Shopper Communication, Knowledge Bank Blog, Category Strategy, New Product Launches, Pricing & Promotions

Missing the Point

Let’s start with a joke.

A successful lawyer buys himself a brand new Porsche Carrera.  The following day he parks it right in front of the office ready to show it off to his colleagues.

As he gets out of the vehicle, a truck speeds past.  It hits the car completely tearing off the driver’s door.

Luckily, a cop is nearby and sees the accident.  The cop approaches the lawyer.  Before he has a chance to say anything, the lawyer starts screaming hysterically.

“The car is brand new.  It’s completely ruined.  It will never be the same…”.

After the lawyer finishes his rant, the cop shakes his head in disbelief.

“I can’t believe you lawyers.  You’re so focused on your possessions that you completely neglect the most important things in life”.

“How can you say such a thing?” asks the lawyer.

The cop replies, “don’t you even realise that your left arm is missing?  It got ripped off when the truck hit you”.

“Oh my god!” screams the lawyer.  “My Rolex”.

Why did we start with this?  Well, we think that in our industry we can spend too much time worrying about the things that don’t matter and too little time worrying about the things that do matter.

It is easy to see how this happens.

We are all close to our categories and brands.  We see everything there is to see about them.  The small details matter to us.  But they matter much less to shoppers.

We have access to lots of data.  So we do more analysis.  But often the deeper you get into the analysis, the more you get lost in it.  Something that started off clear has become anything but.

We want to be action oriented.  So we get into solution mode quickly and run off trying to implement action plans.  But we haven’t taken a step back and figured out whether we’ve identified the right issue in the first place.

The end result? We are focused on the Rolex not the arm.

So how can you spend more time focusing on the things that matter?

Design.  The pack design process is a great example of endless debates about the small things.  It might be the pantone colour of the background.  It might be the curved line that is supposed to be a smile.  It represents enjoyment, right?  Er…if you say so.

Instead you should be having debates about the important stuff.  The most important visual elements that are key to shoppers recognising your pack.  The most important message that you want to communicate.  You should be agreeing what these things are.  Then designing a pack that follows these priorities.  How clear your design hierarchy is, reflects how clear your thinking is.

NPD.  You can spend lots of time worrying about exactly where on shelf your new product will sit.  Can we get it next to the brand leader?  Will it be incremental or will it be one in, one out?

These can be important considerations.  But not as important as whether the product is being launched in the right stores in the first place.  Or the right aisle in store.  Or how you are going to tell shoppers where to find the product.  Lots of new products get the small questions right.  But they get the big questions wrong.  It is usually the big questions that determine success or failure.

Strategy Documents.  We’d love to know how much time companies spend trying to decide what to call things rather than what they should actually do about them.  Segmentations are a classic example of this.

You spend ages debating the name of the 6th segment.  “I think we should call them ‘Pennys’”.  “No, I think they are more like ‘Paulas’”.  “Shall we call them ‘practical’?” “What about ‘pragmatic’?”  The ironic thing is that it doesn’t matter whether you call the segment ‘Practical Pennys’ or ‘Pragmatic Paulas’.  Don’t get hung up on names.  Focus all your attention on what to do.  The right names don’t drive sales.  The right actions do.

Price & Promotions.  Why do brands promote?  There are lots of reasons.  To drive a sales uplift.  To gain market share.  To attract shoppers.  To match what your competitors are doing or what you did last year.   This means that a lot of time is spent looking at promotional efficiency.  If we are running all these promotions, we need to make them as efficient as possible.

However, there is a key reason for running promotions that is often overlooked – because the base price is too high.  All the time you are focused on how efficient your promotions are, you are not focused on the real issue – have you got the right base price?  The base price is a price that enough shoppers are prepared to buy you at.  Not just a price from which to promote.

So, next time you are in a long meeting, ask yourself whether you are getting to the point or missing the point.

Make sure you are focused on the arm not the Rolex.

Feel free to forward. Have a good weekend. Speak to you in a fortnight.