Innovation Management and New Product Development

Project work
Innovation and new product development
The dodow, a natural object to help sleeping

Table of content
I - The innovation
1) Introduction
2) Brief product history
3) Type of innovation
4) Product specification

II - The company
1) Anagraphic
2) Economic & financial performance
3) Products and markets
4) Processes
5) Company strategy
6) IP protection mechanisms

III) Target market of the innovation

1) Technical features

2) Analysis using Porter’s 5 forces framework

A . Threat of the new entrants
B . Bargaining power of customers
C . Bargaining power of suppliers
D . Threat of substitutes
E. Industry rivalry

3) Competitive & Technology intelligence

A. Benchmarking
B. Lead-user analysis
C. Patent analysis -> change by S-Curve
D. Publications analysis

4) Market analysis
A. Segmentation
B. Market regional outlook
C. Market drivers
D. Market key players
E. Target group

IV - Product re-design (TRIZ)

1) Specific Problem: How does my system works?
A- Film making technique
B- Product needs & specifications
C - Ideal final result & ITEMS : how mature is the DODOW’s system?
2) Problem Generalization
A. SU-FIELD ANALYSIS.
B. Understand the hearth of the general problem
C. Physical and technical contradictions

3) General Solution
A -SEPARATION PRINCIPLES
B- INCENTIVE PRINCIPLES

4) Specific Solution
A- Achievable solution
B- Solution for more distant future
C- Patentability
D- Final solution

V- Commercialization
1) Diffusion of innovation S-Curve
2) Commercialisation strategy
3) Distribution Channels
4) Price

References

Appendices

ARTHUR LISE DAVID

 I. The innovation

1) Introduction

Dodow is a French product designed and created by Livlab. If you are French, you can
guess what the use of the product is thanks to its name. If you are not, here's a hint:
The word "dodo" in French means "to sleep".

If you still want some time to guess its use do not read on. So you will have guessed it
(we hope so) this product will help you to fall asleep. How do you wonder?

Dodow is simply a breathing device to help you relax. This will project a blue halo on
the ceiling on which you will concentrate and synchronize your breathing. With this 8-
minute exercise you will slow your breathing to a rate of 6 breaths per minute and thus
relax. In addition, focusing on light and your breathing will keep you from thinking about
what can usually keep you from relaxing.

Dodow therefore allows you to reduce your sleep time.

2) Brief product history

Alexandre-Edouard DUJONCQUOY, founder of Livlab, was an insomniac. He had

thought about turning to the easy solution, sleeping pills, but was reluctant to do so
because it is then difficult to come back and it is not very healthy. He therefore turned
to healthier methods such as meditation, yoga...etc. But these solutions required
money and a lot of time.

That's why he has put together a team to create a product that can help people relax
with a simple, healthy and inexpensive solution.

The team is composed of four people who have all experienced sleep disorders or
forms of relaxation:
- Alexander, founder: Knows insomnia and heals with meditation.
- Pierre: Designer at Unilux who couldn't find sleep through his thoughts that
were spinning in his head.
- Guillaume: An adept of oriental culture and yoga.
- Greg: A devotee of meditation.

3) Type of innovation
To begin our analysis, we therefore use The Henderson-Clark Innovation Model to
determine what type of innovation it is.

In view of the innovation model, it cannot be an incremental innovation or a modular

innovation because it is not an evolution of an existing product. It is not the
improvement of the components of a product and therefore its evolution.

Therefore it is an architectural and radical innovation. This is an architectural innovation

because this method of relaxation is already available in meditation and yoga. In
addition, there are also smartphone applications that help you breathe and relax.

But it is also a radical innovation because there is no similar product: to help relaxation
through breathing with the help of light. There are relaxation products but with the help
of nature sound, voices...etc. This innovation is also radical in the sense that this
product does not use a smartphone, which is one of the sources of sleep problems
because of the screen, blue light and keep brain activity awake.

