Knowledge Bank Blog, New Product Launches, Pricing & Promotions

Forced Change

On February 4th 2014, London Underground workers began a 48 hour strike.

171 of the 270 tube stations closed for 2 days. This forced a lot of commuters to explore alternatives to their usual route.

What happened? Two academics looked at the data to find out.

They found that before the strike many commuters were taking the long way to work.

When the strike happened 70% of them had to find a new route. For many of them this new route was a quicker route.

When the strike ended the commuters who stuck with the quicker route reduced their travel time by, on average, 6 minutes a journey.

Given an average journey length of 32 minutes those who permanently switched routes, cut their journey time by about 20%.

A saving of 12 minutes a day. 1 hour a week. 4 hours a month.

The quicker routes were available to commuters before the strike. But the strike forced them to change their route.

Many found a better one.

Wise people say, “if you never try, you’ll never know”. What they don’t say is that most of us only try when we are forced to.

Why are we talking about this? In our industry we can operate like commuters. Often doing the same things in the same way. Day in, day out. Week in, week out. Year in, year out.

Things like annual planning. Similar inputs and outputs each year. Things like innovation launches. Follow the same steps in the process each year. Things like promotional plans. Look at what you did last year. Do the same this year.

We are so busy doing things, that it is hard to take a step back and look at whether we are doing the right things.

It’s often only when you are forced to think differently that you do think differently.

HFSS forces you to think differently about secondary space. A range rationalisation forces you to think differently about assortment. A budget cut forces you to think differently about how to communicate.

And different is often good – as the tube strike showed. So how can you think differently before you are forced to think differently?

Try asking yourself some “what if” questions. For example…

What if you couldn’t launch any new products in the next 12 months? What might you do? You’d probably focus much more on existing products. The ones that get less love but deliver more sales. You’d focus more distribution effort on them. More visibility effort on them. More communication effort on them.

You’d probably focus on more fundamental behaviour changes in your category. The things that can drive true category development. For instance, in oral care, it might be using a mouthwash. In juice it could be drinking a glass a day. In cereal it could be getting used in more snacking occasions. All things you could encourage without new products.

What if you couldn’t run any price promotions in the next 12 months? What might you do? Panic, probably. But once you stopped panicking, you’d start thinking about other ways to drive demand. You’d look at incentivising shoppers in different ways. You might think about how you could reward shoppers for loyalty. Give them longer term incentives to buy your brand each time rather than shorter term incentives to buy your brand this time.

You might look at running more promotional activities that do not rely on a price discount. You might look at what Walkers do with their “Do Me a Flavour” activation. What Innocent do with “Big Knit.” What Cadbury’s do with “Inventors.” You might do activities that you can repeat each year. Activities that only you can do rather than the next price promotion that anyone can do.

What if you couldn’t do any new market research in the next 12 months? What might you do? You’d have to focus on the existing knowledge you have. You’d look to distil it into the most important things you know. The things that, if acted on, are most likely to trigger a shopper to buy your brand or address a barrier to buying.

You’d probably focus more on the commonalities between shoppers and less on the differences. You could focus much less on slicing and dicing shoppers into 6-8 segments. Giving the segments funky names. Profiling each segment on 50+ dimensions. Doing a full day workshop to go through the 200 slide segmentation deck. Then wondering why people are not able to see the wood from the trees.

So, ask yourself some “what ifs.”

Look at the things you currently do. Ask… what if we weren’t able to do it like that?

What would you do?

Like the commuters, you might find a better route.

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