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Picking Your Lane

Are you making and then backing your choices?

Imagine this as a pitch for a Broadway musical…

“So, what is it all about?”  “It’s about the life of one of the US founding fathers”.  “Right…,very contemporary…so George Washington, Benjamin Franklin?”  “Well, no, it’s actually Alexander James Hamilton”.  “OK, not one of the big hitters then.  What type of music?”  “Hip hop and R&B mainly”.  “Err…well, thanks for coming in, we’ll be in touch”.

The musical ‘Hamilton’ about the life of the US founding father Alexander James Hamilton sounds like it shouldn’t work.  But it does work – really well.  Since opening in 2015 it has sold out every night of its run.  It is already one of the most successful Broadway musicals ever.  In 2016 it received a record 16 Tony nominations, winning 11.  It has set a Broadway box office record for most money grossed in a single week – $3.3m.  It was the first show to break $3m in a week.

Hamilton was created by Lin Manuel Miranda.  He wrote the music, lyrics and played the lead role.  He was already pretty successful, but Hamilton took things to a completely new level.  How did Miranda get here?  When asked by the famous US interviewer Charlie Rose, what set him apart from some of the smarter, more talented kids that he had gone to school with, Miranda answered “Because I picked a lane and I started running ahead of everybody else. I was like “all right, this is what I’ll do”

He picked his lane, started running and at the finishing line (although he is probably far from finished) he had one of the most successful Broadway shows ever.

So, why do we think this is interesting?  Well, we think in our industry we are often worried about ‘picking a lane’.  We often want to appeal to a broad range of shoppers.  We often want products to appeal to a broad range of usage occasions.  We often create broad propositions and messaging.  If you keep things broad, you maximise your appeal, right?

But, what this actually means is a lot of products looking like a lot of other products, all trying to appeal to everyone.  Broadening your audience rarely gives you twice the audience.  In fact, it may actually give you half the audience.  By trying to cover all bases you don’t cover any particular base.

So, how can you make sure you pick your lane?

Pick Your Target User(s).  Who are the core shoppers this store is for?  Who are the core shoppers this brand is for?  Who are the core shoppers this piece of innovation is for?  This is not about saying it is for 20-55 year old females – too broad.  It is not about saying it is for the ‘Time Pressed Tina’ segment – too abstract.  You need to paint a clear picture.

Take Charlie Bighams ready meals as an example.  They are clearly positioned for couples.  These people are pretty middle class.  These people are sitting at a table talking to each other, not sitting in front of the TV.  Bighams are saying ‘if this is you, then we have a great solution for you’.  They are also implying ‘if this is not you, then this might not be the thing for you’.  Having this kind of clarity can often make you feel a bit uncomfortable.  But, if you are feeling too comfortable, you are probably being too safe.

Pick Your Lead Occasion(s).  When is this product for?  When do you want people to be using it?  Often brands are worried about doing this.  If we only talk about a specific occasion, will we limit the product to that occasion?  The reality is that by signposting an occasion you can give a product a clear role.  Shoppers know what to buy the product for and when to use it.  It directs the behaviour, but it doesn’t limit the behaviour.

The classic example of this is the ‘sharing’ occasion.  Lots of snacking products target this occasion.  It gives products a clear role.  This is great for shoppers who are looking for a product when people are coming round or to share in front of the TV.  It is also fine for people who aren’t and just want to buy them anyway.  Shoppers don’t think “they say these are for sharing, it’s just me, so I can’t buy them”.  We all know that many ‘sharing’ products are eaten by 1 person in 1 sitting.

Pick Your Message.  A lot of brands do the previous two steps.  They have a pretty clear view of who they are targeting and the occasion they are targeting.  It is written into brand and innovation plans.  But then it stays there.  The communication that the shopper eventually sees is often not as clear as it needs to be.  This can be the point where brands hedge their bets.

There were probably a lot of nervous laughs when someone on the Marmite brand said “how about love it or hate it”?  But years later if you describe something as a “bit Marmite” everyone knows what you are talking about.  If your product is “perfect for 2” like Bighams, tell shoppers.  If it is perfect for the evening sofa moment, tell shoppers.  If it is the perfect breakfast solution… You get the point.

Picking your lane is not an easy thing to do.  The temptation is to stay broad.  But, as the experts on creating and maintaining habits say “something that can be done at any time, often happens at no time”.

By the way, Hamilton opens in London on 21st December.  Good luck getting tickets.

 

Feel free to forward.  Have a great weekend and speak to you next week.

Jeff B

Focus on What Doesn’t Change

Are you addressing the things that have always mattered?

How often do you get asked about trends?  What are the big things that will change over the next few years?  We get asked it a lot.

How often do you get asked about the big things that won’t change?  We never get asked it.

But that is exactly the question Amazon CEO Jeff Bezos recommends asking.  And he’s built a pretty successful business answering it.

Bezos says that you should build a business strategy around the things that you know are stable over time – for instance, shoppers will always prefer low prices – and then invest heavily in ensuring you are providing those things and improving your delivery of them all the time.

