a practical guide to growing your business and profitability with new products

7/29/2019 A Practical Guide to Growing Your Business and Profitability with New Products

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A Practical Guide to SuccessfullyGrowing your Business andProfitability through New Products

Copyright K. Murray 2008, 2013


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A Practical Guide to Successfully Growing yourBusiness through New Products

1. The Case for the NPD Strategy

2. The Basics

Unmet Needs and being Market Driven

Ideas and Idea generation

NPD Process

3. Succeeding at the Business of New Products

Succeeding in Commercialization ROI and measuring results

Platforms: Strategic linkage and streams of new products

TEC Meeting Agenda:


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Some of my new

product experience
http://images.google.com/imgres?imgurl=http://www.bonduelle.ca/images/cnt-img-mar-07.gif&imgrefurl=http://www.bonduelle.ca/en/marques/&h=52&w=95&sz=2&hl=en&start=6&usg=__0a7a4XFpweeRrn6vpayrvTAg5D0=&tbnid=MmiVuS-NBzWOaM:&tbnh=44&tbnw=80&prev=/images%3Fq%3DStokely%2BVegetables%26gbv%3D2%26hl%3Denhttp://www.nutritiousjunk.com/fat-free-reddi-whiphttp://www.arborstrategy.com/index.phphttp://en.wikipedia.org/wiki/Image:Little-Caesars-Logo.jpghttp://www.sanjamar.com/pls/enetrixp/!stmenu_template.mainhttp://www.spectracide.com/ProductCategories/OutdoorInsecticide/TriazicideSoilTurfConcentrates/


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San Jamar Product Platforms 2003

WASHROOM AND

HAND HYGIENE

The leader in universaltowel & tissuedispensing.

COUNTER SERVICE

A leader in food safecountertop dispensing &

specialty products.

FOOD SAFETY &

SANITATIONThe innovative leader in FoodSafety & risk management

tools.

Washroom &

Hygiene

Smart CounterDispensing

Safe Food Prep

Bar Smart Solution

Clean Hands

Safe Ice Handling

Safe Hands


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Apple Results:

Why spend time and $$$ on new product development?

2012 units $$$$

iPod+ 35.2MM $14.1B

iPhone+ 125.0MM $80.5B

iPad+ 58.3MM $32.4B

Source: Apple 10K


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Revenue=$140MM

Sale Price=$420MM

http://www.technicalconcepts.com/index.php?option=com_content&task=blogsection&id=4&Itemid=415


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San Jamar Results:

2/3 of our steady (double digit) growth due tonew products

Basis for much greater attention from criticalimpact accounts

350% profit growth!!



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Unmet Needs and being Market Driven

At the core of every new product

an unmet or underserved need in themarketplace

Key Action: Market Dialog

The best stimulus for new ideas!

Driving to Unmet Needs


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Unmet

(or under-served)Need

Product and

Benefit

Daily Care is Beautiful Light enough foreverydaywear and still contains collagen,vitamins A, C, E, pro-vitamin B5

and emblicaHealthy Color: Natural glowwithout sun-damage

Can be applied daily or as

needed to build and control anatural-looking sunless tan."

Freedom to Enjoy Outdoors: Sunprotection easily, with minimal

application downside

Sprays at an angle - so youcan reach back & legs - Norubbing required - rub-free

formula that doesn't leave agreasy residueon your hands

Driving to Unmet Needs

Created and permitted by
http://www.arborstrategy.com/index.php


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Improved service and hygiene in BAR SERVICE:

Large and growing market framework:Full service restaurants, hotels, golf courses,recreation, country clubs as well as traditional barsand taverns all with bar service

Growing Market: Growth in most marketsegments with bar service outpacing industrylodging, recreation, drinking places Source: Technomic Jan 2008

Large and growing unmet needs in bothimproved service and improved hygiene

Operator discussions highlighted key needs


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End User Dialog

Needs!

Uncovering Unmet Needs: End-User Focus


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Industry Groups

We listen, we observe, we create:Partnerships with leading restaurant chains,health professionals and industry partners inproduct development to address key operatorchallenges

ProductDesignLeadershipAward

Uncovering Unmet Needs: End-User Focus


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Where do good ideas comefrom?

