“You will work in teams with our clients to develop concrete product improvements in design-to-cost and design-to-market projects and contribute to creating innovative product ideas.”
I came across this job ad from one of the world’s leading consultancies and this was the top point of the job description. In my understanding they want someone to find ways to cut costs and shorten launch cycles.
Where in this description is the value or the relevance of the product, raised?
If you look for a simple definition of what a product is, you will get different variations of “an object/item/merchandise that is intended to meet a consumer need/desire”. Though factually correct, this definition is prosaic and quite far from reality in the modern world.
The most important relationship a company needs to nurture for it to exist is the one between its products, employees and consumers.
In this section, I will discuss the role of products in a company and how they can become a vehicle of long -term future growth if only companies actually focus on them!
THE ISSUE
Do products really meet consumer’s needs?
In everyday life consumers do not know what they want.
When it comes to a truly innovative new category -such as the launch of the iPad- they don’t even know they want it until they see it and 10 years later, they wonder how they lived their lives without it.
It would be more relevant to say that consumers are after a specific result rather than a need.
Marketers are under great pressure to deliver new, more exciting, more innovative (more on this coming up here) products. The company launch plan is very often driven by the results the company is after.
The very nature of launches is to:
Secure more retail space,
Quench the insatiable thirst for newness
and hope that something will stick and become the new favourite.
If the stock does not turn fast enough, a “new exciting launch” is right behind it to make sure the space is not taken away from the brand and given to the competitor instead.
A continuous flow of small firework-like launches, in hope that one will linger longer.
Organic growth takes second stage and the faster consumer trends move, the shorter this cycle, the bigger the pressure on the company to launch new products, becomes.
CUTTING COST: AN ONGOING BATTLE
Everything starts with a product. Without a product, there is no company (ok you need other things too but this is one of the business cornerstones).
The product should be the crown jewel.
Yet in their effort to cut costs and improve margins, products are subjected to unimaginable abuse, formulation or packaging changes, production development cycle shortening, lack of consumer safety or formulation stability tests…anything that will shave off time and pennies off the bottom line.
Personal story: “I was responsible for a range of products that had been in the market for a couple of years. At some point after the products had been in the market for a while, we started receiving consumer complains about adverse reactions to the products. R&D confirmed that they had not changed the formulation, production confirmed nothing had changed in the production process, logistics swore by their method of delivery and so on. After months of discussions, deliberations, process reviews and everyone’s efforts to dodge the bullet, during a coffee break in the kitchen over a casual discussion with a colleague, I found out that there has been a change in the supplier of certain raw materials. The raw materials were exactly the same in specifications so there were not put though all of the thorough product testing usually done pre launch, but the supplier was cheaper. Sure the company saved some Ks €, but imagine what the cost for the company’s reputation in the end.”
Over the years, I have sat in numerous meetings discussing x retailer who is not happy with the results of the brand (without having previously communicated a clear expectation or measurement of success) so “we have to relaunch / give them something new / assure we don’t lose the space”.
At no point has the product been part of this discussion.
How do you make the product the focal point of the discussion? Keep on reading here!