He describes it well: “It’s impossible to imagine a future 10 years from now where a customer comes up and says “Jeff, I love Amazon, I just wish the prices were a little higher” or “I love Amazon, I just wish you’d deliver a little more slowly”.  Impossible.  We know the energy we put into those things today will still be paying dividends for our customers 10 years from now.  When you have something that you know is true, you can afford to put a lot of energy behind it”.

So, Amazon continually lower prices.  They have Prime to speed up delivery.  They have 1 click or Alexa to make ordering more convenient.

Why are we talking about this?  Well, we think much more focus in our industry is placed on the things that will change.  But, much less on the things that won’t change.  For example, lots of new research gets commissioned.  Then people get disappointed when the research comes back and confirms that the things that were most important 3 years ago are still the things that are most important now.

But, imagine if Jeff Bezos was shown some research for Amazon saying that they had cracked price, convenience and delivery, it’s now all about a super premium, experiential, website.  There is a fair chance he’d give a two word answer and it’s unlikely to be “great insight”.

We often want to find new problems.  Because a new problem or need means that we can come up with a completely new solution.  It feels easier.  But, the more important task is to come up with better solutions to the same problem or need.  It is harder, but much more likely to make a difference.  It is what Amazon do.

So, how can you focus on what doesn’t change?

Properly understand drivers of choice.  The key things that drive store choice or drive brand choice in a category.  Then focus your resource on continually delivering.  Measure your performance.  Then improve your delivery even more.

For instance, last week Aldi announced strong sales growth (up 14%) alongside a drop in profits (down 17%).  Matthew Barnes, Aldi Chief Executive, said that they would do “everything and anything” to keep its prices lower than rivals, even suggesting profits may fall again next year.  “We will never take our eye off the ball on price.  We see that as our contract with our customers”.  Aldi know low prices are important.  They want to have an advantage.  To maintain that advantage they will continually invest in price.

Properly understand barriers to usage.  This could be barriers to using a category or sub category.  It could be barriers to using a brand.  It could be barriers to buying or using a product for a particular occasion.  These are things that rarely just go away, so you have to do something about them.

For example, we’d imagine one of the key barriers to drinking bottled water has been taste – particularly compared to what else you could drink.  So, if you are a bottled water brand you add flavour to it.  Hence the massive increase in flavoured waters over the last 5 years.  If you are in ready meals, one of the key barriers could be a perception that they are processed.  So, you remove the processed cues and dial up the freshness cues – e.g. led by City Kitchen, Bighams and now being followed by many other players.

Properly understand key success factors for activities.  The things that were true 10 years ago, are true now, and will be true in 10 years’ time.  For example, premiumisation.  All the evidence says that there are 3 things that shoppers will pay more for (1) something that is better quality or delivers better performance (2) something that is more convenient (3) something that is healthier.  So, if you are trying to drive trade up, a product will need to deliver at least one of these things.

Or take another example – NPD performance in market.  There is a massive focus on trial in our industry.  Lots of new products get good trial.  But trial rarely predicts success.  It is repeat that predicts success.  This hasn’t changed and won’t change in the future.  Most companies know this, but still put most of their effort into getting bought the first time.  Not the next time or the time after that.

Focusing on what doesn’t change doesn’t mean standing still.  It means coming up with new and better solutions to the things that matter.  Always have mattered.  Always will matter.

Let’s end with Bezos – talking about Amazon Prime.  “We want Prime to be such good value, you’d be irresponsible not to be a member”.

Are you as clear and confident about the delivery of your proposition?

 

Feel free to forward.  Have a great weekend and speak to you next week.

 

2017handyman

Getting out of Fixing Mode

Are you addressing problems at source?

How many of you have heard of John Snow?

Not the Game of Thrones character or the Channel 4 news presenter with the loud ties. Both are ‘Jon’ by the way.

We are talking about John Snow, the nineteenth century English physician. Snow is famous for tracing the source of a big cholera outbreak in Soho in 1854. He mapped the incidences of cholera and traced the source of the outbreak to a public water pump in Broad Street. The water supply was polluted.

Snow then mapped other incidence statistics to prove the connection between the quality of the water sources and cholera cases. For instance, he showed that Southwark and Vauxhall waterworks were taking water from sections of the Thames polluted with sewage. They were delivering water to homes, leading to an increased incidence of cholera.

This all sounds obvious now, but at the time it was a big breakthrough. Before Snow, there was something called ‘Miasma Theory’. This stated that the cause of diseases such as cholera was a noxious form of ‘bad air’. It was only by identifying the root cause – stopping people from drinking water from infected supplies, and then cleaning up supplies, that cholera was controlled.

So, apart from giving you a short public health history lesson, why are we talking about this?   Well, we find that a lot of time, resource and energy in companies is spent in ‘fixing mode’. Trying to correct things downstream that are a result of things that happened, or didn’t happen, upstream. A classic example of this is NPD. Things that are decided early on in the NPD process can create problems further down the line – e.g. the pack size that doesn’t fit easily on the shelf.

The problem is that by the time issues have been identified there has been a lot of financial or emotional investment in a project. Often both. So people scramble around trying to solve, or at least manage, problems. But they are trying to treat the symptoms not the root cause.

