Supercharging Your Product Innovations
Successful innovation is a critical driver of brand growth and profit. Not many consumer packaged goods (CPG) companies would dispute this statement, yet for something so important, it is shocking that upwards of 70% of new product launches will fail within the first two years. In any facet of life or business that is a daunting statistic, and a statistic that equates to millions of dollars of waste.
Remember the days when securing on shelf availability for your new product launch was the finish line, and a well placed flyer ad was the boost needed for the win? Consumers had a linear path to product choice and selection. Perhaps they saw an advertisement placed within their favourite evening cable television show, or maybe they saw a print ad in their monthly subscription. From that exposure, awareness was created. Shopping was done in a physical world, and as long as the new product was in the store, and maybe in the flyer, the awareness trigger had a reasonable opportunity to be converted to a purchase. A simpler time for certain, and one that has passed the world by.
Today’s CPG industry is exploding with new products. Tens of thousands of new products are launched every year, and an overwhelming majority of those will fail. Innovation is a strategic pillar of growth and profit for virtually every company, yet the failure rates are staggering. In a world fraught with risk and failure, how can CPG brands increase their odds of success? It goes without saying that product innovations must solve a problem, deliver quality and provide a value proposition for consumers. Brands must continue to successfully secure optimal retail shelf-space and availability. But what else? How can CPG brands supercharge their innovation launches in an omnichannel world teaming with unprecedented levels of media content, brand and channel choice, and consumers with evolving needs and sky-high expectations?
Define your Consumer Target as Completely as Possible
In a world of diversity and uniqueness, brands must define and find “their people”. Understand the consumer better than anyone else. Understand their preferences, their expectations, their unmet needs. Only with a deep understanding of the consumer can a brand begin to craft a product and the supporting content with the power to breakthrough and make a meaningful connection. Brands that stand for something, for someone, and deliver on their promises increase the odds of success in a marketplace littered with the skeletons of failed innovations.
The notion that a brand’s target audience is one homogeneously defined group of consumers is an outdated one. By leveraging highly attributed consumer data, successful CPG brands create multiple unique consumer segments, or personas, which in aggregate represent significant growth and volume opportunities. Through these tightly defined audience targets, brands create and distribute content that is relevant and will drive awareness, consideration and engagement.
Creating Awareness, Consideration and Trial in an Omnichannel World
In an omnichannel world brimming with product choice, it has never been more challenging to generate trial for new products. Consumers are bombarded with upwards of 10,000 brand references every day. How can CPG brands break through the noise in order to drive awareness, consideration and finally, an initial purchase? Create an omnichannel product experience for consumers. Meet consumers where they want to be met. Engage consumers with a memorable experience.
Product sampling is the most tangible interaction a brand can create. Giving consumers the opportunity to touch and try a product is among the most effective ways of accelerating awareness and communicating brand value. Digital product sampling allows brands to meet consumers in the omnichannel world. By meeting consumers in the comfort of their home, brands create omnichannel product experiences that build trust, provide education, solicit feedback, and encourage subsequent purchase intent. Further, digital sampling ensures that every sample is delivered to a high potential consumer, driving effectiveness of the tactic, and resulting in increased engagement and conversion.
Amplify the Message for Continued and Exponential Growth
Brand advocacy is a gold standard marketing strategy. Activating a brand’s loyal users to make recommendations has the benefit of trust, relevancy and efficiency. User Generated Content (UGC) is at the core of brand advocacy and it drives trial and volume growth! For CPG specifically, brand advocacy can help brands break through the noise of crowded category segments and amplify the message to drive consumers to existing and new products. Consumers trust the recommendations of others, or word-of-mouth, more than most other forms of advertising.
A brand’s ability to build quality and meaningful one-to-one consumer relationships will directly impact their ability to create and benefit from brand advocacy and the subsequent UGC. Critical to amplifying the message is ensuring the best consumers have been curated into the brand’s social community. Brands that leverage highly attributed consumer data to create high potential audiences and personas benefit from the authentic feedback, ratings & reviews, and social media activity generated.
Privacy Changes Create New Wrinkles
As privacy changes lead to a cookie-less world, connecting directly with consumers has become a challenge at exactly the time when consumers demand personal connections with the brands they support. First-party data strategies have never been more important, yet CPG has lagged in this space, largely due to the fact that historically these products have been sold through third-party distribution channels, leaving brands with limited data about their consumers. This lack of first-party data leaves brands vulnerable, and challenged to effectively create the very type of engagement consumers demand.
Smaller, digitally native CPG brands have created a competitive advantage for their new launches by activating initially via their first-party consumer networks and communities. This targeted launch activity creates consumer demand, helping to “pull” these new brands into physical retail outlets, putting pressure on the shelf space available. A first party data strategy is imperative for all CPG brands as the ability to connect with the right consumers, at the right time, with the right content will influence the success, or failure, of existing and new product offerings.
Omnichannel is the new normal! The success of new product launches is dependent upon a brand’s ability to connect with the highest potential consumers, at the right time, with the right content. Brand awareness and consideration are the critical precursors to trial, yet generating them has never been more challenging. Martech platforms like Sampler give brands the competitive advantage they need to deliver a memorable, omnichannel product sampling experience to the highest potential consumers, while collecting valuable data and feedback to support ongoing consumer engagement and community building.
About the Author
Krista Thompson is an Information Services executive and consultant with BritOn Solutions Group. With over 20 years experience delivering profit enhancing marketing and sales guidance to Consumer Packaged Goods manufacturers and retailers, Krista has a passion for analytics, innovation and business transformation. She is known for orchestrating and leading change, harnessing the power of team and creating value for stakeholders.