…if it’s not backed up with real customer insight.
Manufacturing consultancy Newton has released a report which claims food manufacturers and retailers in the UK grocery industry waste £2.7 billion annually on product innovations that consumers do not want or prove too expensive to produce.
However, the report claims that if companies focused on products consumers want rather than basing innovations on ‘gut feelings’, the industry could generate up to £233 million in profit from new products and offset the £2.7 billion wastage.
These findings are not a surprise to us, we see it all the time.
What’s the point of knowing how large the addressable market is, if none of these customers are going to actually buy your new product?
We’ve come across very few SMEs that put any real effort into identifying the true needs and attitudes of their target audience.
Of the few that do, most stake everything on their own internal assumptions, those “gut feelings”.
And of the fewer still that actually go and ask the customers what they think, they do it at the wrong time – post-launch, when sales start to fall and they need to protect their shelf space.
Customer insight should come in the very early stages of the innovation process, not at the end. Before your business wastes any time and money on developing products that aren’t wanted – go ask the customers what they really need. And what they need enough to pay for.
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