Goodbaby: How a Chinese Underdog Became a World Leader Through Open Innovation

by Henry Chesbrough and Andy Zhu
01 May 2021

Goodbaby is an industry-leading manufacturer of juvenile products. Under a variety of brand names, nearly a third of the strollers in the world are designed and manufactured by Goodbaby. Founded by a schoolteacher in 1989 with a single stroller patent, the group has since grown rapidly, and now designs and manufactures carseats, cribs, bicycles, apparel, and personal care products, winning international recognition. The group holds more than 10,000 patents and is recognized as a role model entity for intellectual property by the Chinese government. Goodbaby pioneered an inside-out open innovation strategy that allowed it to offer products under its own brands, and in tandem offer its products to domestic and international customers under their brands. The key focus in this case is the decision to invest significantly greater resources in R&D to build strong product differentiation and improved performance. After facing initial difficulties as an OEM, founder Zhenghuan Song was reluctant to rely on the OEM model, opting instead to follow the ODM and OPM models - collaborating directly with brands in the U.S. and Europe and rapidly gaining market dominance.

Learning Objectives

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1. Document the rise of a global leader in juvenile products in China. 2. Examine the benefits and challenges Goodbaby faced, particularly in its willingness to make products for competitors as well as itself, under OEM, ODM, and similar arrangements. 3. Show the economic contributions of an Inside-Out open innovation approach for allowing Goodbaby’s world-class products to enter into foreign markets, and create a virtuous economic cycle of strong R&D investment, growing market share, and increased foreign market entry and penetration, resulting in the ability to re-invest in R&D for the future.

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Details

Pub Date: May 1, 2021

Discipline: Innovation and Technology

Subjects: Open innovation, Product design, Manufacturing, Collaboration

Product #: B5975-PDF-ENG

Industry: Retail & Consumer Goods

Geography: China

Length: 9 page(s)