30 Jun, 2022
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Mat Lintern, CEO
10 Oct, 2017 | 2 minute read
Big brands might not be dying, but plenty are struggling with their new product development
Reading this article from Ehrenberg Bass reinforced my belief that, whilst big brands might not be dying, they often miss a trick when it comes to NPD.
As the article points out, the big boys have inherent advantages over the smaller players, who are increasingly stealing their share with more focused and targeted FMCG products. But frequently they fail to leverage this advantage fully, or even at all.
As a small player it’s not easy to succeed in launching a new product, but it's relatively easy to retain focus. Personal futures are dependent on making the product a success, so it’s not surprising that a razor sharp vision forces natural consonance across the offer (think Ella's Kitchen, Fever Tree, Brew Dog or Kind). You’re the driving force, there’s no-one pulling you in a different direction, it’s your baby and the story's 100% straight in your head.
But this is rarely as clear-cut in a larger company. Often they start the process well enough, with an effectively ideated proposition, focused on the needs of a clearly defined target consumer. But from there on things typically get confused. Different departments (and country teams) want their say, research hurdles need to be cleared, often forcing a focus on breadth over strength of appeal, and gradually you find that nice tight idea gets diluted down, as you're forced to make it 10% more appealing to 50% more people, in turn becoming 50% less appealing to the 10% most likely to be core buyers! Then, as launch approaches, we add in cost of goods challenges, standard category management processes, supply chain complications, and the whole thing gets a lot less focused than it would be in a start-up. But - and this is partly why failure rates remain stubbornly high - a lot more likely to actually make it onto the shelves.
It’s not just in NPD where we see this; look at many of the big brands struggling for growth, and you’ll find something a little tired, coherence and clarity reduced by cost reductions, questionable line-extensions, or the efforts of successive brand mangers each determined to leave their stamp. There are many fading giants that would benefit from a stop and think, a slimming-down and an adherence to sensory branding principles to ensure they fall back in line with their central narrative.
As Ehrenberg Bass preach, being big can be a huge advantage, physical and mental availability do drive scale. But being big, especially from launch, is only a long-term advantage if you stay true to your roots, and that often means thinking small – back to that start-up mentality and laser-like focus. Ask yourself if your new product development processes allow you to do this, and if not perhaps it’s time to think again.
Traditional volume estimation approaches might be an accurate predictor of short-term sales, but do they allow those killer ideas, that often need time to grow, to survive in a big company NPD research environment?
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