So, how can you get out of fixing mode? How can you do more of the right things in the first place?

Have the right objectives. A project or activity needs clear objectives – everyone should know what you are trying to do. But, these objectives need to be the right objectives. It is no good having clear objectives if those objectives send you in the wrong direction. Let’s take an example we heard about a while ago.

A brand was developing an advertising campaign linked to a big sports event. One of the main objectives set out in the brief was to “win the world cup of marketing ads”. There was little in there about brand equity. There was even less about driving sales. Which direction does this take you down? An ad that is focused on what the brand really stands for and why consumers should use it? Or an ad that is brilliantly creative that is in the mix for awards?

Unsurprisingly, the ad went down the latter path. It tested badly. Left with little time in the process the team went into full fixing mode. They got a slightly better ad, but one that was way off the one they could have created with the right objectives at the start.

Have a clear portfolio and brand strategy. Know the role a brand plays in the category and the role products play within a brand. Without this clarity we often see two things. First, innovation is developed because it can be rather than because it should be. If there is no real need or opportunity that the innovation has been developed for, category and sales teams have to get into fixing mode – hurrying to create a story to justify why the launch is good for the category and ‘on brand’.

Secondly (partly as a result of the previous point), we see brands with too much range. It leads to more space for brands, but more complexity for shoppers. There are inevitably weaker selling SKUs in the range that come under pressure. So, category and trade teams spend a lot of time and energy trying to protect these SKUs in range reviews. Wouldn’t it be much better to spend that time trying to drive the things that are selling rather than trying to protect the things that aren’t?

Designing from Shelf Back. Let’s take one example – packaging. This is where a lot of emotional energy is invested. Design agencies want to create works of art. They’ve got so much good stuff to say about the product that they want to tell shoppers absolutely all of it. And this is all fine in the meeting room or the focus group when everyone has got a few minutes to look at the pack. But, as we all know, this is far removed from the reality of the shelf.

It is only when someone with a shopper or retail view sees the pack that you start getting a different perspective. But that perspective often comes late in the process. When it is hard to change things. It is much better to have a set of shopper guidelines that can direct things when you are in design mode. Not ones that only come into play when you are in fix mode.

The more time, energy and resource you invest in getting things right up front, the less time you have to spend fixing things further down the line. Don’t treat symptoms, treat causes.

Aren’t we all glad John Snow did that back in 1854.

 

On a separate note, our monthly article in The Grocer goes out in tomorrow’s edition .  There is a link to it on our website… http://www.insight-traction.com/learning-from-coop/

Have a great weekend and speak to you next week.

remember what you are selling 2017

Remember What You’re Selling

Are you focused on what you are actually selling?

“Here to help people in pursuit of their dreams, goals and opportunities”.

We heard this tagline on an advert last week.  What company or service do you think it was referring to?  A leading university, a new self improvement programme, perhaps a big medical breakthrough?  No, it was referring to the “Fly Delta” app for Delta Airlines.

Are people going to use the app thinking this will help me “pursue my dreams, goals and opportunities” or will they use it because it is an easy way of booking flights and tracking flight schedules?  We suspect the latter.   So why not tell them why the app is really good?

This reminded me of a meeting I attended with the marketing team of a Laundry brand.  Before the meeting started they wanted to show the new TV ad for the brand.  So, they played it.  It was a nice film – I wouldn’t call it an advert – about a child and the ambition they had for their life.    As we got to the end of the film, I looked across at the marketing director.  She was crying.

Now, I’m pretty sure that she was crying because of the emotion of the film.  Not because she had just realised that nobody who saw the film would ever remember that it was advertising a laundry brand.  When asked for my reaction I managed a “wonderful, really moving…” and left out the “but not moving any product” that I wanted to say.

Why are we talking about this?  Well, the FMCG industry makes really important products – things that are pretty central to our lives.  If you run out of milk, toothpaste, ketchup or toilet roll, you will want to replace them pretty quickly.

Marketers often want to inject these products with much greater meaning.  They try to go down a couple of levels and give shoppers a much deeper reason for using a category or buying a particular brand.  But do shoppers want the deodorant they buy to help them fulfil their ambitions in life or to stop them from sweating?  Do, they want a wine that is “firm, well rounded, with herbaceous, earthy and charcoal notes” or one that is great with steak?

We are not saying that there is no place for emotion, depth and meaning.  What we are saying is don’t get so carried away with what you could be selling that you forget what you are actually selling.

So, how do you keep focused on what you are actually selling?

Think about who is actually buying your product.  It sounds an obvious thing to say – of course you think about who is buying your product.  But is that always the case?   Do you always pay enough attention to who is actually buying the product?

There are two things we often see.  First, is the tendency to design and create for people like ourselves.  The average project team usually has a very different profile from the end buyer.  It is easy for conversations to be (sub consciously) influenced by what the people in the room would like the concept to be.  Second, is the tendency to think about who we would most like the end buyer to be rather than who it really should be.  The number of products targeting millennials is a classic case at the moment.

Talk to people who are less close to the category e.g. friends and family.  Or people who have less of a vested interest in the project.  They can keep you focused on the true target and what is most important.

