Delivering a good product experience is essential to repeat purchase and will help drive organic sales growth.  Most consumers will not re-buy an inferior product – no matter how cheap it is.  People are willing to compromise on product quality when buying a cheaper product, but there is a limit.

At a recent research conference in Sydney, Damian Young – General Manager Marketing at Chobani, spoke about Chobani’s success story and the strategy they used to drive sales from around $200k when they first launched in Australia in 2011, to over $90 million in 2016.

Young explained that they had a low media budget and had to come up with a sound strategy to drive growth in the presence of many long standing competitors like Yoplait and Ski.  There were four key parts:

·         to make a great product,

·         make it available for sale,

·         get people to try it, and

·         invite people to talk about it.

Young stressed the importance of delivering a great product experience and measuring it.  People are no longer fooled by pretty packaging.  He said “If you make a crap product now or deliver a crap service there’s nowhere to hide”.  Social media can quickly turn into your worst enemy if you don’t deliver on expectations.

Chobani have a philosophy that ‘The product has to be right’ and they do not compromise on quality.  Young said “It takes four litres of milk to make a litre of Chobani yoghurt, and it takes one litre of milk to make a litre of Yoplait”.  This is how Chobani achieves its amazing thick and creamy texture, and high protein content (without the use of additives) and why it commands double the price point of Yoplait. 

Chobani have their own field team that give away a million pots of yoghurt each year. Product trial is a clever strategy to use when you have a great tasting premium priced product, as people can appreciate the quality of the product for themselves without the initial outlay.  Once consumers have tried it, they are converted. 

Streets deployed a similar strategy in the 1990’s when they introduced Magnum.  Magnum was double the price of the most expensive ice-cream at the time – Heart, however, the product was worth it.  People where happy to uptrade from Hearts ice-cream and compound chocolate to Magnum’s super premium ice-cream and Belgium chocolate. 

Is making a great product part of your marketing strategy?

Need help to measure this?

Get in touch and we will create a strategy to optimise your products’ experience

The post HOW TO DRIVE SALES IN YOUR FMCG’S. PRICE REDUCTION IS NOT ALWAYS THE ANSWER appeared first on Benchmark Sensory Strategy & Research.

Never before has consumer feedback on products been so transparent and instant.  When consumers are unhappy with a change in their usual product they are quick to jump onto Facebook and Twitter to voice their outrage.

When reformulating, FMCG producers must avoid alienating their loyal users.  If a new formulation is not liked or accepted by the current users of the product, then the producer risks losing precious market share and negatively affecting brand perceptions.

It’s not just small players who can fail to transition to a new formulation, any sized company can be at risk. Here are some recent examples.

Recent Reformulations Gone Wrong

In late 2013, Mondelez Australia decided to make Easy Mac ‘healthier’ and substituted the processed cheese with cheese powder. Consumers were quick to post comments on social media such as “It tastes weird. It is a vomitty flavour”. The consumer backlash was overwhelming and after a loss of over $10 million in revenue, Mondelez was forced to revert back to the original recipe.

In 2014, Coca Cola US changed the sweeteners in its Vitaminwater from fructose and sugar, to stevia and sugar in the hope of making it ‘healthier’. After the change, consumers hit Facebook with comments such as “The new taste is nasty. You just lost a customer. I can’t drink it now.”  Within a few months Coca Cola went back to the original formula saying “…We tinkered with the taste of Vitaminwater and our fans haven’t had the greatest things to say about it. So we are changing back to the taste you know and love…”

In early 2015, Cadbury UK switched the Cadbury Dairy Milk Chocolate in its Crème Egg for a cheaper chocolate. Again, loyal consumers of the product took to social media with passion.   This cost reducing reformulation, has cost the company dearly.  According to London’s Daily Telegraph, Cadbury lost £10 million in sales (AUD 20.6 million) from its best selling Easter lines last year.

In mid 2015, Nestle in NZ changed its iconic Milo product to attain a 4.5 health star rating. Consumers took to social media with their complaints such as “Omg!!! What have u done 2 milo? It tastes terrible!!!”

So in a time when we have so many resources available to ensure changes to product recipes are seamless and accepted by consumers, why is it that these blue chip FMCG companies got it wrong? Was it: poorly designed sensory research (or lack of it), that the projects were carried out by researchers with a poor understanding of how to interpret the results, DYI research platforms, inadequate action standards, incorrect respondent sample, budget constraints, or perhaps factors outside of their control?

