New Product Failures

Poor Execution
Products that do not deliver as promise
Lack taste and texture
Packages that are difficult to open
Deteriorates before expiry date
Extends to all areas of marketing plan
Insufficient advertising, poorly scheduled launch, fails to
reach targeted consumer, fails to communicate product’s
name, benefit, and availability
 New Product Failures
Poor Execution
Introduced too late
Introduced too early
Campbell’s Intelligent Cuisine
 New Product Success
4 Basic Consumer Truths
Product needs to deliver on the concept promised
Advertising quantity and quality matters
Distribution drives sales
Long-term support for new brands are needed
 New Product Success
Other “truths”
New items adds incremental euros and profit to both
category and brand
Enhances manufacturer’s and retailer’s position
Launches are carried out with minimum disruption
 New Product Success
Other “truths” cont.
Accompanied by product service plan and consumer
target plan
Identification of activity-level costs

These are the back-end of the development process

 New Product Success
5 most important factors in distinguishing between a
product winner and a loser:
1.Understanding of user’s needs
2.Attention to marketing and launch publicity
3.Efficiency of development
4.Effectiveness use of outside technology and
external scientific communication
5.Seniority and authority of responsible managers
 New Product Success

The development of a new product is the

development of every aspect of the business that
the product needs to be successful
Consistently successful new products need every
aspect of the business working in harmony
 New Product Success
12 Requirements that are needed for a
product to be successful:
1. Appropriate organizational environment and top management
support
2. A disciplined new product development process
3. Dedicated development teams plus the willingness and ability to
partner and outsource
 New Product Success
4. Product development activities that start with and flow from
business unit strategy
5. Understanding the external environment and identifying market
opportunities that fit core competencies
6. Identification and specification of what is driving the consumer and
what the consumer wants
 New Product Success
7. Processes and techniques for keeping the pipeline
filled with a wide variety of product ideas
8. Clear and focused product definition early in the
process before development work begins
9. A superior and differentiated product and package
 New Product Success
10.Use of research to measure reaction to the product
and all elements of the program throughout the
development process
11.A well-executed launch
12.Ability to adapt, grow, and improve as market and
competitive condition evolve
1. An appropriate organizational environment and top
management support
•Nurturing of innovative thinking
•Support risk taking
•Ability to sustain losses from first to third year
•Committed to putting right team together with
adequate resources
2. Use of a disciplined new product development process

Need for completeness, consistency, and proficiency

Realistic but disciplined timetables

Proper up-front planning is critical

3. Dedicated development teams plus the willingness and
ability to partner and outsource
Use of cross-functional teams
Enhances speed to market
Facilitates implementation of projects
Food processors are using suppliers expertise and
resources
Manufactures are partnering with each other and with
suppliers
4. Product development activities that start with and flow
from business unit strategy
Product development must be a part of overall business unit
strategy, stemming from clearly articulated objectives for
business growth

Financial and human resources must be available

5. Understanding the external environment and identifying market
opportunities that fit core competencies
• Identifying “gaps” that are created by changing
consumer tastes that are driven by changes in the
marketing environment
• Demographic, socioeconomic, and lifestyle changes

• Advances in technology
6. Identification and specification of what is driving the
consumer and what the consumer wants
Unsatisfied consumer needs represents potential new product
opportunities
Understanding customers needs, wants, and preferences
E.g. Pre-cut salads
7. Processes and techniques for keeping the pipeline filled
with a wide variety of product ideas
Consistently identify and screen a large multitude of new
ideas through a systematic process and set of techniques
E.g. Kraft Foods
Ideation requires encouragement and reward for creativity
and excellent market intelligence
8. Clear and focused product definition early in the
process before development work begins
Need to identify target market, product concept
and positioning, and consumer benefit to be
delivered first
9. A superior and differentiated product and package
A superior product must be:
innovative, possessing unique features, meeting
customer’s needs better, delivering higher relative
product quality and solving the customer costs.
E.g. Frito-Lay’s Baked Lays (oven baked potato crisps)
10. Use of research to measure reaction to the product and all elements of the
program throughout the development process

Continuous market studies

Continuous refinement and evaluation of product

Thorough testing of product

 11. A well executed launch
Defined as:
setting specific goals and targets for market performance
running initial production, distribution and selling it to the
trade
implementing the advertising and promotional programs
tracking all of these activities relative to goals and targets
 11. A well executed launch (cont.)