Think about the environment in which the product is seen and chosen.  We talk about this a lot.  Your category could be one of 30-40 the shopper is buying on that trip.  Your product could be one of a hundred they could choose from in the category.  There might be 3 or 4 brands on promotion.

You can’t rely on a shopper walking down an aisle, or scrolling down a webpage, with your TV or social media ad front of mind, thinking “I can’t wait to buy product X”.  It rarely happens.  The buying environment is where products win or lose.  It is about standing out and being seen before the competition.   Then the (right) messaging can kick in.

Think about what shoppers most need to know.  There are essentially 3 things a shopper needs to know.  What the product is.  What the product does.  Why the product is good.  This needs to drive the hierarchy of information you present to the shopper.  Once you’ve told them what they need to know, you can then think about whether you tell them how it might make them feel.

One of our favourites at the moment is the amount of brands that are saying something along the lines of “great days start with (insert brand name)”.   Then leave the shopper guessing why their day will be so great if they have that product.  Assuming, they know what the product is in the first place, of course.

Your starting point shouldn’t be what would we most like to tell shoppers.  It should be, what do shoppers most need to know?

Remember what you’re selling.  If you don’t, how can you expect shoppers to?

 

Feel free to forward.  Have a great weekend and speak to you next week.

2017distractions

Getting Distracted By Distractions

Are you focused on the right battles?

How many times a day do you check your mobile phone?

Apparently, the average smartphone owner engages in 76 sessions (i.e. picks it up, uses it, puts it down) a day. These sessions lead to an average of 2,617 touches (clicks, swipes) a day.

How many of you, when you are working on something, and see an email come in, ignore it and carry on working? Not many, we’d guess. And even if you do succeed in ignoring it initially, it will likely play on your mind. You spend the next few minutes trying to stop yourself from opening it. Until…you open it.

Maya Angelou, the poet and author, had a specific way of dealing with potential distraction – which started well before email and smartphones. In every town in which she lived she rented a hotel room for a few months of the year. She insisted on removing everything from the room apart from the bed, a table and chair, a thesaurus, dictionary and bible.

Every morning she would leave her house at 6am, arrive at the hotel and start working by 6.30am. She would work until around 1pm then return home. She would do the same the next day. Then, every day until she had completed the project.

You can’t be distracted if there is nothing there to distract you.

Why are we talking about this? Well, we think there is a lot of distraction in our industry. Particularly, the distraction of “new”. Many manufacturers are very NPD driven. If you ask them what are the big things they are trying to do next year, many will reel off a set of new products. Many of which will be line extensions rather than genuine innovation. Things that use lots of time, resource and energy but often barely make a ripple when they are launched.

Working on this peripheral NPD can distract from where the real battles are. For instance, many brand leaders are being challenged at the moment – by smaller, disruptive entrants, tertiary brands in discounters or retailer own label. These brands are not challenging around the edges. They are not fighting a battle against line extensions. They are fighting a battle against the core.

To win this battle, brand leaders need to protect and strengthen their core. So, how can you do this?

Build and reinforce long term brand associations. Let’s take the Unilever brand Lifebuoy (mostly present outside the UK) as an example. Lifebuoy has focused on one of the simplest, yet most important ways, to promote hygiene – hand washing. In fact they have driven one of the largest hand washing behaviour change programmes in the world. So far, they estimate they have reached 379 million people across 29 countries. Studies show that hand washing incidence has increased from 53% pre intervention to 75% post.

Lifebuoy are still doing it. They haven’t thought, OK that’s the hand washing campaign done, what next? This is a long-term behaviour change that takes time to succeed and they want their brand at the front of it. You know if you join the Lifebuoy team you are not going to be working on a new fragrance variant. You are going to be working on hand washing programmes.

Deliver the right core innovation. Let’s take Heinz beans in Australia as an example. Heinz is launching 4 new can sizes – ‘The Lil’ One’, ‘The One for One’, ‘The One for Two’ and ‘The One for All’. The Heinz name has been taken off the cans to be replaced by these new names. There is a big supporting campaign, based around the animated inventor of the new cans ‘Geoff’.

The pack size ‘innovation’ was probably based around a very simple insight – different sizes for different usage occasions. It is this type of insight that should be driving innovation effort. Not “what flavour can we produce next”, but “how do we make our product relevant to all usage occasions?” As the Heinz ad agency said, in a way that only Aussies can, “this activity is going to sell a hell of a lot of beans”.

Follow the ‘choose me or lose me’ principle. Take the latest Walkers campaign as an example. They are pitting 3 classic flavours against 3 flavours from around the world. For example, salt & vinegar is taking on lime & black pepper. Shoppers are then asked to vote for their favourite. The winning product stays in the range or replaces the other in the range.

Firstly, this is a great piece of activation around the core Walkers brand. But, secondly, it plays to a wider point. Shoppers give you regular feedback on the products that matter – through what they buy. They don’t buy much of the peripheral stuff. If they did, it wouldn’t be peripheral. So, you should focus your attention – time, energy, resources – on the stuff that sells. Not on the stuff that doesn’t sell.

Winning in the current market is about fighting the right battles, with the right ammunition – your heavy artillery. Don’t let distractions get in the way.