We can therefore conclude that this is an architectural and radical innovation.

4) Product specification

From now on we will focus on the characteristics of the Dodow.

This one presents the following specifications :

- Power supply: 3 AAA batteries

- Dimensions: 8.5 x 2 cm
- Colour: White
- Equipped with 3 blue LEDs on top for light diffusion.
- Above the touch product for activation and program selection:
- 1 press: 8-minute relaxation program.
- 2 presses: 20-minute relaxation program.
- Adherent surface underneath the product.
- The device is designed to switch off automatically at the end of its
program.
- Livlab offers a 100-day trial for its customers and a full refund if
they are not satisfied.
- Price: 49€
II / The company: LIVLAB

Profile

General Information
Name: LIVLAB
Type: start-up
Address: 4 Av Du President Wilson 75008 PARIS (France)

Products and services

Livlab products are all fully-designed for insomniacs and people who suffer from
sleeping problems.
The product portfolio is the following:
1. Dodow: a sleeping metronome
2. HoomBand: headband that whispers stories to get you sleep
3. Sleep Mist

Livlab sells the product Dodow all over Europe and in some other selected countries
like Switzerland, USA, Australia, Brasil, Japan and South Korea.
The customers can buy the product both in retailers and e-commerce (mainly in
Livlab’s website www.mydodow.com, Amazon and other websites)

Corporate form
Livlab is a SARL that is the French equivalent for LLC (Limited liability company) with
a capital equal to 30,000 euros

Founders
Alexandre-Edouard Dujoncquoy (the president from 2012)
M Pierre-Luc Deniel (General Manager from 2015)
M Gullaume-Pierre Foyard Perrier (Assistant General Manager from 2015)

The three main men are partners and founders of Livlab

Financial Trend

Revenues and operating profit

The company was founded the 29th August 2012. On the web is possible to see
(without charge) the balance sheet from 2013 to 2016.

Turnover / Operating income in thousand of euros:

2013: 14,000 / -3,700
2014: 75,700 / 11,900
2015: 1,167,700 / 307,600

In the following chart is shown how the turnover had increased from 2013 to 2015. The
variation is almost 120%, extremely positive.
 TURNOVER
1,400,000.00

1,200,000.00
1,167,700.00

1,000,000.00

800,000.00

600,000.00

400,000.00

200,000.00
75,700.00
- 14,000.00
2013 2014 2015

The company doesn’t have any production assets and declares to produce through an
exclusive French outsourcing partner. Unilux group is already operating on the market
with illumination products.
This arrangement it is also reflected by the structure of the C/E. As a matter of fact the
added value is equal to 483,100 that is 41% of the turnover. The sales’ cost is equal
to 59%, index of an external production. Selling and Plant costs are relatively low (The
operating income is equal to 26%) and the turnover is nearly 15%.

BALANCE SHEET 2016 ANAlYSIS

Assets
The company has a total current assets equal to 827,700 euros from which 646,000
are cash. The value of the stock is equal to 54,600 euros, this low figure is due to the
fact that the finished product is stocked by the outsourcer (Unilux).

The total assets are equal to 843,600 euros, so the company does not own significant
assets.

Liabilities
Liabilities are composed by 350,400 euros of Equity (reserves, capital gains, share
capital). Further more, it only exist short-term liabilities, most of the times based on
debts for outsourcing (278,400) and taxes (150,900).

Main indexes
ROE = Net Income / Shareholder’s equity = 307,600 / 350,400 = 87% (a very positive
figure)

ROS = Net Income / Sales margin = 26% (positive figure)

Liquidity = Current assets / Short-term liabilities = 646,000 / (278,400 + 50,900) = 1.5

(Bigger than 1, so it is positive)

Strength: it is not relevant because the company does not own significant fixed assets.

