Manufacturers are increasingly turning to innovation and the development of new products in the hopes of generating increased sales and profits (Abetti 2000, Chandy and Tellis 2000). However, the value that innovation efforts generate for firms is limited when new products are launched through large retailers, because manufacturers must share a portion of the value with these retailers. This is a challenge, since manufacturers and retailers are rivals for value extraction. While the growing power of retailers creates challenges for manufacturers, research on new product launches is currently limited. It has not yet addressed distribution-related issues and the difficulties that manufacturers face when dealing with large retailers. This two-essay dissertation therefore investigates some of the challenges that manufacturers face when launching new products through large retailers.
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