Co-innovation at Mercadona: a radically different and unique innovation model in the retail sector

The purpose of this paper is to describe through an exploratory case study how the leading retailing company in Spain, Mercadona has been able to generate a set of dynamic capabilities -detection, absorption, integration and innovation -that support an original and unique innovation model in the retail sector. This model drives to higher rates of successful product innovation, a constant updating of its range of products according to the ever-changing consumers' needs and outstanding results in terms of reputation and customer loyalty. Thanks to a sustained investment in product innovation and supported by solid theoretical frameworks such as Dynamic Capabilities and Open Innovation Mercadona has been able to develop this pioneering model which could be an interesting benchmark for the industry as well as stimulate future research regarding retailers' role and involvement in product innovation.