Knowledge Bank Blog, New Product Launches

Should vs Could – The Right Approach to Innovation

Are you making what you can make or what shoppers want to buy?

Last week we were at a festival.  The Jacksons were headlining on the Saturday.

For the first 40 minutes or so they were superb.  All the old hits, the co-ordinated dance moves, they were rolling back the years.  Then there was a short pause – images of Michael on the screen, quick costume (well jacket…) change and then they were back on stage.  The crowd fired up for more of the same.

Then Tito Jackson told the audience he was going to play his new single.   And told us it was from his new album.  Three times.  He then played a pretty average song that nobody had ever heard before.  Cue a big drop in the energy of the crowd that never really recovered, even when they went back to the hits later.

Paul McCartney summed this effect up well last week “when I do a new song it’s like a black hole.  But, when I do another Beatles number the audience lights back up”.

Tito Jackson wanted to play his new song.  But the crowd didn’t want to hear it.  That wasn’t what they had come for.

Why are we talking about this?  Well, we think in our industry we often make the products that we can make.  But these are not necessarily the products that shoppers want to buy or use.  It is easy to see how this happens.  There is history – a company has always made these types of products.  There is the category you operate in – these products are typical for this category.  There is factory and supply chain capability – these are the products we are set up to produce.  There is R&D – let’s create a product using this new molecule.

These are all important considerations, particularly factory and supply chain capability.  It is rarely easy or cheap to change those two.  However, these are all inputs.  They are based on what do you, or can you, do.  They are not outputs.  What do shoppers really want to buy and use.   To win in a rapidly changing marketplace, we think companies need to be less input driven and more output driven.

So, how can you do this?

Think Broader.  This is about removing the restrictions to your thinking.  History can be a restriction.  The category you operate in can be a restriction.  Current product formats and pack sizes can be a restriction.  Brand positioning can be a restriction.  All of these things can encourage you to do more of what you currently do.  And these are often not the things that you should be doing.

Sometimes these restrictions are explicit.  For instance, you know you have certain supply chain constraints.  But sometimes these restrictions are implicit.  You might not even be aware of them.  You think like this because you have always thought like this.  Small changes in your frame of reference can make a big difference.  Are we a crisp company or are we a snacking company?  How do we get shoppers to buy our products for on the go consumption vs what product will best serve the on the go consumption occasion?  What can our brand do vs what is the right thing to do?

Think Big not Small.  There are lots of innovations that companies think are big changes, but are actually very small, often unnoticeable, changes to the end user.  For example, in lab tests you can measure an improvement in cleaning performance.  Probably a significant improvement when you measure it scientifically.  But for the average end user, the difference between 95% effectiveness and 97% effectiveness is barely, if at all, noticeable.

Shoppers are prepared to pay more (sometimes considerably more) for better products.  But the difference to what came before needs to be noticeable.  To shoppers, not to us.  An important, maybe a little uncomfortable, question to ask – is this innovation going to be noticeably different or better?  Answer it honestly.  If it isn’t, you might want to think again.

Watch out for the Warning Signs.  Any innovation project gives you signals along the way.  Signals about whether it is likely to succeed or not.  However, as in life, it is often only after the event, that we look back and see them.  So, what are some of these warning signs?  It may be that you can make the product too easily.  Too easy may mean not enough change.  It may be that there is little internal debate along the way.  Little internal debate may mean not enough change.

It may be that you are finding it hard to explain what the product is and why it is good.  When you tell other people about it.  When you communicate on pack or in advertising.  Products that are input driven are often harder to explain.  They are often reliant on the ingredient or the molecule.  You understand the benefit, but shoppers don’t.  Not being able to explain the proposition clearly is a big warning sign.

It shouldn’t be about one thing (what you can make) or the other (what shoppers want to buy).  There should be a sweet spot between the two.  Just like the artist who gets critical acclaim and sells a lot of records.

Not sure Tito Jackson’s new song is there yet.

On a separate note, our monthly article in The Grocer goes out in tomorrow’s edition .  There is a link to it on our website…

Have a great weekend and speak to you next week.