This is Why your New Products “Crash & Burn”

Last month I invited readers to share some of the problems and challenges they need to address in 2014. I offered a free consultation to one lucky winner who asked the most interesting question, which could also be of interest for me to answer for other readers.

Well, the winner is Jean-Francois (JF) who has just started working with a start-up in the tech and app areas – I feel that’s more and more of us these days, don’t you? His question was:

“I would like to commercialize a new XXX; what would be the right approach to identify the consumer need and then the market potential, considering that the company has very limited financial resources?”

This is a great question and a reminder that not every organisation has access to large market research or marketing departments and extensive budgets. In fact, in many companies these roles are being h andled by one and the same person with very few resources; is that your case? If so then you will definitely find this post of interest, but even if it isn’t, I’m sure you will still find value from the ideas shared.

As I had promised, I gave Jean-Francois a one-on-one consultancy which ended up lasting several hours, as he had planned well for our session together. He also happens to be really passionate about his innovative idea, as well as in finding solutions to all his challenges.

The product JF and his team want to launch doesn’t exist on the market today, although there are some products which are unsuccessfully trying to address the perceived customer need. The proportion of product launches which fail every year is generally “accepted” to be about 95% – although why companies continue to accept such levels is beyond me! With such odds, I think it is incredibly courageous to start a whole company based around just one new product idea, but that seems to be the norm in many areas today.

Let’s start by taking a look at some of the reasons new products fail and identify ways to reduce if not completely eliminate them for your next launch.

  1. New product Process wheelThe process itself: Innovation is by definition a creative process, but many organisations use a well-worn, restrictive and uncreative process to develop their new products. They are at best most likely to come up with renovations than true innovations. The solution is to introduce some creativity into the process, and why not include potential customers in the process too?
  2. Meeting company quotas: It is surprising that with such miserable statistics concerning the likely success rate of new products, that so many companies – and which shockingly include many of the largest CPGs around – fix quotas on the number of annual new product launches. How crazy is that?! It just encourages too many new products to be launched too early, and almost guarantees failure! I believe it would be much better to seriously limit the levels of acceptance amongst all new product ideas proposed in any year, then only the best would get through.
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Successful Innovation comes from answering Desires not Needs

What is the difference between a need and a desire? Emotion, that’s what. A need is something for which someone has a necessity; a desire is something they want or crave, whether they know it or not.

There are the three main types of products or services that companies offer; it is important that you underst and the difference between them as well as what you are offering or planning to innovate, if you are to be successful.

Some organisations speak about articulated, unarticulated and unimagined needs, but they miss the power of emotions if they are considering all three as simply needs to be addressed. Unless there is an emotional connection between what you are selling and what your customer perceives he is buying, you are likely to remain at the level of a commodity, or at best are restricted in the price you can charge. Only emotional connection brings passion into the equation, when customers desire or crave your product or service and are willing to pay (almost) anything to have it.

Examples of Great Emotional Connection

Think about Apple as a great example of a company that brings passion into their products, so that potential customers pre-order or spend the night queuing in front of the shop in order to have the privilege to give Apple their money in exchange for the latest gadget.

Now I love Apple as much as most people, but are their products really worth more than their competitors? Was the iPod really that much better for listening to music on the go? Probably not, but it is their customers’ desire to be a part of the Apple “family” that makes them crave their products.

Another example is Marlboro cigarettes. Do they really taste better than other br ands? Maybe, but it is not the taste (alone) that makes smokers remain loyal to the br and; rather a feeling of community and adherence to a desired image.

And speaking of taste, what about colas? The now famous brain imaging study run by Baylor College of Medicine – you can read more about it here – showed that consumers thought Pepsi tasted better that Coke, but there was something very different happening in the brain when consumers thought they were drinking Coke or Pepsi. It was what the consumers were thinking that made the difference, a result of br anding.

So what can you do to make your customers think differently about your br and, so that they remain loyal to it, desire it and even crave your product or service? Bring in and stimulate their emotions; here are four ideas on how this can be done:

#1. Make them feel special, different, privileged

This can be achieved through:

  • higher prices – many premium and luxury products are priced more on image than on cost and their customers are happy to pay more for the associated image that has been created
  • membership to a br and club with special privileges – Nespresso is a great example of this; their clients get to order online and even get asked their opinion or to choose new flavours
  • personalised offers – unlike clubs, these are offered to a wider group of purchasers (on a mailing list for example) but the wording of communication and the offers proposed are personalised to each target group, so they are perceived as more personal

#2.

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Brands need to Cultivate Storytelling

Storytelling is a natural human behavior. In all cultures around the world, it has been used to convey learning and history, as well as to entertain children and adults alike. It has developed down through the ages for transferring knowledge long before books and now the web enabled their storage.  

Big brands and those that resonate with their customers, all have myths and stories built up about them. Do yours?

Stories of an iconic br and

When I worked for Philip Morris International, I first heard about this for the iconic Marlboro br and. At that time, it was rumored that Marlboro was financing the Ku Klux Klan in the US, because its packaging had three red rooftops or “K’s” on it. As this was certainly neither true nor desirable, the powers that be decided that we should remove one of the K’s by making the bottom of the pack solid red.

We thought that the rumours would then stop, as we saw them as negative for the br and. However, our consumers had the last say, because they then replaced the KKK rumour with one announcing that Marlboro hated blacks, Asians and Indians. This second story came about because a consumer had found the printer reference markings of coloured dots on the inside of the pack when he had dismantled it.

 

Customers tell stories about “their” brands

There are many myths about the greatest br ands around, coming from their packaging or communications in most cases. Toblerone is romoured to have the “Bear of Berne” and the Matterhorn exemplifying its Swiss origin on its pack, which also resembles the Matterhorn mountain. Camel is said to show the “Manneken Pis from Brussels” on the back leg of the camel of its pack, although I am not sure where that comment originated!

Other br ands develop stories through their communications, that are then shared and repeated by their customers. Examples of these include Columbia Outdoor wear’s “Tough Mother” campaign, Harley Davidson’s enabling “middle aged” men to become bikers at the weekend, or Dove’s campaign for real women to name just a few. All these stories emphasize the connection their customers have with these br ands, making them almost a part of their families through this emotional connection.

 

What stories are told about your brands?

What do your customers say and believe about your br ands? Rather than trying to correct them, unless of course they are clearly negative as was the case for Marlboro, continue to inflame them and more people will talk and share their proof that it is true. Someone said that there is no bad publicity; I am not sure about that, but it sure fires enthusiasm when people can share stories about their favorite br ands, and today’s ease of sharing through social media makes them arguably even more important.

One word of warning though; your br and has to live up to the story; Columbia’s wouldn’t have worked if their gear failed in the real world, nor Dove’s if they had moved to show women that looked too much like top models in their advertising. Continue Reading

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