Creating a New Market Through Conceptualization and Open Innovation: A Case Study of New Product Development in a Resource-Constrained Company

Abstract

This paper aims to demonstrate that even small and medium-sized enterprises (SMEs) and startups with relatively limited resources can create new market categories by exercising their unique conceptual abilities and developing products based on superior product concepts. Specifically, it examines the process by which a resource-constrained startup created a new product concept and transformed a market category through collaboration with an external Original Design Manufacturing (ODM) partner.

The case of I-ne’s hair care brand “Botanist,” which pioneered the new “botanical shampoo” category and rapidly expanded its market share, is analysed. The study focuses on three key actions in bringing the product to market: (1) the creation and flexible reconstruction of an innovative product concept, (2) mobilization of resources through external collaborations, including with technically superior ODM partners, and (3) product design and decision-making guided by the product concept.

This process is examined in relation to previous research on product development approaches, including those based on concept-driven models, social constructionism and open innovation. The results suggest that a lack of resources can foster flexible thinking and rapid response. This may enable innovative approaches unavailable to large corporations, such as the creation of creative product concepts and the discovery of new methods by reinterpreting internal capabilities.