How to optimize your product innovation

The recent report from McKinsey on whether innovation will finally come good for CPG companies starts with the somewhat grim statement:

“In response to the damage and overnight transformations due to COVID-19, multiple consumer companies have recently announced cutbacks in their innovation pipeline.”

There is also a pre-existing condition contributing to the overall ailments in NPD: The drumbeat of retailers reducing SKUs. This was gaining volume even before the pandemic, with brands fighting product line rationalization and revenue contribution demands.

Whilst it may be tough to track down the data validating the urban legend that 85% of all new products fail, McKinsey draws a dire picture of innovation reality:

Time to fold up the innovation tents?

Now hold on a second. 

There are 6 Ps that marketing scientists generally acknowledge as the key metrics for product success: Price, Place, Promotion, Product, Pack, Proposition.  

Post launch success is rooted in measuring and optimising each of these.

Brands need to understand how aware people are of their product - did the campaign work? What do they think of the pack, price, proposition and product itself? How easy was it to find? Would they buy it again?

Yet, this is when most brands put fingers to the wind and guess, rather than measure and validate.

And they’ll often pay the delisting penalty. 

As the McKinsey report implores:

“It is critical to measure, simplify, and manage innovation performance differently and more effectively. To identify the true impact of innovation, marketers need a strategic and fact-based view.”

A strategic and fact based view is also something that needs to become ingrained in the innovation process:

“A disciplined approach allows companies to institutionalize the process of learning and incorporate lessons back into strategic planning. Most importantly, it can shift organizational mindsets toward a relentless focus on ensuring that innovation works.”

As brands take on the McKinsey prescription for overall innovation performance optimization, the last mile of post-launch validation is an imperative.  

Our Post Launch Consumer Review was co-created with our clients to help with exactly that.

Strategic recommendations and supporting films across the 6Ps based on observation of people shopping for and using/consuming your product. All at a cost that could almost be a rounding-error in your budget lines.

Want a strategic review of your innovation to protect against delisting? Let’s chat.