KEY OBSERVATIONS
The company, thanks to: a positive sales margin, acomplete outsourcing of the
production / stock and a lack of significant fixed assets it is available to give a high
figure for the ROI index and not being bother from demand fluctuation because of very
low fixed costs.
Valuation of suppliers (SWOT ANALYSIS)

1 patent for brand name international / france/ UE

2012.11.12 france
2 y after 2014.10.23 UE
2016 FRANCE again because new information
2017.03.06 - international ; australia, UE, India, Japon Coréa, USA, China,
Switzerland, Russia

III. Target market of the innovation

1) Technical features

2) Analysis using Porter’ 5 forces framework

A- Threat of the new entrants

In this rapidly expanding market, new entrants are numerous and international.
Highly innovative, they represent a threat in terms of product originality.
Companies have to innovate to stay competitive. There is also a threat in terms of
prices because the most advanced products are the most expensive for the moment,
but probably not in the long term.
In addition, because these products acting on consumer’s health, the new entrants
must succeed in convincing about the utility of the product, both in B2B, with health
professionals, first recommenders, and in B2C the target.

B- Bargaining of customers
Consumers have power over choice. In the marketplace, there are a lot of solutions
for getting back to sleep. Between medicines (sleeping pills), meditation classes, yoga
or sports, hypnosis sessions as well as all the various tools offered to fall asleep, the
customer can choose according to several criteria.
-Price: Many applications are available at very attractive prices.
-The quality
-The customer’s beliefs: if the customer is a very rational person, not believing in the
effectiveness of soft techniques, he might prefer to choose medicines or go to visit a
professional. Dodow -> possibility to test it for 100 days

Faced with the many alternatives that consumers have, this presents a challenge to
suppliers on the market in terms of price and product originality, as well as in terms of
credibility with the consumer.

C- Bargaining of suppliers
Seule fournisseur pour la lumière Unilux -> etp francaise experte dans la lumière.
->Impact sur le coût de production.
->monopole des compétences

D- Threat of substitutes
On the market there are alternatives products according to the following criterias:
-Product type: like headband, sleep tool, mobile app. The consumer may already has
preferences in terms of product types.
-Type of features: the tools available on the market act on sight, hearing and even
smell (Sensorwake, Oria). Some offer hypnosis, others meditation, relaxing musics,
lights to regulate breathing. Some product competitors offer several options at the
same time. Dodow offers only the luminous metronome function.
-Use: some tools are positioned directly on the eyes, such as the connected connected
headband Dreem 2 of Rythm. This can make the consumer feel a real management of
the problem at the source, acting on its sight and hearing senses. Dodow, meanwhile,
is a tool that lands on the bedside table and projects lights to the ceiling to regulate
breathing.
Moreover, some products can be used with or without networks, with or without
telephones, to expand the options available. Dodow utilisation does not require a
phone or a network.
-Indirect substitutes: meditation, yoga sessions or medication are alternatives for the
Dodow’s target. If consumers have more confidence in this type of techniques, it can
be difficult for the companies to attract them.

E- Industry rivalry
In the « sleep help » market there are many players who have understood that this
market is expanding. They are international and very innovative.
Some products offers from direct competitors are not differentiated, they help
consumers to regain sleep by acting on his senses: sight, smell, hearing.
The Morphed Tool, similar to the Dodow tool in terms of use, because it is an object
that is placed on its bedside table, offers meditation sessions and sophrology.

However, some players are innovative and offer intelligent and personalised
tools, such as Rythm’s Dreem 2 connected headband.
Thanks to no less than 7 sensors, the tool placed directly on the head allows to
measure and analyze the sleep and the cardiac rhythm of the patient, at home, to offer
him a personalized follow-up. The tool also allows consumers to listen to music, without
headphones and without networks. Dreaminzzz has launched a connected hypnosis
mask, connected to an application.