Mind you, the guy who has just walked into the coffee shop wearing bright orange shorts, a grey linen jacket and a yellow cravat is testing me. Sometimes, you’ve just got to look, right?

 

Feel free to forward.  Have a great weekend and speak to you next week.

peak end rule

The Peak End Rule

Are you paying attention to how experiences end?

So, most of you will be back from your summer holiday.  How was it?

It was probably quite influenced by how the weather was.  And it was probably even more influenced by how it was at the start vs the end of the holiday.  Great weather at the start, poor weather at the end = OK holiday.  Poor weather at the start, great weather at the end = great holiday.

The technical term for this is the “Peak End Rule”.  This says that we judge an experience largely at its peak (it’s most intense part) and at its end rather than the total sum of the experience.

Psychologists, led by Daniel Kahneman, tested this in an experiment titled “When More Pain is Preferred to Less”.  Participants were subjected to two different versions of a single unpleasant experience.  In the first trial they had to submerge their hand in 14° water for 60 seconds.  In the second trial they had to submerge their other hand in 14° water for 60 seconds, but then keep their hand in the water for a further 30 seconds during which the temperature was raised to 15°.

Participants were then offered the option of which trial to repeat.  The majority said they would rather repeat the second trial.  A slightly less painful experience (marginally warmer water) towards the end meant they were happier for the total experience to go on for 30 seconds more.

Why are we talking about this?  Well, going shopping is an experience with a number of component parts.  The Peak End Rule would say that some parts might be more important than others.

The same can apply to consumption or usage experiences.  We’ve all eaten a dessert that tasted fantastic with the first spoonful, but by the tenth spoonful you can’t eat any more.  Would you order it again next time?  Unlikely.

So, how can you play to the Peak End Rule?

Pay more attention to categories and aisles towards the end of the shopping trip.  Most retailers front load their effort.  The attention (layout, signage, merchandising, display) that is paid starts high with fresh food.  Then it drops down a notch with chilled.  It goes down another notch with ambient.  Then another notch with frozen.  With the exception of health & beauty and alcohol, the shopping experience typically gets poorer as you progress through the store.

If you follow the peak end rule, then some categories may be more important than we think.  Frozen?  Tea & Coffee?  Soft drinks?  Would making these categories easier and better to shop make a difference?  Almost certainly to sales, but perhaps also to overall perception of the shopping experience.

Pay more attention to the delivery experience.  With the growth of online shopping comes a new moment of truth – the delivery experience.   When a shopper is in store they select THE product that they want (e.g. that specific pack of tomatoes).  When a shopper is online they select A product – they click on the link to that pack, then someone else selects the specific pack for them.  The shopper doesn’t see what they’ve actually bought until it arrives.

This is where the additional moment of truth kicks in.  Is it the product I would have picked?  Is the use-by-date good enough?  Has it arrived in great condition?  This is before you even get into substitutions.

All products need to think about this and control for it.  But it is even more important for fresh products, premium products or products that have packaging that could get damaged.  Is your product set up to arrive in the condition you want it to arrive in?

Pay more attention to the end of the consumption experience.  This could mean a few things.  How much time does it take to clear up afterwards?  There are a few things contributing to the decline of the roast dinner, but the time and effort to clear up isn’t helping.   How messy is the consumption experience?  As we eat more on the go, as we eat with one hand and scroll on a smartphone with the other, clean and mess free eating experiences matter.  Want to be scrolling on your phone or tablet whilst eating a packet of crisps?  Me neither.

It is also about positive experiences.  What is the most important part of the experience for a fabric conditioner?  When you take the clothes out of the washing machine and smell them.  This experience is often the difference between getting bought again or not.  What experience are you leaving consumers with, after they have used your product?  Is it the one you want them to be left with?

The whole experience matters – but some parts matter more than others.  Pay attention to what happens towards the end.  Shoppers (sub consciously) do.

In fact we all do.  Watch your team score in the first minute and win 1-0 = pretty boring.  Watch them score in the last minute and win 1-0 = brilliant.

 

On a separate note, our monthly article in The Grocer goes out in tomorrow’s edition .  There is a link to it on our website… http://www.insight-traction.com/learning-from-lidl/

Have a great weekend and speak to you next week.

sales vs awards

Sales vs Awards Mentality

Are you prioritising effectiveness?

Last month the annual Cannes Lions festival took place.

It is marketed as a ‘festival of creativity’.  It is where the great and good of the creative industries get together to give themselves a collective pat on the back.  There are 19 different categories and a lot of awards.  For example, in the ‘Creative Effectiveness’ category there was 1 Grand Prix winner, 5 Gold awards, 7 Silver Awards, 8 Bronze awards and 14 other shortlisted entries.  No wonder the most recent festival lasted 8 days.

We all like winning awards.  Who doesn’t look back fondly on their first swimming badge or first plastic sports trophy?  But, are they all they are cracked up to be?  Do, they reflect the things that really matter?

Well, take football managers as an example.  Each month of the football season the ‘manager of the month’ is awarded to the manager whose team has performed the best or above expectations that month.

