NEW PRODUCT INTRODUCTION – WHY DOES RETAIL EXECUTION MATTER?
The stakes are high when it comes to introducing new products. So much time and money is invested in the research, development, and marketing needed for proper promotion execution, all of which is needed to advertise new products to target consumers.
During the pandemic there has been some dramatic shifts in shopper behavior with less frequent visits and increased purchasing of multipacks. Shoppers have also been forced to consider secondary brands cased by availability issues on the leading brands. These changes in shopping patterns and the implications for brand owners on the importance of availability need to be considered.
The level of failure in new product launches is incredibly high with Nielsen identifying that between 70-90% annually fail in any given year. Many brand owners have reflected on this and analyzed successful launches and attempted to decode the reasons for success. It has been identified that a shopper’s ability to find and buy a new product and then subsequently repeat purchase are critical success factors.
Enlightened retailers are providing suppliers with access to store level sales of data for their own products which can be accessed by a retailer portal. This provides a potential rich source of insight for CPG’s. Algorithms can search for patterns in the data or gaps in sales to infer problems. To do this effectively the frequency of the data, whether daily or weekly, and the granularity of the data are important. Specifically store data by SKU is required.
The growth in digital technology in CPG markets enables directed or guided selling and insights to be provided to field representatives next day. Meaning actions can be taken in real time.
The most obvious solution for CPG companies with investment in field sales organizations will be to ensure their existing resources prioritize addressing new product OSA issues. The second strategy would require head office tracking of rate of sale using the most up to date Electronic Point of Sales Data to highlight store specific issue or provide early warning of performance issues intime to address by adjusting the launch plans. Lastly leveraging big data analytics to identify the store specific issues by SKU to inform smarter deployment of the field team.
To discuss these strategies in more detail, arrange a call with our sales team.
To learn more, download our whitepaper here.
