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If we take the present competitive scenario in any sector, we can understand that until and unless companies innovate their products or services, it's very difficult for them to stay in the game. I will try to explain the above statement: -

Lately mobile telephone operators are working on a new service segment called Voice Message Service (VMS) which clearly shows that to be in a competitive market, companies have to innovate new products, be in form of service or product to woo the customers.

Now if we again take an example of any company "X" which comes with this service first has an edge over its competitors, especially in a telecom market like India which is highly competitive and customers to a very large extent are less brand loyal. Customers always want better and latest value added services. So when company "X" is going for VMS then it has a good chance of retaining its old customers and also add new customers. But company "X" has to make sure that it doesn't stop innovating its services because the competitors are always in a look out to duplicate the services which are taking off. So it should keep innovating new services to keep a step ahead of its competitors.

Brand and Innovation

Brand is a sort of a service from a known source. Now it depends on the perception of the customers - different brand perception for different customers. It actually depends on the product, services, people associated with the product, information, ideas etc. Now it takes a great deal for a company to build it to a strong favorable brand.

But considering the present scenario, there is lot of competition. It's very hard for a customer to differentiate a product or a service from other competitors. Now the only thing that can create a niche for a product is Innovation. By this way companies can differentiate themselves from its competitors.

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* Contributed by: -
Sampad Kr. Swain,
Currently pursuing MBA from ICFAI Business School, Hyderabad.