Jose Mourinho has won (in England) 3 Premier League titles, 1 FA Cup, 4 League Cups and 1 Europa League.  How many manager of the month awards has he won?  Three.  Contrast that with David Moyes.  He has never won a leading trophy, lasted 9 months at Man United and last season led Sunderland to relegation.  How many manager of the month awards has he won?  Ten.

Would you rather win the awards or the trophies?  Mourino could answer that one pretty quickly.

Why are we talking about this?  Well, we think, the equivalent of the awards vs trophy comparison for our industry is awards vs sales.  And we wonder whether there is too much focus on the former and not enough on the latter.  You can see it in the pack design that could be hung in an art gallery.  Or the tear jerking mood film that no consumer ever sees.  Or the creatively brilliant TV ad that most people don’t link back to the category let alone the brand.

Now, awards and sales shouldn’t be mutually exclusive.  The best activities can deliver both.  However, often they don’t.  Often there can be a tension between what is most creative and what is most effective.  You will not be surprised which of the two we think should take priority.

Creativity every time, right?  Only joking, of course effectiveness is the correct answer.

So, how can you make sure that you have a sales mentality not an awards mentality?

Communicate for Recognition.  This should be the first objective of any communication – pack, POS, digital.  It is key to getting seen in the first place – whether that is on a busy shelf or a busy smartphone screen.  The more you communicate for recognition, the more familiar the visual cues of your brand will be to shoppers.  Meaning the less work the rest of your communication has to do.

To do this you need visual consistency – in communication through the line and over time.  We, in the industry, get bored much quicker than shoppers do.  And creative agencies get bored much quicker than we all do.  Whenever a brand thinks it has problems, the answer seems to be to change things and come up with something new.  But, the right answer is usually to dial up and reinforce what you’ve got.

Be Explicit not just Implicit.  Often the most creative work is based around implicit associations.  They are usually very clever.  However, you often have to be very close to the brand or communication to pick them up.  This is fine for the team working on it that see everything multiple times.  It’s not so good for the shopper who might see the communication once, at a glance, whilst on the move.

We are big fans of ‘telling’ not implying.  It could be telling the shopper what the product is.  Not always obvious.  It could mean telling shoppers where to find a product in store.  Not always obvious.  It definitely means using very simple, everyday language.  Are you going to win an award for doing this?  Unlikely.  Will it drive sales?  Probably.

Develop Scalable Solutions.  We’ve all seen the conference presentation with the great new shelf layout, signage and fixturisation.  They look great.  And they would look great in store if they were implemented in enough of them.  But most aren’t.  The key to any scalable solution is being (a) easy enough to implement (b) cost effective to implement.  When it comes to creativity vs implementation in retail, the latter will always win.

This doesn’t mean you have to develop simple, boring stuff.  It means thinking about different potential solutions.  It means thinking about different levels of solution (e.g. gold, silver, bronze).  It may be that different stores implement different levels of solution.   That is OK.  Often manufacturers rely on one solution – usually gold.  It then becomes a “yes or no” decision on whether to implement.  “No” typically wins.

Ultimately, it shouldn’t be about creativity vs effectiveness.  The two can and should work together.  However, when it comes to choices, never lose the sales mentality.  That is what really matters.

Jose Mourinho is manager of Man United.  David Moyes isn’t.  There is a clue there.

 

We’re going to take a short break from writing Blogs over the summer, and will be back on 8th September.

For those of you going away, have a great break and speak to you on the 8th.

 

seeing the bigger picture

Seeing the Bigger Picture

Do you really know what is happening?

You know the story about the frog in a boiling pot, right?

If you suddenly put a frog into a pot of boiling water, it will jump straight out.  But, if you put a frog in a pot of tepid water, then slowly bring the water to the boil, the frog will not sense the danger and will be slowly cooked to death.

Plenty of scientists have debated whether this is actually true.  Some 19th century experiments suggested it was true as long as the heating is sufficiently gradual.  Modern biologists say it is false – a frog that is gradually heated will jump out.

Does it matter?  Not really.

The point of the story is that small, incremental changes are often unnoticeable (the frog stays in the pot).   However, these small changes can lead to big impacts over time (it is cooked to death).  The story can be applied to many things in life, like the effects of global warming, the lead up to the 2007 financial crisis, how to treat drug addiction – gradual withdrawal rather than cold turkey.

Why are we talking about this?  Well, we often see this story playing out in our industry.  You look at things regularly – weekly sales, monthly share reports, quarterly brand trackers.  These things show you small movements – the equivalent of a gradual increase in the temperature of the water.  But, when you keep looking at the small changes you can often miss some of the big things that are really taking place – the water is now boiling.

For instance, over the last few years each monthly increase in discounter market share was small.  Step back and it becomes big.  Monthly declines in fruit juice sales were small.  Step back and it is a significant drop.  When promotional intensity was increasing, each extra price promotion was small.  Step back and some brands were selling most of their volume on deal.

The big problem is that by the time you realise it’s 20° warmer it can be too late to turn the temperature down.

So, how can you stay aware of, and act on, the changes that matter?