There are no fixed prices on the market. The mobile applications, with options
similar to the tools offered on the market, are very accessible: Cardiac consistency is
at 1.19€, and the Calm meditation application at about 5€ per month. Respirelax,
offering breathing tutorials, is free.
Some connected objects have low-cost prices, such as Sense’s Sleep Peanut
Connected Case, at 30€, others much more expensive, €130 for Rythm’s Dreem 2
connected headband, or €199 for Dreaminzzz’s Hypnos mask.
Dodow is a 50€ tool. It is therefore relatively accessible for the target.

3) Competitive & Technology intelligence

A- Benchmarking

We find plenty of products for relaxation or sleep assistance. We make a comparison

here of the different solutions available on the market. These solutions are difficult to
compare because they use different technologies. We have therefore selected 2 other
products that are quite well known in this expanding market.

We can observe that there is a real price difference between our 3 products. Dodow
has a price of only 49€ against 2 competitors at 79.95€ and 399€ respectively. This is
due to a very simple design and mode of operation. There are only 2 programs and
use vision as the receiver of the program.

Morphée is also a French product but it is on a sound operating mode. Its use is not
only intended to reduce the duration of sleep. It is distinguished by a wide choice of
combinations: 8 themes, 8 sessions, 2 durations and 2 voices, for a total of 256
combinations.

Dreem 2 is a headband specially designed for sleep assistance. It analyzes your sleep
through sensors and will diffuse sounds through the bone to improve it. But this one
has a much higher price than its competitors.

Finally we can observe this rather telling data which is the number of days of testing
for each product. We can deduce from this that Dodow is truly integrated into the
market and also very confident about the effectiveness of its product by having a trial
period of 100 days, which is much longer than the majority of trial periods than most
products. While Dreem 2 which is the most expensive product only offers a 14-day
trial, which is really short especially for this price. Morpheus stands in between with an
honourable duration of 60 days.

B- Lead-user analysis

The main users of Dodow are people with sleep disorders and sleep disorders. Dodow
being a device whose purpose is to relax, to free the mind and in particular to activate
the baroreflex system which will promote relaxation, it is intended for a wide audience
and to the many sources which prevent falling asleep. Each individual can therefore
have a different source that will prevent him from sleeping, among it we find:
 - Night awakenings
- Stress and agitation
- Insomnia due to pregnancy
- Chronic insomnia
- Thoughts full of thoughts

Dodow is therefore made for all these people, which represents a large number of
users. In a few figures, these potential users are:

- 50 to 70 million people in the US suffer from one or several

sleep disorders.
- 10 million French people who suffer from sleep problems.
- 16% of the population with chronic insomnia.

C- S-Curve

Dodow appeared on the market in 2014. It is one of the first sleep aid products to have
been developed. In comparison to the competitors seen in the benchmarking,
Morpheus and the first version of Dreem were released in 2017.

Since its release, Dodow has seen a new version in 2018 that improves the sensitivity
of the touch surface, the ability to adjust the intensity of the light beam and makes it
easier to change the batteries in the device. There was also an aesthetic and
ergonomic change.

Although the product has only been on the market for 5 years, it has not undergone
any major changes. Moreover, Dodow wants to be a very simple product in its design
and use and that is why it will not undergo any major evolution like its competitors who
have just arrived on the market and can still offer a lot of evolution.

In view of its elements, we can therefore conclude that Dodow has already passed the
emergence phase and would therefore be in the growing phase. It would even be
conceivable that it would already be in the mature phase in view of Livlab's policy to
offer a very simplistic product. But of course, it can also undergo new developments.
It is therefore still in its growing phase.

D- Publications analysis
As the use of Dodow is based on breathing and triggering the baroreflex system on the
body, they provide a scientific demonstration of how this process works and its
effectiveness. In addition, there are many articles on the subject available on the
Internet. You can see below these graphs that show the number of publications on
sleep disorder topics and soft solutions.
 apendice description

As we can see, there is a strong increase in the number of medical publications for the
words "meditation" and "sleep disorders" which are becoming more and more worrying
topics. We notice a slight increase also for the word "baroreflex" with much less
publications per year than the other two but this is explained by the fact that it is a
rather precise phenomenon of the body, unlike meditation and sleep disorders which
are more generic terms.

