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5.5.2.2.1 Product Strategy
Although a product refers to anything that can be offered to a market for
attention, acquisition, use, or consumption that might satisfy a want or
need, it is conceptualized as textile finished goods in this research. To start
with, marketing mix begins with clear understanding and strategy of a
product because products are a key element in the overall market offering
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(Kotler & Armstrong, 2012). Furthermore, marketing-mix planning begins
with building an offering that brings value to target customers. Hence, this
offering becomes the basis on which the company builds profitable customer
relationships (Kotler & Armstrong, 2012).
In this research, the product strategy was understood and examined in
terms of bases for developing new product, product development strategies,
new product development processes, branding, quality of products,
employees‘ knowledge about products, and use of customers‘ feedback to
improve the existing or to produce new products. Accordingly, the cross case
examination of the findings indicate that the base for developing new
product in the case firms is customers‘ order. The customers‘ order in this
context refers to placement of customers requisition for new product by
specifying the specific features of their required products.
For instance, the key informant in case five stated that;
"We usually develop new products when we get customers’ order specifying
the different features of the new product. Besides, we also develop new
products when we win bids of usually government organizations. Hence the
source of our new product development is customer’s order’’
A customer‘s order can be one of the sources of information for new product
development but cannot be the only as it is the case in the selected
companies. Besides order based new product development is a reactive
strategy for which the current dynamic market may not lend itself. Hence,
the cross case examination indicates over utilization of reactive product
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development strategy and the case companies have stuck to it as if none
other base exists. However, in the turbulent market, which characterizes the
current textile market, need assessment is the appropriate strategy for
product development.
Regarding the branding issue, most of the case companies brand their
products claiming that their products‘ are better in the domestic market.
However, clear branding strategy is absent in the international markets. The
cross case examination and the findings from the textile development
institute indicates that branding has become very challenging for Ethiopian
textile companies in general and it may take even more time for branding
Ethiopian textile products relative to the competing textile products in the
international markets.
Regarding, the quality of the product, the case companies claim that their
products are relatively judged to be of good quality by domestic customers
but the products are perceived as just product by international customers.
This was substantiated by the key informant in case three stating;
‗’Our products are perceived as good quality by the domestic customers. This
is evidenced by almost no complain regarding quality and rare returns of
products due to inferior quality. However, in the international markets where
we usually sell our products in Europe, customers do not perceive our
products as such. Even when compared to other countries’ products such as
India, Pakistan, and Turkey, customers do not prefer our products.’’
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Therefore, the findings indicate that the product quality issue has become
very challenging in the international markets. The apparent perceived good
quality in the domestic markets may be attributed to low level of competition
and existence of only few variety products. And more importantly, the
government is the major buyer in any case and such products are given to
users on ration bases. Hence, the domestic customers‘ perceptions can be
better understood form individual consumers side than from the government
side.
Regarding customers‘ feedback for product improvement, a mixture of
opinions was obtained. Some of the firms actually use the feedback to
improve their products as per the customers‘ feedback. But others received
customers‘ feedback mainly through returns and claim of allowances for
wrong quality and yet have nothing to do with improvements as the
improvements may call for new machinery for producing better product. In
connection to this, one of the case companies is about to terminate its
international market operation due to high level of returns even from that
low level of export (only 5% the total production) to the international
markets.
The other important issue in new product development is enhancing the
skills and knowledge of employees about the product they sell. Regarding
this, the findings indicate that the case companies believe that their
employees are important for producing quality products and company
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competitiveness but yet special attention has not been given to them as to
how they can improve their knowledge and skills of serving their customers
and producing new products (the detail was earlier presented in section
5.5.1). To this end, it was earlier presented that employees‘ knowledge and
skills form companies capabilities with which companies compete and grow.
This implies that the case companies fail to fulfill the new product
development requirements implying failure to meet the international
markets‘ quality requirements.
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