It’s a lot of work to bring a new product concept to market, and, unfortunately, that work often goes to waste. 90% of the 30,000 new products launched every year fail. Many times, this happens because the products fail to resonate with consumers. Ultimately, there are two key metrics every innovator should focus on: trial rate and repeat rate. In simple terms:
- How often will consumers try your product?
- When they try it, how likely are they to purchase it again?
Both metrics are a function of your product-market fit—how well you are able to identify a problem, and how well your innovation solves it. That is why it is critical to find ways for the market to engage with your product and find ways that you can improve your fit. Often manufacturers wait until too late in the process to engage with consumers (if at all before product launch), cutting down opportunities to incorporate consumer feedback and reducing the likelihood of success.
However, if you can incorporate feedback throughout your food product development process, you ensure that your R&D, marketing, and sales efforts are focused on the right activities, rather than burning capital on lower priority activities and products.
Let’s make this tangible with an overview of the product development process and the types of questions you should answer as you move your product from concept to launch.
DISCOVERY: UNDERSTANDING THE MARKET, IDENTIFYING GAPS AND OPPORTUNITIES
New product development begins with identifying problems or gaps in the market. This is the initial focus for early-stage foodtech entrepreneurs. The key information to get in this stage is market research on today’s landscape: Who are the market leaders? Where are they falling short? How big is the opportunity? It’s also important to think about the demographic group (age, gender, income, retailers, etc.) that will be the primary purchasers. With these questions answered, you can begin to define your product specs and envision what the marketplace could look like with your product added.
PRODUCT FORMULATION: GATHERING FEEDBACK AND INSIGHTS THROUGH SENSORY TESTING
Once you’ve identified your opportunity through market analysis, you need to create and consistently improve your formulation until it is ready to launch. Some common questions here are: Which version of our product is the best? How should we prioritize R&D opportunities? Are we better than the existing competition? It is vitally important to have empirical data to maximize how much people like your product. Check out this article for a deeper dive into how that can work.
PACKAGING DESIGN: DRIVING MORE TRIAL AND IMPROVING THE AT-HOME EXPERIENCE
While you’re working on perfecting your formula, you should also be developing a package that excels both on the shelf and in home for your target consumer base. Packaging needs to be attractive, eye-catching, and messaging your product such that people want to try it. It also needs to give clear instructions for how to consume the food and ensure that the home preparation leaves people with the best possible experience. Again, collecting solid, in-context data is key at this stage.
GO-TO-MARKET STRATEGY: CHOOSING THE RIGHT PLACE—AND PRICE—FOR YOUR PRODUCT
Now that your food and packaging is finalized, determining where, and how to, launch your product is the next big hurdle. This requires answering questions around the pricing, promotion, and use case for your product. Figuring out which demographics are most likely to buy the product (age, gender, income, retailers, locations, etc.), and how to best get in front of them are key questions. There are also decisions that need to be made around selling direct-to-consumers, in bulk, or to food service locations.
IN-MARKET OPTIMIZATION: ITERATING AND IMPROVING WITH ADJUSTMENTS BASED ON DATA
If you’re in this stage–congratulations, you have successfully launched! Even after the product has been deployed, it is still important to explore opportunities to improve performance. Consistently improving your food post-launch is how you develop the best quality products that will stand the test of time. A couple of key issues here are: Are there any opportunities to improve our product? Who should we target as our next set of adopters? What opportunities do we have for new products? Any additional product testing you do will only benefit both you and consumers.
When the success of your innovation is on-the-line, you shouldn’t take shortcuts on product feedback like resorting to feedback from employees or your most engaged customers. Traditionally, the food industry has been stuck with the same product feedback tools since 1980–think white rooms, two-way mirrors, and 1/6th of a burger patty served through a slot. The last real innovation was using the internet for online surveys with groups of consumers, but these people are often closer to professional survey takers.
Not only are these methods inauthentic to how people experience food, they are expensive and slow-moving. As a result, most brands have resorted to testing primarily with small, biased samples of friends or employees.
Palate is different. We’re revolutionizing product feedback with authentic, agile approaches that help sustainable food brands build better products faster.
If you have questions about product development, please reach out to Alex Weissman @ alex@palateinsights.com. We’d love to chat with you!