Nevertheless, we can conclude that publications are generally increasing in the field of
sleep and relaxation. These are therefore topical issues, so the Dodow product is in a
growing market.
4) Market analysis

A) Segmentation
Our market can be segmented according to people with sleep disorders. This is
characterized by poor sleep quality or less than the classical person’s need. This
causes a real discomfort in people suffering, because it affects their energy during the
day. The person may feel that they have not recovered from their past day. This can
therefore affect the ability to think, the mood, the social relations in their daily life.
Sleep disorders can be caused by several phenomena: anxiety, stress, bad habits,
blue light, diet, pregnancy.
These disorders are therefore corrected by acting on disturbing causes.
Thus, any profile, age combined, can be confronted with these types of disturbances,
like a young people passing their exams, an adult stressed at work, a person naturally
anxious, or someone with bad eating habits.
The Dodow’s buyer persona could be a woman of 30 year old, who lives in Paris and
who work ten hours a day as manager position. Meanwhile in her life, she has to take
care of its children and does not have time to take care of herself. When she try to
sleep, she’s still think about its day and about what she does not want to forget for the
next one.

B) Market regional outlook

Regional segment for the « Help to sleep » market is included differents part of the
world: Occidental Europe, North America. The most important market are, firstly the
USA, following the Germany and the France. We can remark that it is occidental and
rich countries.

https://www.lesechos.fr/2017/08/la-france-troisieme-marche-mondial-pour-les-aides-
au-sommeil-154750

C) Market drivers
Indeed, in the rich countries, the high utilisation of mobile phone with blue lights,
the working model make increase the stress in population. For instance, according to
the French Institute for Health Surveillance, in the French market, one-third of people
said suffering of sleeping troubles, three times a week.

D) Market key players

-Medicines manufacturer: Bristol-Myers, Bayer and Merck are the leader in the market
of the medicines delivered without prescription, to help consumers to finally sleep.
-Beddit, a sleep Monitoring Health Application created by a Finnish start-up in 2006
and buyed by Apple in 2017
-All the application like Calm available on all the smartphone
-Within, and its connected smartwatch, buyed by Nokia in 2016
-Oria, with Sensorwake
-Lots of innovative start-ups

E)Target group
Dodow is targeting a specific segment: stressed people in developed occidental
countries who looking for a simple and natural solution to regain normal sleep.
For people not really used to use smartphone.

Thoughtful person

IV. Product redesign (using TRIZ)

In order to redesign the Dodow’s product, we will apply the TRIZ Method. These theory
of inventive problem solving, developed by Genrich Altshuller is a systematic model. It
is based on the fact to starting from a specific problem, to transform it in a general
problem highlighting contradictions. Then, the contradictions are solved by finding a
general solution. Finally, they are applied on the specific solution. This technique
allows us to avoid the psychological inertia we could have to pass from the specific
problem to the specific solution.

1) Specific Problem: How does my system works?

A- Film making technique

Description of the product: Dodow is a metronome that uses a blue light to help people
to sleep naturally in 8 to 20 minutes. It teaches how to reduce progressively the rhythm
of breathing.
Description of how it works:
● Open the battery lid on the Dodow back, with a coin or with a screwdriver.
● Insert three 3 LR03 or AAA batteries.
● Close the battery lid of the Dodow.
● Switching on the Dodow by tapping the touchpad, on the top of Dodow,
depending on the mode wanted :
-Tap once with one finger for the 8 minute mode.
-Tape the touchpad twice for the 20 minute mode.
● The blue light indicating that the Dodow is activate.
● You can changing the brightness setting with 3 differents brightness setting, by
pressing on the tactile surface.
● At the end, the device automatically switch off. If you want to stop it before, just
touch with your finger the touchpad for at least 3 seconds.

