Thinking out the box: a new approach to product development

Business Horizons, May-June, 1995 by Primo Angeli

New products are the lifeblood of the marketplace--and of every successful brand marketer. American companies turn out 20,000 new products each year; unfortunately, about eight out of ten of them fail. Considering these numbers, one thing becomes clear: The traditional approach to new product development followed by most brand marketers is inefficient. With a failure rate of 80 percent, it is also too costly. There has to be a better way.

For the most part, companies today continue to manage their new product development process much as they did in the 1950s, 1960s, and 1970s. This is despite today's tougher, more competitive marketing environment. They focus on developing products that are extensions of their existing product lines, that build on brand loyalty and reflect the company's accepted manufacturing and marketing strengths. There are limits to brand extensions, however. Coca-Cola works as a soft drink, for example, but is not successful as a fruit juice.

In our quest for a more efficient way to create products that can compete effectively in the global market, we recognized the limits of line extensions. Going beyond these limits, we took a new direction based on an idea that had been percolating within our marketing design organization. The idea was rooted in the reality of the packaged goods marketplace, where the consumer sees the product and the package as one. Our experience, supported by marketplace research, indicates that the consumer does not conceptually strip away the packaging and consider the actual product when making a buying decision. For instance, in the case of food and beverages, the package communicates a promise of quality, taste, and enjoyment, and the consumer expects the product inside to measure up. If it does not, or if the package fails to deliver on the product's promise, another product failure is the likely result.

If the package is in fact the product, what would happen if we reversed the traditional product development process? What if we created a successful marketplace package first and then had R&D develop the promised product to fill it? We decided to explore and develop this new approach, which we named RapidAccess[TM]. Since package design is traditionally the final step in the conventional process, it could be said that RapidAccess would turn new product development upside down.

This was no flippant proposal. As experience has since shown, RapidAccess offers major brand and marketing managers an opportunity to increase the number of viable concepts for products at an early stage. Marketers can thereby obtain the truest consumer feelings about the products well before the heaviest investments are made, thus significantly cutting development costs.

One very real advantage is that RapidAccess allows companies to take previously uncharted paths with relatively little risk. Marketers can explore new product directions and measure response and reaction to them without incurring sizable investments in extensive consumer research, R&D, and sample goods production and testing. Much of the product experimentation and development is carried out and visualized in the initial design stages with realistic, highly finished package prototypes rather than in the processing plant or in R&D laboratories. As a result, considerable savings can be achieved.

The process focuses immediately on creating an effective point-of-sale package--made possible by new computer technology--that communicates with and appeals to consumers. Currently the methodology works mainly in the areas of food, beverages, household items, and cosmetics-those areas in which the package is important to the sale of the product--areas in which, as far as the consumer is concerned, the package is the product. Strong point-of-sale product support has become increasingly vital to brand marketing success in the 1990s as the retailer's dominance and control of the retail environment and marketing channels grow.

Furthermore, RapidAccess provides manufacturers with a fresh, innovative point of view that breaks the mold and leads to the creation of products that go beyond the standard line extensions of the traditional management approach. According to one veteran new product developer, says Howard Schlossberg (1993), American business has been stuck in a no-risk mode too long.

Because RapidAccess avoids targeting any specific product direction or category, it can overcome the unwritten rules and product taboos that develop within a company and hinder innovative development. RapidAccess can branch out in any direction to create new brands and new product lines.

KEY STEPS TO NEW PRODUCT DEVELOPMENT

Although RapidAccess might be considered a radical departure from previous new product development, there is a clear logic to reversing the traditional way of bringing a product to market. RapidAccess focuses on the real role of packaging in the marketing of new products. Packaging is not simply a pretty wrapper but the all-important shelf medium that must communicate with the shopper. Additionally, RapidAccess transforms packaging into a creative catalyst, inciting and activating the development of new products.