognized in the market enough to influence the demand for their products and services, and then launch new technological products with the expectation of creating the need in consumers from the value that the company have on the market.

The advantages of this strategy can be the increase in the brand value in the market, and the disadvantages can be spent on technological developments that may not be well accepted by consumers.