Structure: The Dodow is composed as seen in the following image:

 Scheme 1 -Component on the Dodow - Made by the authors

B- Product needs & specifications

Describe functions, value proposition, tangible and intangible features (product
specifications) 


Products needs Technical specifications

Should have a low weight for the easiness to Weight : 200 grams
move
Should be smaller to bring it in the pocket Dimensions: 4.5 x 4.5 x 2 inches.

? Batteries: 3 LR03 or AAA.

Should be longer as possible Duration of battery: 100 nights.

Should communicate how to breath without Blue light

any noise

Should provide personalized light intensity Luminosity: 3 differents brightness

Should provide different timing breath light 2 Breath helps duration modes
helps
C - Ideal final result & ITEMS : how mature is the DODOW’s system?
The way towards Ideal Final Result requires eliminates ITEMS:

ITEMS
● Information: the duration of the breath help, the light intensity desired, manual
utilisation about products & different
● Time: time to change batteries, time to use, time to learning how it is works, time
to help breath session, time to store the object
● Energy: for the light, for the device
● Materials: batteries, touchpad, blue light, printed circuit board, spare parts
● Space: sleeping room, bedside table, chamber ceiling.

Distance from Ideal Final Result:

Useful functions for the user:

● To reduce time to fall asleep
● Simple and economical solution to fall asleep
● Natural solution to fall asleep: without any medicines which could be bad for the
health, and any medical prescription needed.
● To be quiet: to not disturb any other people in the room
● User-friendly
● Lightweight and small for an easy-to-move and easy-to-manipulate object
● Affordable product: in term of price and way to own it

Undesired functions + costs for the user:

● The disturbing factors: the light could be a disturbing factor for the user’s
company in the bedroom
● Limited options for fall asleep: the Dodow propose only one way to fall asleep,
by the light. Moreover there is only two modes, which could be judge too simple
by users.
● User position in the bed imposed: the Dodow must be put on the bedside table,
the back of the product directly on the bedside table, to allows the blue light to
be projected in the chamber ceiling. Consequently, user has a sleeping position
imposed, the eyes toward the chamber ceiling.
● Space occupied when you move with (for instance in travel)
● Re-charge / buy batteries: it could be annoying for the user to pass time to find
new batteries.
● Weight
● Energy consumption
● Costs: the Dodow’s price is a relatively accessible price
● Product Fragility: because the Dodow put off by itself. Thus during the night is
it still in the bedside table. For instance during the night the user could do a bad
mouvement, or an animal could come and put it on the floor.
● Negative sleeping impact of the blue light

If we make the ratio between desired functions for the consumer and the undesired
functions and cost, we could say that Dodow is not too far from the Ideal Final Result.
Indeed, Dodow do not present too much undesired functions and its price is relatively
correct.

2) Problem Generalization
At this step, we generalize the specific problem to a general one. The aim is to highlight
physical and technical contradictions.

A- SU-FIELD ANALYSIS.
To abstract the problem, we identified the different elements and the field we want to
works on, in order to build the following model.

Scheme 2: Arthur

B- Understand the hearth of the general problem

As we can see in the scheme, the main problems are:

● User position: which is imposed by the Dodow orientation

● Light: which can disturb the other people in the bedroom
● User which has to change the batteries

C. Physical and technical contradictions

->it is the insufficient actions and the undesired functions

3) General Solution
In the TRIZ analysis, a general solution is already available. At this step, we will try to
solve the previous exposed physical and technical contradictions by finding a general
solution.

A- SEPARATION PRINCIPLES
B- 40 INVENTIVE PRINCIPLES

4 ) Specific Solution
At this step, we will apply the general solution to the specific solution by using the
patent analysis.

A- Achievable solution
B- Solution for more distant future
C- Patentability
D- Final solution