Monday, June 08, 2009

Why New Products Fail To Make Big Money

Because new products that lack creativity are just line extensions. Case in point? 2008's most successful new product was Gatorade G2. It sold $159 million in the first 12 months. The last successful new product launched by anyone in the consumer packaged goods industry that sprinkled the effort with creative thinking was Frito-Lay's Baked Lays Potato Chips. It sold $310 million in it's first 10 months. No other new product has surpassed this level of first year sales in the consumer packaged goods industry for at least the past ten years. There's a lot of creativity not going around. But there sure are a heck of a lot of underperforming line extensions. You know Chunky Soup was going to be an extension of the Campbell's Brand. They were going to market it as a stew. Then creativity turned it into the soup you eat with a fork. It was the product that first pushed and sustained the Campbell Soup Company at over a billion dollars in sales way back in 1970. Why is this type of creativity so few and far between? Now there's a question.

1 comment:

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