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Tag Archives: Proctor & Gamble

How To Make Sure You’re Working On The Right New Products

First published on 1/30/2013 on www.marketingprofs.com – a preminent resource on best practice marketing technigues for the benefit of the members. Their editorial team cuts through all of this marketing noise to  find the experts and in-the-trenches marketers who know what they are talking  about. Then we take their know-how and mix it with our marketing smarts to turn  it into practical advice that you can actually use through our newsletters,  conferences, seminars, podcast, articles, and webcasts. We must be doing it  right, because we’re a multi-million dollar company that serves a community of  more than 496,000 entrepreneurs, small-business owners, and professional  marketers at the world’s largest corporations. Read more: http://www.marketingprofs.com/about/#ixzz2IHCDaHq8

Product Portfolio Management

It happens all the time.  You learn your active new product programs are either falling behind or the scope of the project has radically changed.  Your teams are telling you they don’t have enough resources to do ALL programs.  Moreover, they seem to be working at cross purposes to one another and have different opinions on the probability of getting the idea to work.  You need to figure out a way to get everyone on the same page so you can keep your new product programs on track and get your ideas to market in a timely fashion.  In this article we will discuss ways to make sure you’re properly resourcing your new product portfolio and then develop tracking tools to make sure they launch on time.  In a prior article (Are your new product ideas attractive enough?), I discussed the major types of new products as well as their differing risk/reward profiles: Type 1:  Simple derivatives/new models of current product lines – easiest to do, lowest risk. Type 2:  Line extensions. Type 3:  New products/innovations in a company’s core category. Type 4:  New product platforms in a new category (to the company) – hardest to do, highest risk. I then recommended using an objective assessment tool to help rank alternative new concept attractiveness from high to low.  The goal is to prioritize your new product portfolio – just like your individual financial investments.  Once completed you then need to determine if your new product portfolio is “balanced” and can potentially deliver results vs. expectations.  There are three critical elements to consider to make sure your new product portfolio is “balanced”.

  • Are your new product ideas strategically aligned with business and innovation growth strategies
  • Is your new product portfolio balanced across product type, risk, time and resources
  • Can they deliver against new product revenue growth expectations – are they sufficient?

One tool than can help in this assessment is development of a new product road map.  A graphical hypothetical product road example is shown below:

New Product Portfolio Management - Product Road Status

 Click On Image To Enlarge

As you can see this graphical plot shows the type of new product, the size of the opportunity, where it is in the new product process as well as its estimated development timeline.  This tool can then be used to help allocate limited development resources to achieve the desired risk vs. reward balance requirements. 

Fortunately, this same tool can also help you track and manage your new product portfolio.  All one needs do is plot progress along the launch time line as well as its current status in the new product development process at different points in time (i.e. quarterly reviews) as shown in the example below:New Product Portfolio Management - Product Road Quarterly Update

 Click On Image To Enlarge

As you can see, these tools are straightforward, easy to understand and really helps to get everyone on the same page.  One minor caveat – in very large/global organizations there can be literally hundreds of new product initiatives making tracking more of a challenge.  Fortunately, there a number of available automated product portfolio management tools on the market.  Once such program is called “Clarity” owned by Computer Associates.  This type of automated tracking programs use a dashboard concept to assist in tracking a large number of new product programs.  See screen shot examples below show how this can be used in larger organizations.

Computer Associates Clarity Program Dashboard Example

 Click On Image To Enlarge

 Computer Associate Clarity Product Portfolio Dashboard Example

Click On Image To Enlarge

One final note.  It’s VERY important both senior and line managers be consistent in their new product resource management decision-making process.  What this means is line managers need to have “straight talk” with their senior leaders regarding realistic risk vs. reward opportunities.  Senior managers also need to realize their teams can’t do everything.  If priorities change too much this sends confusing messages to the organization which can easily cripple getting anything out the door.  Finally, the type of tracking tool that’s used is not as important as having A tool to help manage and track alternative new product concepts.  Product portfolio tracking roadmaps are considered “best practice” at many leading global companies like Proctor and Gamble, General Mills, Coca-Cola, Whirlpool, General Electric and Stanley Black & Decker, etc.  They consistently manage and track their portfolios to make sure they’re delivering the right mix of big and small ideas sufficient to meet the strategic growth objectives of their organizations.  It’s little wonder then that many of these companies are #1 or #2 in their respective product categories.  Can you say your company is on this list? 

