Kantar TNS’s analysis of 3,500 consumer goods launches* found that 3 in 5 developed into a ‘zombie’ or a ‘cannibal’: failing to deliver long-term growth, or actively eating into the market share of sister brands within the portfolio. Not too unlike the Walking Dead…
How many new product innovations really add value when you look at your whole portfolio?
Market research claims to predict innovation success, yet these figures show how often brands are missing the mark. Most traditional research is still based on an outdated premise of innovation success, and metrics that are not fit to identify real potential.
Kantar TNS believes that only innovation which drives business growth (either top- or bottom-line) should be called a true success.
What does success look like?
Based on business impact, the surviving products were subdivided into 4 categories.
What are the drivers of success?
To identify the metrics which predict true innovation success, Kantar TNS looked at:
- Total sales volume for the new product.
- The percentage of new product sales which were incremental to the existing business.
Each new product was then classified as high or low incrementality on a simple percentile basis.
What they found?
Traditional view: Success = survival
Traditionally, the definition of success has been synonymous with survival.
A more realistic view: Success = growth
When you apply a more stringent measure of success – whether the business/parent brand has grown substantially beyond what would be expected – the interpretation is very different. Overall, only 15% of products launched provided significant growth and could be termed expansion innovation.
Biggest is not always best if you are looking for growth. Indeed, according to Kantar TNS’s Concept eValuate thinking, a new product with moderate volume potential but high incrementality is a much better bet when you are looking for growth than a high volume cannibal.
Usually, the source of volume is considered too late in the innovation process. After millions of dollars have been spent on development and testing, making the call to discontinue the launch is extremely difficult.
Businesses need to screen cannibals and zombies early on to ensure real growth from innovation. Survival is simply not good enough.
eValuateNow is a concept testing tool from Kantar TNS that identifies which concepts have potential to succeed in market and drive growth, in as little as 24 hours. To find out more, visit zappistore.com.
* The study used Kantar Worldpanel data covering all new product introductions in the UK over a four year period across four categories: laundry detergent, savory snacks, soft drinks and skin care.