Coatings World - January 2013

Product Success and Failures

Upfront accurate market research properly incorporated into the product design and launch tactics is the central key to a long-term successful product contribution.

by Phil Phillips, PhD Contributing Editor phillips@chemarkconsulting.net

Approximately 80 percent of new prod- uct innovation fails, highlighting the challenge that coatings, paints, adhesives, sealants and other specialty chemicals industry players face in innovating in today’s competitive market landscape. Failed innovation can severely undermine profits and brand reputations. Conversely, the rewards for successful innovation are substantial.

Harvard Business School studies and main-
stream magazines such as Business Week, have
discovered that there’s a wide variety of reasons
why new products fail. These reasons include:
• Under-investing in sales & marketing and /
or not inspiring channel partners;

•Not addressing customers’ needs (e.g., having an “engineering focus” rather than a market focus);

• Poorly defining the target market and/or poorly positioning the product;

• Not clearly communicating the products benefits;

• Bringing to market products that require ancillary products or services;

• Introducing a product in the wrong part of the adoption curve;

• Extending the brand too far beyond its established equities.

Other reasons include creating a disconnect
between promise and delivery:
• High level executive push of an idea that
does not fit the targeted market.

• Overestimated market size.

• Ineffective promotion, including use message, which may have used misleading or confusing marketing message about the product, its features or its use.

• Not understanding the target market segment and the branding process that would provide the most value for that segment.

• Incorrectly priced—too high and too low.

• Excessive research and/or product development costs.

• Underestimating or not correctly understanding competitive activity or retaliatory response.

• Poor entry timing.

• Misleading market research that did not accurately reflect the actual consumer’s behavior for the targeted segment.

•Conducted marketing research and ignored those findings.

• Key channel partners were not involved, informed, or both.

• Lower than anticipated margins.

Examples of product failures The following is an abbreviated list of product failures that may provide insight that will help to identify product and brand success factors:

Automotive

•Cadillac Cimarron (miss-judged market acceptance for a small Cadillac)

• Pontiac Fiero
• Chevrolet Corvair (Ralph Nader – “Unsafe
at Any Speed” – book)

• Ford Edsel
• The DeLorean
• Crosley
• The Tucker
• The Gremlin, the Javelin and a complete
line of other models by American Motors
• Mazda’s Wankel rotary engine
• Firestone 500 tire
• Goodyear tires used on the Ford Explorer

Entertainment

• World Football League
• World League of American Football
• United States Football League
• “Of God’s and Generals,” “Heavens Gate,”
“Water World,” “The Postman” and other
movies—with a disproportionately high
number produced by Kevin Costner.