Why do some products succeed while other highly innovative products fail? If you ask Clayton Christensen, a Harvard Business professor considered one of the world’s leading experts on innovation and growth, he’ll tell you that when customers buy products, they are “hiring” them to help with jobs to be done. Winning products get the job done.
To illustrate his point, Christensen has spoken frequently about his work with McDonald’s to help the fast food chain improve the sale of its milkshakes. Despite McDonald’s extensive demographic research to understand “the milkshake customer” and input from profiled customers, changes to the product had no impact on sales.
Called in to help, Christensen’s researchers found that about half of these customers were purchasing the beverage rather than other food options to make their commute more pleasant and to sustain them until lunch. Based on this finding, McDonald’s enhanced the milkshakes, making them even thicker to last longer. They also moved the milkshake from behind the counter to the front and gave customers a prepaid swipe card so that they could dash in, get their drinks and go, avoiding lines.
Meeting a real need
Such findings underscore the need for product innovation to design products and brands that offer customer value by meeting a real need and doing so better than alternative solutions. Some products mistakenly address customer wants, which are more aspirational and therefore more difficult to address and so not on target.
Of course, in some cases, poor execution of strategy, bad timing and poor pricing also contribute to product failures, even for the right products. Researchers at North Carolina State University on empirical work found the rate of new product failures, which refers to the percent of products introduced to the market that fail to meet commercial objectives, is around 40 percent.
Data-driven focused solutions
In its effort to provide new experiences to meet customer evolving needs, researchers have introduced such market-changing innovations as the light emitting diode (LED), inkjet printer technology, and today are breaking ground with new blended reality products that combine the physical and digital with augmented reality that takes sensory inputs – sounds, scents, sites and haptic, or touch, feedback – to blur the lines between the real and virtual world.
Blended reality technology is available today in 3D scanning platforms, and the research will ultimately produce a host of products to meet several macro trends affecting global economic, demographic and societal change: rapid urbanization, changing demographics, hyper-globalization and accelerated innovation.
Still, to ensure success, optimizing new technology to user-focused solutions requires a data-driven approach that involves extensive feedback and information from customers to understand their needs and assess their interest. Data-driven insights to drive product development and marketing rely on primary research, including interviews, focus groups and surveys, and secondary research to segment customers.
Social interactions are fast becoming a key part of the data analysis to understand the needs of market segments. Interactions online with mobile apps, web content, streaming video and social networks are an indication of customer likes and dislikes offline.
Feedback from customers combined with data analytics provide insight into customer preferences across a range of segments and how new products can enhance their lives. Once a prototype product is developed, customers need time to test it out and provide input about what they like and dislike about it so product development can incorporate the necessary improvements.
Sales has its finger on the pulse
Who better to understand customer needs than the sales team? They must play a role in new product development – after all, they are out there on the front line, talking to customers and potential prospects. They understand what challenges customers face and what products will best solve these challenges. Sales also can provide an improved understanding of data gathered through primary and secondary research and social interactions.
Through customer interaction, sales can also provide insight on evolving market trends and competitive forces. Salespeople also have their finger on the pulse of the channel; they can help in navigating partner acceptance and enthusiasm, leading to higher sales. And with all their knowledge of the customer and channel, sales can provide suggestions that can enhance a product to improve the user experience and shape the user testing experience.