A couple of years ago, I brought six members of my HomeTrend Influentials Panel to the Housewares Show. I like to bring HomeTrend Influentials (HIPsters) to the show to get their reactions to new products. If HIPsters really like a new product, very likely mainstream Americans will, too. If HIPsters don’t like a new product, mainstream Americans probably won’t like it, either.
We were wandering the aisles of Lakeside Center and a new blender caught our eye because from a distance, it looked really cool. But as we drew closer and got a better look at it, the HIPsters declared that they would never buy that blender, no matter how cool it looked or how many new bells and whistles it had. “Why?” I asked. “Just look at all the crevices around the buttons. Look at how close the buttons are to each other”, one of the HIPsters said, pointing to the blender. The other HIPsters nodded in agreement. “If anything spills out of the blender jar, it’s going to get into those crevices and between the buttons and it’s going to be next to impossible to get the control panel clean.”
Now, I’m sure that the manufacturer of this blender thought they had a winner on their hands. They’d spent months developing the product and hundreds of thousands of dollars on tooling and inventory and they had high hopes. They might have even gotten positive feedback from their retail customers. They were able to get some distribution on the blender, but it never did sell through very well.
Why did the blender fail?
The product failed because the company did not do their homework. If they had done a consumer needs assessment, they would have found out that when a consumer is making a decision on which model of blender to buy, she bases her decision in part on how easy she thinks the product will be to clean. If the blender manufacturer had done a product concept test early on when they were roughing out the product design, they would have discovered that consumers thought that the control panel looked like it would be hard to clean. They wasted hundreds of thousands of dollars on tooling and inventory because they weren’t willing to invest in upfront consumer research.
Tens of thousands of new housewares products are introduced every year. At least half of these new products, maybe as many as 75%, will fail in the marketplace. Because most housewares manufacturers, like the blender manufacturer, are not willing to invest in learning what consumers want and what they will buy.
A high new product failure rate is not a fact of life
Many housewares executives think that it is just a fact of life that half of their new products are not going to meet expectations. But that simply is not true.
In 2003, the Product Development and Management Association (PDMA) sponsored research to discern which new product management practices are associated with higher degrees of success.
The best practices study found that firms that were the most successful or in the top third in their industry success from NPD had much higher rates of new product success. More than 75% of the products commercialized by the “best” firms in the previous five year period had been successful.
There were several key activities that the “best” did better than the rest including doing significantly more market research.
What housewares manufacturers can learn from the PDMA study
Stop treating market research as if it is optional. Consumer market research must be an integral part of the new product development process.
Integrating market research into the new product development process means that you get consumer feedback at certain points in the process.
At a minimum, you should conduct a consumer needs assessment before you start idea generation, a product concept test as soon as you have roughed out product concepts, and another product concept test on the final design before you commit to tooling.
What percent of the new products developed by your company in the last five years would you say were a success?
If that percent is lower than you would like it to be, you should strongly consider incorporating consumer market research into your new product development process.