Rick Steinbrenner
Chief Marketing Officer/Principal, Brand Marketing Advisors
www.globalbrandguy.com
The Global Brand Guy  

Digital Providers Say Forget Clicks – Focus on Brand Building

Recently, I wrote a post about the efficacy of digital marketing – is it really driving sales / brand building or is it just about clicks/grabbing eyeballs?  This question was was posed based on a 1/’12 article – “marketing capabilities for the digital age” sponsored by the Boston Consulting Group (BCG).   In this article about 3/4 of global CMO’s aren’t sure if digital marketing efforts can be tied to business results.  This was just one of many conclusions.

More recently, Facebook the opportunity at the 2012 Advertising Week conferences in New York City to answer questions about the efficacy of buying advertising on their site.  These set of conferences were sponsored by Mediapost communications, the mobile marketing association and interactive advertising bureau.

Brad Smallwood, director of pricing and measurement at Facebook, discussed the findings of a study the company hoped would change advertisers’ minds about depending on measurements like clicks to determine the success of campaigns on Facebook.com. The goal is to have them perceive the social network more as a medium akin to television for branded advertising

“If you ran a campaign in the last five years, you focused on clicks,” Mr. Smallwood said, but “demand fulfillment is only one piece of the marketing puzzle. We have to provide a solution for the brand marketers of the world,” he added.

The study was conducted with a new Facebook partner, Datalogix, a company that measures in-store purchases. Fifty campaigns on Facebook were measured, for brands from giant marketers like Nestlé, Procter & Gamble and Unilever. When purchase data from stores was combined with data about ad impressions on Facebook, the study found that 70 percent of the campaigns enjoyed three times greater return on their budgets, and 99 percent of the sales came from consumers who did not interact with the Facebook ads.  More details on his comments are on the link below.

http://techcrunch.com/2012/10/01/facebook-brad-smallwood-datalogix/

I do applaud Facebook efforts to help branded advertisers assess the effectiveness of their online digital efforts.  If someone could show online ad impressions efforts can be tied to in-store sales / brand building, this would be very useful.   However, you need to spend more money with Facebook to figure this out.  It is not transparent.  In other words, you need to “trust” Facebook that they can tell you the right number of impressions to reach your target audience based on their “black box model” with Datalogix – their market research provider.

Facebook says ad impressions is the standard in the TV advertising world – we shouldn’t focus on clicks anymore.  While ad impressions are a traditional TV ad world concept, their view of effectiveness is not – at least not yet.  I’m not aware of any traditional TV ad metric that can say for sure – these number of impressions can drive the desired sales result.  Yes, reach and frequency does drive effective reach and based on historical benchmarks you will have a higher degree of confidence a certain level of spending will work.  However, no one can “guarantee” a positive sales result – there are too many more variables – not the least of which is pricing and distribution – not within digital marketings’ control.  If Facebook/Datalogix have such data they should share it in the interest of driving more understanding among the branded advertising community.  If they would, they would be first to market on this piece and their business will increase.  Trust is the issue here and Facebook and other digital providers have yet to earn it.  Trust has to be earned, not demanded.  Just my take.

Rick Steinbrenner
Global Marketing Officer/Principal Brand Marketing Advisors
www.globalbrandguy.com
The Global Brand Guy 

Is Digital Marketing An Effective Brand Building Strategy?

A recent Boston Consulting Group article says most Chief Marketing Officers aren’t sure. 

Obviously, social media is important/highly efficient and holds the potential for building better relationships with communities of consumers/customers.  Traditional marketing (i.e. TV advertising / promotion / PR) historically placed a premium on brand building and transactions, but has declined in importance due to a combination of message clutter, time pressed consumers, fragmentation of media and the growth of people using the internet to research what others are saying about products/companies.  Nevertheless, what really concerns me is how “tactical” social media has become in recent years and less “strategic”.  It appears almost everyone on the social media provider side keeps looking for the latest tools / technique.  If something doesn’t work, they simply abandon the approach and go for another without regard to strategy.

