Why do products fail?

By Dr. Keith Ewart

One of the biggest challenges facing Companies is the rapid turnaround and churn of new products in the marketplace.   In 2014, Nielsen reported that 85% of new fast-moving consumer goods (FMCG) products fail in the marketplace.  A recent McKinsey report highlighted that while 84% of executives agree that innovation is critical to their business, only 6% were satisfied with their innovation performance.

Why are products failing to meet consumers’ needs and/or failing in the marketplace ?

Were these products tested with real consumers or just launched?  If they were tested, were they tested realistically?  Were they tested with a broad set of consumers or a specific target group?  If they were advertised, was the advertising tested?  Were the assumptions on distribution, shelf location, etc. all realized?  If there was an influencer strategy, was this implemented effectively?

These questions are only part of the search for reasons why, but you can see that there are a number of factors to take into account.  Is there anything we can do to reduce this failure rate?

Test Early – Fail Fast

I am a massive fan of Fail Fast, Learn Quickly and believe in the idea of prototyping quickly and early in the development process.  This can be an early sketch of an idea, a working prototype of a product or a service idea.  The key thing is to understand if you have really delighted your consumer or is it another “me- too” product/service.

This consumer delight can be determined in a number of ways.

  • How would they describe it to a friend – are emotive words used, is there a sense of “Wow”?
  • If they had to provide a video testimonial, what would they say, who would they recommend this product to – is it close friends and families or more distant individuals?
  • If you re-contacted them a week later would they remember the product and/or experience?
  • When you take the product or experience away, how do they talk about returning to their old product or experience?
  • What implicit first impressions do they have – what is their gut feel?

Collaborate with multifunctional teams as early as possible

Often, innovation will start with Insights or Market Research teams identifying an unmet consumer need, or identifying a new consumer or technical trend.  For larger organisations, designing the ideal consumer experience may occur internally or be briefed to an external design agency or consultancy.  Some of the most powerful sessions I have been involved with were where the internal team R&D experts and Sales & Marketing were all in the same room as the design agency.  The real power is combining the creative flare with the technical experts.  Another key to success is to encourage teams to broaden their thinking and not pre-judge whether ideas are “manufacturable” or even feasible.  Proposals can be rated and ranked to identify top ideas but a key tip is to allow everyone a vote for the most wacky idea and/or the ones that they have the most passion for.

Keeping momentum for ideas that may be game changers

Breakthrough ideas that are truly disruptive are often dismissed after small-scale testing with current users, because they can be considered too new and different.  Likewise not all senior management may be best placed to judge what constitutes a breakthrough idea, so I would advocate using “forward thinking category users/early adopters” for small-scale testing or larger scale quantitative screening to determine if there are “passionate lovers” of the idea.   Hearing and seeing passionate consumers talking positively about their experience can help maintain momentum.  It is important to video and record these experiences so other team members can see this for themselves.

With CloudArmy Implicit testing we have found there is usually a normal distribution for associations of attributes to a particular idea.  Exploring and understanding those individuals with the strongest associations can reveal more insights as to potential prime prospects or target consumers.  Likewise, if explicit test data for a particular idea is polarising, this can be a really strong indicator of a great idea.  In some categories, using Top Box ratings score can be a better indicator of a WoW experience than looking at average scores.

If you believe in the idea and you have the compelling evidence suggested above then a next step is to consider all the consumer touchpoints.  A great product or service experience can be destroyed if all the touchpoints are not great.  Also, seeking input from external partners in your own organisation and beyond is a good way to flush out any issues and provide reality checks.

Be prepared to let go

If your rapid test ‘n learn data is telling you that your idea is not a WoW then you need to call this out.  Too many teams keep driving an initiative through, knowing that their solution is just a me-too or minor tweak.  Sometimes products are still launched even though the final Market Research modelling indicated that the product is a bottom quartile on Distinctivity.

 

If we can help you test ‘n learn more quickly and cheaply with the CloudArmy Reactor platform, please send me an email (keith@cloud.army)

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