Anywhere!

http://images.google.com/imgres?imgurl=http://www.bharat-rakshak.com/MISSILES/Images/Dhanush02.jpg&imgrefurl=http://spyingbadthings.blogspot.com/2007_06_01_archive.html&h=995&w=810&sz=238&hl=en&start=16&usg=__YXZlR36v8zexueYoINK4Uy1KIoU=&tbnid=fhkIAD0eKBxiGM:&tbnh=149&tbnw=121&prev=/images%3Fq%3DMissiles%26gbv%3D2%26hl%3Den


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Good ideas come from anywhere


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Where do good ideas come from?

Anywhere!

Quality of ideas is directly proportional

to quantity of ideas

Work at idea generation!



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Divergent vs. convergentthinking



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Anywhere!

Quality of ideas is directly proportionalto quantity of ideas


Trigger ideas with stimulus

Idea-work is group work



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Ideas Stimulus

NewProductWorks

GfK Strategic Innovation

Formerly Arbor Strategy Group (ASG)

www.arborstrategy.com


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Ideas Stimulus

Other great sources of idea stimulus

End-user work

Customers

Industry salespeopleInventors

Designers

Industry experts

Innovations in other industriesBusiness literature


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http://wheatfromchaff.net/blog/wp-content/uploads/2007/02/brainstorming.jpg


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Anywhere!

Quality of ideas is directly proportionalto quantity of ideas


Trigger ideas with stimulus


Benefits, benefits, benefits!



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Real Benefits!Saves labor

Saves/makes money

Saves lives

Saves energy

Vs fake benefitsThe only one to

Does it all

Higher Quality



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Emotional Benefits:

Most successful brandstied to emotional benefits

Consumer Targets:

Family, Life values,Life-style

B to B:

Trust, Success,Loyalty



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New Product Development Funnel

Development of a product and risk/approval

march together

Cross-functional development teams

New Product Process and risk management


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Deliverables

5. Opportunity Identification:

Future Market Map &

Strategic Platforms

1. Synthesis of Internal

Learning and Category Situation

3. Future Innovation Analysis:

Macro Trends & Innovation Tree

4. Emerging Technology

Assessment

2. Qualitative Assessment:

Consumer View & Insight Mining

7. Phase 1 Presentation &

Platform Work Session

STRATEGIC OPPORTUNITY

DEFINITION

Phase 1: See the Future

6. Quantitative OpportunityAssessment: FutureScape

1. Innovation Concept Ideation:

Concept Factory

2. Concept Development:

Skeletons Consumer-Ready

3. Concept Evaluation/Refinement:

Consumer Discovery

4. Feasibility Assessment

5. Quantitative-Ready Concept

Format

6. Final Presentation:

Comprehensive Growth Blueprint

IDEATION & CONCEPT

DEVELOPMENTPhase 2: Be the Future

Concept Development: 600 level

GfK Strategic Innovation

Formerly Arbor Strategy Group (ASG)

www.arborstrategy.com


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Idea Generation and preliminary

Concept development

Identifying the productembodiment, Building the

Business Case

Engineering Development,Marketing Plan

Launch Prep

Commercialization

OpportunityIdentification Ideas

Validation, Testing,Feedback,

Final Review

Review

Assessment

Initial Screen forprelim. feasibility

Stage Gates

New Product Development Funnel

Managing Risk:

1. Verifying/scaling the

underlying unmet need

2. Determining if youridea really meets it

3. Determining if theproduct really delivers


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Phase of

development

Typical

Expenditures

Key validation steps you

should perform:Conceptdevelopment

Moderate: Market dialog to validateidea appeal

EG Focus groups, In-depthinterviews

Productdevelopment andscale up

Moderate toHeavy:

Prototype user experienceDeep market dialog tovalidate intended businessmodel

Commercialization Moderate to

extremelyheavy

Product performance

validation (in-field andtorture-testing)

Test market

New Product Development: Managing the investment risk

Note: Different categories or types of productshave different investment and risk profiles


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Getting feedback early: Use rougher stimulus

Extreme Condition Sun Protection

Now theres a sunscreen strong enough toprotect you from the suns rays even in the most

extreme conditions

The solar intensity of the tropics and highmountain altitudes requires advanced sunprotection. Even more so when your skin isexposed to the dangers of sunlight reflecting off

snow or water. Extreme Sun Protection offersprotection to the max. We combinedmicronized titanium dioxide with SPF 50 toinsure maximum sunscreen block, especially foryour hands and face. Its waterproof and sweat

proof, too. Use Extreme when you want thebest protection from the sun. If its strong

enough for extreme conditions, its strong

enough to protect you every day.

