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Vitality index

  • 1.  Vitality index

    Posted 12-13-2019 14:59
    Hello,
    I am looking to information/material to understand how cannibalization that a new product creates ties into measuring its vitality index for the organization. if any one has any information, pl let me know

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    Vinoth Chandran
    Sr. Director Product development/PMO
    Woodstream Corporation
    Lititz PA
    7176262125
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  • 2.  RE: Vitality index

    Posted 12-13-2019 16:19
    Hi Vinoth,

            That's a very interesting question.

    I am not very deep on this topic but I think that it comes down to understanding the direct and indirect cannibalization effect of the new product has on the current product range and comparing the planned vitality index that was done when launching this product (assuming that the cannibalization wasn't taken into consideration) and the vitality index after the launch and the cannibalization occurrence. I believe that understanding this comparison and the difference between both can better support in understanding the cannibalization impact of the new product has on its vitality index.

    I hope this helps. I will follow this thread as I am very interested to see what other members has to say with regard to this topic.


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    Seif Abdelghany
    Local Category Manager
    Electrolux Major Appliance
    10th of Ramadan
    seif.abdelghany@gmail.com
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  • 3.  RE: Vitality index

    Posted 12-19-2019 16:28
    Vinoth,

    There are many ways to calculate vitality, so you need to define vitality in a way that makes sense for your industry.  In the consumer products industry, cannibalization is "good" if the new product offering increases profit margin.  In this case, including cannibalization volume in your vitality index makes sense.

    If a new product offering is primarily to create brand "news", but not necessarily to grow the business - as frequently is the case in food and beverage - cannibalization is fine, but I wouldn't include it in vitality index measures. A good analogy would be "today's special" at a restaurant.  In this case, the objective is most often to drive brand loyalty to the restaurant, rather than grow margin per customer.

    I have some specific examples of both cases if you want to reach out.

    Wayne



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    Wayne Fisher
    Innovation Guide
    Rockdale Innovation LLC
    Cincinnati OH
    513-708-2492
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