Know the consumption and usage trends.  For example, are more or less people eating breakfast now?  What things are they eating more or less of for breakfast?  Are more people snacking?  When are they snacking?  What are they snacking on?  This often means looking at things over a longer time period – the monthly movements in potato vs rice and pasta consumption are small.  Chart this over 20 years and the movements are huge.

This often means looking outside your category.  You might know the consumption of your category has been falling, but that consumption is likely to be going elsewhere.  Where and why?  It also means properly understanding trends in your category.  This isn’t as obvious as it sounds.  We’ve seen categories and brands that think the figures are healthy because value has been going up, without realising that volume was in significant decline.

Follow (& Lead) the Trends.  Too often companies try to protect their current business.  We talked about this last week.  You operate in a particular category.  You are set up to produce certain products.  So, you make what you can make.  This is why many brands have taken so long to adapt to the health trend.  They fight it for a while – some clever NPD, more promotions.  But, eventually they have to respond.  The problem can be that everyone responds at the same time – think ‘Thins’ in the Biscuits category at the moment.

It is much better to swim with the tide.  If consumers are changing what they eat, how do you adapt what you make?  And how do you ensure you get first mover advantage.  Belvita did it in breakfast biscuits.  Graze are doing this in healthy snacking.   You help establish the sub category and you win disproportionately as a result.

Decide.  Then Hold your Nerve.  It can be seen as less risky to sit back and see how things develop.  However, it is often more risky.  If you wait it can either be too late or a competitor has already stolen a march on you.  Take Discounters – many manufacturers took a long time to decide on whether to play there.  The longer you wait, the more sales you miss and the more chance a competitor gets in there before you.  Not a big problem when Discounters have a 5% share.  A much bigger one when they have 10%+ share.

It is also crucial to hold your nerve. You might see a loss early on – e.g. investment in factory capability for a new product.  Or you might not see an immediate return – e.g. investing in eCommerce.  However, you are often investing now in order to build an advantage in the future.  If you are following the right trends, have confidence it will pay back.  A small advantage now could become a big advantage over time.

To act on the right things, you need to properly understand what is happening.  To do this you often have to take a step back.

To understand how warm the water is and whether it is getting warmer.

 

Feel free to forward.  Have a great weekend and speak to you next week.

innovation

Should vs Could – The Right Approach to Innovation

Are you making what you can make or what shoppers want to buy?

Last week we were at a festival.  The Jacksons were headlining on the Saturday.

For the first 40 minutes or so they were superb.  All the old hits, the co-ordinated dance moves, they were rolling back the years.  Then there was a short pause – images of Michael on the screen, quick costume (well jacket…) change and then they were back on stage.  The crowd fired up for more of the same.

Then Tito Jackson told the audience he was going to play his new single.   And told us it was from his new album.  Three times.  He then played a pretty average song that nobody had ever heard before.  Cue a big drop in the energy of the crowd that never really recovered, even when they went back to the hits later.

Paul McCartney summed this effect up well last week “when I do a new song it’s like a black hole.  But, when I do another Beatles number the audience lights back up”.

Tito Jackson wanted to play his new song.  But the crowd didn’t want to hear it.  That wasn’t what they had come for.

Why are we talking about this?  Well, we think in our industry we often make the products that we can make.  But these are not necessarily the products that shoppers want to buy or use.  It is easy to see how this happens.  There is history – a company has always made these types of products.  There is the category you operate in – these products are typical for this category.  There is factory and supply chain capability – these are the products we are set up to produce.  There is R&D – let’s create a product using this new molecule.

These are all important considerations, particularly factory and supply chain capability.  It is rarely easy or cheap to change those two.  However, these are all inputs.  They are based on what do you, or can you, do.  They are not outputs.  What do shoppers really want to buy and use.   To win in a rapidly changing marketplace, we think companies need to be less input driven and more output driven.

So, how can you do this?

Think Broader.  This is about removing the restrictions to your thinking.  History can be a restriction.  The category you operate in can be a restriction.  Current product formats and pack sizes can be a restriction.  Brand positioning can be a restriction.  All of these things can encourage you to do more of what you currently do.  And these are often not the things that you should be doing.

Sometimes these restrictions are explicit.  For instance, you know you have certain supply chain constraints.  But sometimes these restrictions are implicit.  You might not even be aware of them.  You think like this because you have always thought like this.  Small changes in your frame of reference can make a big difference.  Are we a crisp company or are we a snacking company?  How do we get shoppers to buy our products for on the go consumption vs what product will best serve the on the go consumption occasion?  What can our brand do vs what is the right thing to do?

Think Big not Small.  There are lots of innovations that companies think are big changes, but are actually very small, often unnoticeable, changes to the end user.  For example, in lab tests you can measure an improvement in cleaning performance.  Probably a significant improvement when you measure it scientifically.  But for the average end user, the difference between 95% effectiveness and 97% effectiveness is barely, if at all, noticeable.

Shoppers are prepared to pay more (sometimes considerably more) for better products.  But the difference to what came before needs to be noticeable.  To shoppers, not to us.  An important, maybe a little uncomfortable, question to ask – is this innovation going to be noticeably different or better?  Answer it honestly.  If it isn’t, you might want to think again.

