The Customer is always right
Getting it right for the customer depends on identifying the right customer and delivering the right product, in the right locations with the right messaging. Retailers are increasingly mission-focused so the need for brands to demonstrate to the retailers who they are targeting, and why, is proving to be essential to getting listings. Using data and insights to demonstrate this is becoming more important across the industry and research has shown that the brands that use it to make more evidence-based decisions have much greater success.
Successful NPD the five-step way
Here are five critical factors to consider in fine-tuning your approach to launching NPD; the who, how, why, what, and where of New Product Development:
1) Who is your target customer?
It’s vital to develop a detailed understanding of who your target customer really is. Assumptions based on ‘mass market’ observations are no longer reliable in the way they once may have been; when there was more uniformity in behaviours and less expectation from the customer of a brand’s ability to align its proposition to the customer’s lifestyle. For existing brands this may mean developing products which appeal to new customer groups. For new brands, it is about ensuring you really know who your product is aimed at. Successful launch strategies are based on helping retailers to understand how your product will help them to appeal to store catchments, stretching their appeal to your target market and demonstrating that you understand the real size of the opportunity.
2) Where are your target customers?
The most successful brands don’t just look for top level insights; they go down to local markets and store level analysis as was the case in our work for Propercorn. Understanding locations gives a brand a stronger edge in generating listings.
What really drives your sales? What is the right location type, the right store type, and how do you want to engage with customers?
Trialling, promoting and securing listings in the right stores gives a brand the best chance of success.
It’s not just about where your customers live either.
Where do they shop, work, socialise and what transport do they use?
3) How do your target customers shop?
Developing the right product, pack sizes, functionality are all core success factors. Decisions on the balance and weighting between them are key to success and can be informed by answering questions (through careful analysis of the data) such as:
- How frequently do they shop?
- What missions are they on?
- What purpose does your product serve in your customers’ lives?
Competition for shelf space is increasing, and retailers look to ensure their range serves an insights-driven mission. For your product to engage with a consumer’s lifestyle, analysing consumer behaviours will make a significant difference to its success potential.
4) Why do your customers behave like they do?
Deeply understanding your customer is more important than ever before as a result of these pressures. Understanding the motivations behind why consumers shop and act in certain ways adds another level of competitive advantage.
What is it about your brand that excites them? What are their attitudes, lifestyles, values?
The answers to these questions will help you to develop the right emotional appeal and image, the right balance of complementary elements within your marketing activities, and the right packaging constituents from design through to information.
5) What do your customers buy?
There are two considerations when it comes to what your consumers buy: the brands you compete with, and brands that are complementary. You can bolster your chances at success by looking for complementary brands which serve similar missions.
Who could work as an effective partner for a promotion?
It is clear that understanding the competition will be important. Understanding how own-label interacts with this is even more important. Being in a place where your brand competes with own-label options is an enormous challenge. While ensuring differentiation from the competition is critical, such endeavours are made easier by finding a gap in the market. One of the UK’s fastest growing snack brands, Propercorn sought to identify high potential convenience stores by location or “opportunity gaps” that were likely to generate the largest success and return on their investment. CACI delivered detailed analysis on how Propercorn compare and contrast to competitors in their space, to inform who to target, where they are, and how to reach more of them. This information helped them to drive distribution by identifying the best locations for the brand, city by city, based on localised consumer behavioural analysis.
The key theme throughout is the customer. In today’s fast-paced retail environment, the customer verdict on your product will be delivered quickly. . Understanding firstly who they are, their motivations, behaviour, how your product will serve a purpose in their lives, is critical to NPD success.
Once this information is gathered and interpreted it not only forms the basis of your NPD strategy but also informs a logical and compelling sell-in story to take to retailers.
If you’re interested in continuing this discussion and finding out more about the power of data-driven insights to create successful NPD strategies please feel free to contact me at: gfeare@caci.co.uk.
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