Electrolux 2006 Annual Report Download - page 24

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» Electrolux process for consumer-focused product development – “Thinking of our users”
Strategic
market plan
On which areas should we
focus our innovation work?
Which changes in consumer
behavior can create business
opportunities? Where are the
growth markets? What can we
do that our competitors have
not done?
Identifi cation of con-
sumer opportunities
In line with our global method, con-
sumers are grouped according to their
different needs. Each new product
is developed to meet needs that we
have identifi ed within a specifi c target
group. What kind of problems and
needs do these consumers have? How
important are they?
Primary development
What technology is needed to
meet consumer needs?
Concept development
Process for product development
Thoughtful design
Consumer interest in design is increasing continuously, which also
increases the importance of design as a competitive tool. More and
more people are willing to pay for good design. The Group’s invest-
ments in design, which is a part of the product-development pro-
cess, help to strengthen the brand and contribute to greater demand
as well as higher margins.
High rate of investment
Since 2002, investments in product development have increased
from approximately 1 percent of sales to 1.8 percent in 2006. At the
same time, development has become more effi cient through global
cooperation and coordination of launches between different prod-
uct categories. Investment as a percentage of sales is expected to
increase somewhat in coming years. The focus is on developing
products in profi table segments and high-growth areas, simultan-
eously making launches more accurate.
Unique process for product development
The Electrolux process for consumer-focused product develop-
ment, “Thinking of our users”, was introduced in 2004 and is unique
within the industry. A considerable share of investment is devoted to
the early phases of the process, prior to large investments in produc-
tion, in order to ensure that the product is successful.
Floor care – Demand for bag-
less vacuum cleaners is grow-
ing continuously. Consumers
appreciate not having to buy or
change dust bags, but they
also feel that cleaning a
vacuum cleaner fi lter can be
diffi cult. Electrolux Twinclean
solves the problem by cleaning
its own fi l ter.
Product development based
on consumer insight was ini-
tially introduced for fl oor care
products. In combination with short product life-cycles, this means
that a great part of the Electrolux vacuum cleaners on the market
today has been developed on the basis of consumer insight.
Kitchen – Electrolux Glacier
is the freezer that provides
ice-cubes without requiring
the user to fi ll a container with
water. Glacier is the market’s
fi r s t freezer to combine Euro-
pean standard dimensions
with a built-in icemaker.
Electrolux is now launching
kitchen appliances that have
been developed on the basis of
consumer insight. New prod-
ucts generated by this process
will be launched continuously
in the future.
strategy / product development
Defi nition of functions, features,
color and form. At the same
time, we investigate how to best
produce and sell the new prod-
uct. We construct prototypes of
the product and determine how
it will be distributed.
Development of the product con-
cept through interviews, focus
groups and surveys.
Product
development
Focus is on developing
products in profi table
segments
20