Coppertone Extreme

Condition Sun ProtectionNow theres a sunscreen strong

enough to protect you from the sunsrays even in the most extreme

conditions

G tti f db k


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Use phase-appropriate stimulus to get the right feedback

Black & WhiteConcept Art

Real-Time ConceptSketches

Test-Ready Concepts

Prototypes

Getting feedback :

N P d D l T


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New Product Development Teams

Charter: Develop and implement a NPD process within thecompany culture which becomes the foundation for producing

successful new products

Bill of Rights for Team Members:

Team define the project and buy-in

Participate as a full-fledged team member, Contribute fully to the project,Help the team resolve problems

Consider the teams work as a priority as a part of the team membersreal job

Listen to others and be open to their ideas

Accountability: Carry out assignments between meetings and report backwhen expected


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Succeeding in Commercialization

Launch Teams, 3 Year Launch, Launch Box

Payback and ROI

Assessment and Measuring success

Streams of new products built on Platforms

Succeeding at the Business of New Products

S di i C i li ti Th L h T


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Launch Team Responsibility Area: TIMING1.Team establishment/basis for interest buy-in Beginning of Phase 3

2.Marketing Plan By End of Phase 33. Volume Estimate End of Phase

4. SKU, Merchandising and Packaging Strategy End of Phase 3

5. Customer planning End of Phase 3

7. Competitive Assessment End of Phase 3

8. Marketing plan timeline End of Phase 3

9. Internal Training/Communication Start with Phase 410.Item Master set-up Packaging specifics During Phase 4

11.Production Forecast Release to Production

12.Fine tuned Marketing plan Release to Production

13.Customer Sell In During Shipping

14.Assessment/Adjustment Quarterly after Launch

Succeeding in Commercialization: The Launch Team

S di i C i li i 3 Y L h


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Succeeding in Commercialization: 3 Year Launch

Typical Volume Build:Commercial Markets

Launch

0

50

100

150

200

250

Yr 1 Yr 2 Yr 3 Yr 4 Yr 5

New

C i li ti L h B C t


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Platform Solutions

Selling Tools

Sell Sheets: Productand System

Customizable EmailBlast

Platform Website:videos, lit and more

Sales Meeting Support:Power Points, handouts

Selling tips: benefits forall stakeholders

Rep & Dealer SupportPrograms

Product Sample Kitswith Accessories

Merchandising ShelfTalkers for Showrooms

Private Label Options

National advertising todealers, end users.

All the tools to hit the ground running!

Commercialization: Launch Box Concept

S di t th B i f N P d t


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Succeeding in Commercialization

Payback and ROI

Assessment and Measuring success

Streams of new products Platforms

Getting started

Succeeding at the Business of New Products

ROI Payback and Assessment Examples:


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Project types Incrementalvolume

Simple Payback Internal Rate of Return

Smaller/moreincrementalproject

Modest One year, + or - Very high, with very lowrisk

Larger/moregroundbreakingproject

Large Longer Can be very high, butmuch larger risk/variability

Productimprovement

Varies basedon businessobjective

Target One year, +/- Usually very high (IFevaluated vs. competitivemarketplace)

ROI, Payback and Assessment Examples:

Platforms and Streams of Products


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Platforms and Streams of Products

BrandEquity

UnmetMarketNeeds

CompanyCore

Competencies

Platform Sweet Spot

Product Benefit Space

Introducing products in a platform


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The Safe Food Prep System: Addressingsafety/sanitation problems in the prep room

Saf-T-Griptm

salesnearly $200M in the firstfew months of launch!

Saf-Checktm hasalready attracted

major auditor, enduser and healthinspector interest

FER Product of theYear!!

Safety WrapStation

Portable WrappingStation with integrated

labeling tools

Introducing!

Versa-PrepSystem

designed for the

wayyou want to

prepare food

Introducing products in a platform

Growth through New Product Innovation


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San Jamars growth (and profit growth!) took off when we systematicallyfocused on innovating around our core categories.

Growth through New Product Innovation

a practical guide to growing your business and profitability with new products

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