Success measured in 4 key areas:

Production and distribution
Sell-in
Consumer reaction
Overall performance
Launch must be tracked to determine success
12. Ability to adapt, grow, and improve as market and
competitive condition evolve
Firms plan to ensure market success via contingency planning and to
continuously improve the product bundle
Establishing scenarios of market and competitive reaction
Monitor reaction
Having alternative strategies available
 Failure
• Coca-Cola Blak
• Coke developed this coffee flavoured Coke in 2006 but it was discontinued in 2008.
• It was a mid-calorie drink that was launched in France and later in the US and Canada.
• It was marketed as an energy drink that was for sophisticated adults and students to help
them during exam time by giving them the extra boost for studying.
•
• "It is not for everyone," Coke marketing executive Katie Bayne told The Atlanta Journal-
Constitution when the drink was launched in April 2006. "It is an adult cola taste.3
•
• The idea was right and the product seemed to sell well in France after a successful launch
but Coke use a slightly different formula which was more sweet as sweeteners were used
in the US which didn’t seem to go well with the coffee flavour so the product failed
mainly on taste alone as it relied heavily on being a success in the US.
Coffee Coke
 Colgate Beef Lasange
In the 1980’s when frozen tv dinners were very popular, Colgate decided to try their hand in the
market but found out that just because you have a successful brand doesn’t necessarily mean
that it will succeed in another category.

Their concept was good and they just tried to jump on the tv dinner craze but they fell short on
marketing as if they had properly done it they would have discovered that the brand is too well
known for toothpaste products and it makes people uncomfortable to mix the idea of the two.

They weren’t breaking the mould with this move as they just jumped on the bandwagon of the
popularity of tv dinners at the time but no matter how good a launch plan that they had it was
cemented in the consumers brains that they didn’t want to eat something made from their
toothpaste manufacturer.
 Heinz EZ Squirt
• In 2000 Heinz decided to take advantage of the popularity Shrek movie to
make a novel line extension by adding EZ squirt green colored ketchup to
its successful normal ketchup range.
• This boosted sales for a while as the movie was still fresh in the memory of
kids and adults but they left it 2 years to add another color in purple and
the novelty had worn off at that point.
• Also parents had become more aware of food that contained artificial
colorings and the EZ squirt brand was pulled from the shelves in 2006.
• As time goes by people seem to more aware of good and bad foods and
want to go back to eating real food and try to avoid unnatural tasting and
looking foods!
 Success Flahavan’s Porridge Quick Oats
• Flahavan’s noticed the shift away from porridge oats as they weren’t
convenient enough in today’s fast moving world so they developed
quick oats that can be made in the microwave in 2 minutes and still
have the same great taste as normal oats.
• This was a genius move as it completely modernized their brand to a
new health conscious market that may not have access to a full
kitchen at work. Porridge is no longer seen as something that old
people ate years ago and even though it has to be microwaved it is
healthier than having a breakfast roll or a full Irish for example.
 Wyldsson
• Dave McGeady lost his job in 2012 due to economic downturn and started Wyldsson, a sports nutrition company that
aims to stand out from the crowd by not looking for attention.

• Most of the healthy snacks available were not good and contained a lot of added sugar. He used high quality
ingredients that taste good in their natural state.

• He sold his products directly to the consumer to cut out the high margins of the retailers.

• He let word of mouth sell his product and gave athletes exactly what they wanted from a snack by making it as clean as
possible but still a treat.

• He saw a gap in the market for a natural product that needed to be convenient to access when on the move or training
or even playing golf, and he has since done some research in UL in Limerick to focus on the impact of specialized
nutrition on golf performance.
 VIT HIT

• Vit Hit was initally launched as “Vitz” in 2000 by Gary Lavin but failed as
packaging was poor and the initial name of “Vitz” confused customers. It’s
a low sugar, vitamin fortified drink which aimed to be competition for
Lucozade sport and the “work out” drinks on the market.
• Vithit was created because of a lack of healthy drinks available in our
fridges today. ‘Most drinks contain buckets of sugar. Sugar means calories,
and people no longer want calories in their diet’ says Gary Lavin Managing
director and creator of VITHIT
• It goes to show if you try to be too fancy and don’t have an attractive
package that it will discourage the customer from buying the product and
even confuse them.
 Suggested Reading
Wardlaw’s Contemporary Nutrition 10th Edition, Anne M Smith, Angela
L. Collene
The Science of Nutrition, 3rd Edition, Janice Thompson et al
TV Series: Food Unwrapped, Channel 4
Text Book: Fennema’s Food Chemistry 4th Edition
 Bioactive polyphenols
http://www.benecol.com/hidden/plant-stanol-ester-story.aspx