One, two, three, four and you have a brand breakthrough claims research giant
THREE of every four new fast moving consumer goods (FMCG) products fail in the first year of launch, according to international market research company Nielsen.
But it seems that needn’t be the case. The research firm acknowledges that launching a new line often ends badly but it claims its studies have unveiled the four keys to success.
The research analyst looked at 12,000 FMCG product launches in Europe since 2011 – 76% of which failed within a year – in a bid to crack the DNA of new product development success.
The Nielsen Breakthrough Innovation Report found that only five of the products in the study that were launched in the UK could be deemed a success – generating at least £10m in year-one sales and maintaining 85% of those sales in year two.
The UK success stories, found in a variety of categories, were Foster’s Gold, Magnum Infinity, Mullerlight Greek-style Yogurt, Lucozade Energy Pink Lemonade and Oral-B Pro-Expert All-Around Protection.
In addition, two more British launches – Cadbury Dairy Milk Marvellous Creations and Ariel 3-in-1 Pods – are said to be well on the way to hitting the brand launch heights.
According to the Nielsen research, marketers can predictably and consistently overturn historical high failure rates to achieve 85% success, by changing their approach and building a passionate culture around innovation.
“Through the study process, we found proof that innovation success is never just a remarkable coincidence,” said Johan Sjöstrand, managing director of Nielsen’s innovation practice in Europe, and co-author of the report.
“It’s about deliberate attempts to disrupt all aspects of the innovation process and challenge everyday norms, such as consumer attitudes, long-standing beliefs, launch mechanics, organisational behaviour and disciplines.”
The Nielsen study identified four principles that researchers said were common to every breakthrough innovation success:
1 Choice – the innovation must be the right one to pursue. That can be found out by asking questions like, why don’t people use a category? What causes them stress, confusion, inconvenience or compromise?
2 Process – the product has to be properly prepared for the market, with weak ideas filtered out before launch.
3 Marketing – creative marketing has to be original and has to tell the story of the innovation.
4 Togetherness – for breakthrough success, the product has to have the full support of the company and customer
Sjöstrand said: “The absence of any one of these four components – no matter how good the other three – severely limits the possibility of breakthrough success.”