Social media today seems to be just a collection of curation, SEO / SEM, permalinks, long tail key words, meta descriptions, website crawling, and click through conversation rates (to what we don’t know) and more.  Moreover, when anyone “disses” social media, most assume it’s just driven by a desire to go back to “good ole days” of traditional TV marketing / brand building and they don’t “get it”.  What makes this worse is some digital marketing providers don’t have a clue on how to make social media effective and how it ties to a clients’ business strategy.  I recently attended a social media presentation put on by top online agencies and when asked how they know if digital marketing drives clients’ sales and builds brands the response was: “I don’t know, but you just need to invest in it since it’s the right thing to do”.  No wonder, most CMO’s struggle with social media.  I think most want to use it, but don’t know how to bridge traditional TV marketing vs. the new world of digital marketing.  They also aren’t getting a whole lot of help from digital providers.

To put all this in a fact-based driven perspective, a recent BCG article below was published in January of this year.  It was based on a survey among CMO in global fortune 500 companies. The link is attached below:

https://www.bcgperspectives.com/content/articles/marketing_branding_communication_marketing_capabilities_for_digital_age/

Below is a summary I gleaned from this article. I’m sure you will have your own if you read it and it’s a good read anyway.

* Most companies do recognize the need to adopt new ways to reach consumers and build better relationships (i.e. websites, Facebook, Twitter, YouTube, mobile marketing, etc.). It can be very efficient, free / cheap, and can easily measure traffic / activity (read efficiency).

* However, some companies are still just experimenting with digital marketing; while others have developed an infrastructure that can share data with relevant internal business groups. These companies usually spend >20% of their budgets on social media.

* Roughly ¾ of all marketing executives in global Fortune 500 companies are still unsure where to best reach consumers via these new mediums. Moreover, 90% feel they don’t have the right metrics that can tie into business objectives.

* Marketers seem to think consumers want information or product reviews from websites. But consumers want marketers to give more discounts and/or access to purchasing products online vs. brick and mortar stores – This is a disconnect.

* Even the mighty Proctor & Gamble is redeploying marketing spend away from traditional media to digital since it’s more efficient and less costly. They announced recently they will lay off 1,600 people and are banking on digital ROI for long term savings.  However, I bet P&G is also developing the internal infrastructure to capture the data and share it with relevant internal business groups to help change their business models.

* Outsourcing of social media initiatives to outside agencies exclusively is probably not best option given need for integrated brand messaging.

* More companies are adding IT capabilities to marketing management job descriptions. Marketing and IT are converging into one function. Marketers now need to learn digital in addition to traditional marketing / brand building skills to be effective going forward.

Source: Boston Consulting Group

Based on this, a few conclusions come to mind.

1) CMO’s need to better understand social media and how it works beyond just giving assignment(s) to outside agency(s). 

Simply outsourcing social media will not work.  They need to know how to effectively use it for impact.  CMO’s really need to know SEO and how consumers are talking / searching about their company / brands.  They then need to have the right strategy(s) and develop the right social media tool(s) addressing those strategy(s).  It also needs to be measurable to make sure it’s working.  Developing the right kind of metrics will go a long way to proving social / digital marketing effectiveness.  This might require testing of alternative approaches to see which works / doesn’t work and not just guessing.

2) When social media / digital marketing is used there needs to be a organized and well thought out customer / consumer feedback loop to the organization. 

Comments / data from consumers, influencers, other stakeholders and communities need to be filtered back not only to marketing, but to customer service, sales, supply chain, finance and even engineering / R&D.  You need an internal infrastructure to capture this information and be able to synthesize it for these groups so appropriate changes can be make to companies business models. Social media is cheap…but there is a huge labor cost involved in using the data to help change your business.

3) Finally, using social media / digital marketing tactics exclusively is probably not a good idea. 

A good business strategy will probably require a blend of BOTH traditional TV marketing and social media / digital marketing.  We must remember digital marketing is a “slow burn” approach and in some cases won’t help brand building that quickly – just like traditional TV marketing.  In some cases traditional advertising or promotions will help jump start a strategy while social / digital marketing will help build the brand in the long run.  Using both to some degree is the best way to EFFECTIVELY grow your business, but again it needs to be driven by strategy and not the latest tool / technique.

Marketing is evolving and social / digital marketing is part of that evolution.  We all need to learn how to use the new tools as well as refining the old.

Rick Steinbrenner
Chief Marketing Officer/Principal, Brand Marketing Advisors
www.globalbrandguy.com
The Global Brand Guy