Regardless of what went wrong in the above examples, there are steps to ensure that this doesn’t happen to you. 

Steps to Reformulation Success

• Define simple, clear objectives for the reformulation project. Typically most reformulations aim to either to improve the current product (eg where a product is failing to deliver on expectations) or match the current product (eg when an ingredient is changed).
• Develop several new prototypes that meet the objectives.
• Run the prototypes through a consumer taste test against the current product. This can be done internally or externally, however, it is important that the research is carried out with regular users of the product and not a random sample. These consumers are very familiar with your product and will act as an instrument to measure if the new formulations differ in sensory profile to the current product, whether or not the new formulations are well liked, and if moving to a new formulation would result in alienation.  The research should be properly designed with a rigorous methodology, have comprehensive product evaluation questionnaires, and be interpreted by a sensory scientist.
• And finally, once the results of the research have been reviewed against your initial objectives, a strategy for implementing the new formulation should be created.  You should consider whether you move forward with a direct replacement of the current formulation, stagger the introduction of the new formulation, introduce an entire new variant, be silent or overt in your communication, or go back to development.

When reformulating, FMCG companies cannot afford to offend their loyal consumers with an inferior or dissimilar product.  Ensuring acceptability of the new reformulated product amongst regular consumers of your product is critical for reformulation success.

The post How to Avoid a FMCG Reformulation Disaster appeared first on Benchmark Sensory Strategy & Research.

In the world of food and beverages, quality is directly related to how much consumers like a product and how it delivers on key sensory measures such as taste, texture, aroma etc.

A good strategy for producers of FMCG’s is to keep on top of how your product and its competitors are performing on key sensory measures with a routine category audit.  This enables you to track the quality and purchase interest of your product versus competitors over time, and make sure yours is consistently performing at an acceptable level.  It also gives you insights into any changes competitors are making to their formulations.  If a cheaper competitor improves their formulation to be similar or superior to yours, you need to take action fast before your market share is eroded.  Similarly, if your main competitor drops the standard of its product below yours, a new opportunity is created for you to win over new business with your superior product.

Having an early indicator of any product shift for cash cow lines is an essential protection and opportunity measure.

Get your product formulation right, keep it equal to or better than similarly priced competitor products, and positive quality perceptions for your brand will follow.

I love the quote from Aldo Gucci who never strayed from producing high quality products:  “The bitterness of poor quality remains long after the sweetness of low price is forgotten”.

The post Is the Quality of Your FMCG In-Line with its Price? appeared first on Benchmark Sensory Strategy & Research.

When asked what research had been conducted during the NPD process, the answer was none.  Some rudimentary tastings were conducted around the lab table and that was it.  We suggested that an unbranded/blind taste test of the product range be carried out with their target market to determine if the products were performing at an acceptable ‘market ready’ level.  Not surprisingly, the research revealed that the drinks were less than satisfactory on tasting.  None of the variants met the benchmark for an acceptable product to be launched into the market place.

This was a classic example of a great concept and brand, with a poor product.  The brand and pack generated trial, but the inferior product was the barrier to repeat purchase.

Conducting sensory research with your target market is an essential part of any NPD process.  This can help avoid any negative impact on your brand, and the huge costs associated with a failed product.  Don’t let an under performing product ruin your new idea’s chance of success.

The post Get Your Pack Right, But Don’t Ignore What’s Inside It appeared first on Benchmark Sensory Strategy & Research.

Consumer sensory research is usually conducted prior to the launch of a new product.  We therefore get to see the standard produced by many different R&D teams.  Some only ever produce mediocre products that require many changes and usually further sensory research.  Some are inconsistent and either hit or miss the target, while others consistently produce market ready products. It is the latter group that provide cost efficiencies for their company and the best chance of success for their new product.

We can all think of brands that consistently produce good products.  With this, our perceptions of the brands quality and trustworthiness are high.  When these brands launch a new product, we usually are keen to buy it and ‘give it a go’ as it will almost certainly deliver on expectations.

Having a great R&D team with the capability to produce consistently good products is an important asset to every FMCG producer.

The post A Great Innovations/R&D Team are Worth Their Weight in Gold appeared first on Benchmark Sensory Strategy & Research.