Watch out for the Warning Signs.  Any innovation project gives you signals along the way.  Signals about whether it is likely to succeed or not.  However, as in life, it is often only after the event, that we look back and see them.  So, what are some of these warning signs?  It may be that you can make the product too easily.  Too easy may mean not enough change.  It may be that there is little internal debate along the way.  Little internal debate may mean not enough change.

It may be that you are finding it hard to explain what the product is and why it is good.  When you tell other people about it.  When you communicate on pack or in advertising.  Products that are input driven are often harder to explain.  They are often reliant on the ingredient or the molecule.  You understand the benefit, but shoppers don’t.  Not being able to explain the proposition clearly is a big warning sign.

It shouldn’t be about one thing (what you can make) or the other (what shoppers want to buy).  There should be a sweet spot between the two.  Just like the artist who gets critical acclaim and sells a lot of records.

Not sure Tito Jackson’s new song is there yet.

 

On a separate note, our monthly article in The Grocer goes out in tomorrow’s edition .  There is a link to it on our website…http://www.insight-traction.com/learning-from-sainsburys/

Have a great weekend and speak to you next week.

newspaper

Don’t Bury the Headline

Are you capturing shopper attention?

What is the most memorable tabloid headline you’ve ever seen?

Maybe it’s “Gotcha” from 1983 when the Belgrano was sunk.  Perhaps it’s “Bin Bagged” from 2011 when Osama Bin Laden was killed in the US special forces raid.  It could be “Headless Body in Topless Bar” from 1983 after a man shot the owner of a strip club in New York.  Or maybe it’s “Naming Private Ryan” after the 2011 injunction battle to cover up the footballer’s affair?

Whatever your personal favourite, they all have two things in common.  First, they are designed to capture attention.  Second, they are designed to draw you in, so that you read the main story.  Glance at “man shot in bar” and you will probably move on pretty quickly.  Glance at “headless body in topless bar” and you are much more likely to stop and engage.  Then it’s the job of the opening paragraph to get you to read more.

So, aside from giving us the chance to spend a few minutes looking at tabloid headlines, why are we talking about this?   Well, we think good headlines are essential in our industry.  We see so many strategy documents that contain great nuggets of content, but these nuggets get lost amongst all the other information that is included.  They are interesting at the time, but too easily forgotten a few minutes after being read or presented.  The headlines are buried.

The same is true in store.  Shoppers are exposed to more and more information – across brands, but also within a brand.  Too many brands or activities get into explaining mode too quickly.  They forget that one of the key (the first…) jobs in store is to capture shopper attention.  Then you need to direct that attention to the thing(s) that you most want shoppers to see.  Again, too many headlines are buried.

So, what can you do about this – how can you become more headline focused?

Category Cues.  Walk around a store and you will see that a lot of categories are sold in the same way.  There is very little to differentiate one from another.  Walk down an aisle and you will see that different parts of a category are often all sold in the same way.  Yet these categories or sub categories often play very different roles for shoppers.

For instance, if the main reason to buy a category is health, is the category clearly signalling health to the shopper?  Health needs to be the headline.  If a category is all about refreshment, then it needs to be signalling refreshment to the shopper.  Refreshment is the headline.  If a category is all about craft and expertise, then is this being signalled to the shopper?  For example, it is no good just ranging more craft beers, if you are not giving shoppers the craft and expertise cues that should be associated with that range.

What is the headline for your category or segment?  Is that headline capturing shopper attention?

Visual Assets.  This is about visual headlines.  Would shoppers glance at your pack, shelf ready packaging or piece of communication and instantly associate it with your brand?  The battle for attention at shelf is often won or lost in a split second.  This is also becoming increasingly important online – where brand blocks don’t really exist, and most product images are the size of a fingernail.  It is why hero images (simple, stripped back images of a product, that call out key information – size, variant) are far better than standard pack shots.  They are designed for headlines.

It is also about key trigger words.  “New” is a good example.  Too often we see small “new” messages on pack.  Or we see small, generic “new” shelf barkers in store – often with no real link to the product they are supposed to be signposting.  “New” is a key message for shoppers.  It can prompt attention, get shoppers to trial something different (often a higher value product).  “New” is the headline.  Don’t bury it.

Promotions.  This has been changing.  We used to have lots of promotional communication telling the shoppers the old price, the new price and the mechanic (x% off).  Increasingly, we are seeing a focus on the discounted price.  That is now the headline.  It makes things much easier for shoppers.

However, headlining is also really important for added value promotions – particularly as they often do require some more explanation.  We were in stores a couple of weeks ago with a shopper marketing team and saw two different “buy product X, win Y” type promotions.  The first piece of communication tried to explain everything there was to know about the promotion.  You would have needed 4 minutes to read and digest it.  The second had a very simple message to attract the shopper.  Then had the supporting explanation on pack.  Fortunately, we were with the team that had designed the second piece.

Headlines are not about explanation.  They are about attention.  They are hooks to draw us in.  Don’t bury them.

Now, let’s finish where we started.  How about “chick accuses male colleagues of sexism” or “one armed man applauds the kindness of strangers”?

 

Feel free to forward.  Have a great weekend and speak to you next week.