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Published: January 2, 2007

 
 

A 21st-Century Approach to Product Launches

Forget the old rules for bringing products to market. Procter & Gamble is helping to write a new playbook.

In today’s increasingly crowded consumer markets, it’s difficult to secure shelf space for established products, and it’s next to impossible to find retailers to carry new, unproven products. Items that do find their way onto shelves often get there because marketers have taken an innovative approach to launching them: Before they even approach retailers, marketers build significant consumer bases for their products using nontraditional marketing channels such as the Internet, infomercials, or targeted viral e-mail campaigns. By thus cultivating a loyal following, marketers are able to prove to retailers that consumers will be prepared to purchase their products at launch.

Building successful brands requires marketers to employ an entirely new set of competencies than the ones they used 10 years ago. Media consumption habits are changing, making popular advertising vehicles such as 30-second television spots and print ads far less effective. As a result, marketers have been forced to overhaul the traditional launch model, which relied on mass-market ad vehicles and broad product distribution to raise consumer awareness of their goods.

Now companies in nearly every industry — from consumer packaged goods (CPG) to automotive manufacturers — spend as much time focusing on how they bring products to market as they do developing their latest innovations. Procter & Gamble, which became one of the world’s biggest CPG companies thanks in large part to its legendary, almost formulaic approach to marketing, has proven surprisingly good at adopting nontraditional launch strategies. A case in point: its introduction of Crest Whitestrips in late 2000.

When Procter & Gamble set out to launch its revolutionary tooth-whitening product — a thin, clingy plastic sheet coated with a whitening formula — one of the first questions it confronted was how best to showcase its innovation. Should it introduce Whitestrips as a stand-alone brand? Under one of its existing health brands? Or under one of its beauty lines, such as Cover Girl? In previous years, P&G would have launched Whitestrips as its own new brand to spotlight the new technology and insulate existing brands. But in the 1990s, because media costs soared and retail consolidation made shelf space more difficult to secure, CPG companies like P&G began launching new products under the banner of existing brands. For Whitestrips, P&G concluded that its Crest brand would help ensure shelf space with retailers, while conveying the right messages about effectiveness, safety, and health benefits to consumers.

The rule of thumb is simple: To find the best brand in the portfolio for new innovations, determine which brand’s positioning the new product can complement. In today’s hyper-competitive consumer environment, developing a new brand is recommended only when no complementary brand exists, or if an established brand is too weak to get a boost from a new innovation.

With the branding question resolved, P&G needed a creative way to introduce Whitestrips to the mass market. The company realized it faced significant consumer adoption barriers because the product was unfamiliar; there was nothing like Whitestrips on the market. Unwilling to invest hundreds of millions of dollars up front on a marketing campaign, P&G turned to its network of 45,000 dentists — whom it had supplied for many years with dental care products — to recommend its Whitestrips to patients.

Next, P&G marketers embraced a technique that has since become a common best practice across many industries — the “soft” launch. Whereas traditional launches called for companies to run weeks of focus groups and controlled market tests before launching products, the idea behind a soft launch is to use the launch itself to get honest feedback from consumers. With limited distribution and promotion, the exercise aims to gather consumers’ opinions and use the information to influence product development and marketing decisions before a larger launch.

 
 
 
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Resources

  1. Robert G. Cooper and Michael S. Mills, “Succeeding at New Product Development the P&G Way,” PDMA Visions, October 2005: An overview of P&G’s new product development process. Click here.
  2. Edward Landry, Andrew Tipping, and Jay Kumar, “Growth Champions,” s+b, Summer 2006: How to get the most from new or existing brands. Click here.
  3. Patricia Sellers, “P&G: Teaching an Old Dog New Tricks,” Fortune, May 31, 2004: Under Chief Executive A.G. Lafley, P&G has instituted a creative but rigorous innovation process to great effect. Click here.
  4. Fara Warner, “Don’t Shout, Listen,” Fast Company, July 2001: How P&G relies on its product Web sites to learn about consumer tastes. Click here.
  5. Crest Whitestrips Web site: History and overview of the Whitestrips product. Click here.