weaver why products fail 20080721
TRANSCRIPT
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1Why Products Fail
Why Products Fail
Jonathan WeaverMike Vinarcik
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2Why Products Fail
Acknowledgment
This lecture is primarily derived from the following
Cohort 5 MPD Thesis and Thesis Presentation:
A Concept Selection Tool to Extend Pugh Matrices, by
Moe Fawaz, Michael J. Vinarcik, Susan Wellman-Smith
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3Why Products Fail
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Product Planning Gone Wrong
What is it?
Its an X-Ray machine used to
fit shoes
It was popular in the late 1940sand the 1950s
Then people realized that the
radiation danger outweighed the
perfect shoe fitespecially
when many machines werepoorly maintained, leaked
radiation, and were improperly
adjusted
http://www.neatorama.com/2008/03/06/shoe-fitting-x-ray-machine/
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6Why Products Fail
Definitions
Product Failure: (1) occurring whenever management
regrets the new product introduction, (2) a product failing
to live up to its company expectations in the market
Product Successes: products which met or exceeded theirobjectives
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Some Basics
Likelihood of product success increases if the company understands
user requirements and provides market-pull type products
The most common reason for product failure is inadequate market
analysis
Surveys have shown that about 2/3 of products considered to be a
technical success are product failures
Product success requires:
correct identification of an existing demand
efficient development presence of key individuals
a clear advantage over competing products
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Some Stats on New Products
1 of 7 new product concepts succeed commercially
the others are either cancelled or fail afterintroduction
80% of the products which fail do so very shortly aftertheir introduction; a further 10% die within 5 years
46% of resources are devoted to new products are spenton products that fail
Product failure spans all domains of products (andservices)
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Facts About Consumers
Consumers are becoming increasingly educated aboutproducts and increasingly discriminatory
Better products dont necessarily cost more
Consumers select products closely tailored to their needsusing factors such as :
Price
Quality
Reliability Ease Of Operation
Safety
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Facts About Companies
Established global giants are just as likely to introduce
flops as smaller, younger companies
Companies do not learn from each others mistakes (in
fact they often follow them) New products are more likely to succeed if the company
truly understands user requirements and selects an
appropriate concept which satisfies those requirements
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Six Main Principles Of Product Failures
1. Idea Failure
2. Extension Failure
3. Public Relation Failure
4. People Failure
5. Re-Branding Failure
6. Culture Failure
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Idea FailuresDescription Reasons for
Failure
Lessons
Learned
Main Rival
Persil Power New detergent
formula that is
supposed to
fight any stain
Formula was so
powerful that at
high temperature it
didn't only destroy
the stain but the
clothes as well
Products need to
be tested in
every
environment
they are likely
to be used
Ariel, effective
without
destroying the
clothes
The Hot
WheelsComputer
A computer
that targetedthe boys
market, had
hardware
decorated with
hot wheels
flame logo
Attempt to gender
marketing
Get designers
involved at thestart. Designers
should give
engineers input
on product
usability and
interface issues
Radion A washing
powder
It wasn't different
enough from other
popular products
Differentiate
yourself from
the competition
More expensive
and lower
quality than its
main rival
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The Extension Failure
Extension cannibalizes sales
Divides existing pie into smaller slices
Addresses the needs and wants of the marketer rather than
those of the consumer
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14Why Products Fail
Extension FailuresDescription Reasons for Failure Lessons
Learned
Main Rival
Crest First fluoride
toothpastebrand.
Crest kept on offering
new variations on thesame theme, thereby
confusing the
toothpaste-buying
public.
Don't confuse the
customer byoffering too
many product
duplicates.
Colgate came
with fluoride,tartar control,
gum
protectionall in
one.
Heinz All
NaturalCleaning
Vinegar
A double-
strengthcleaning aid
The fact that both
vinegar and Heinz arenormally associated
with things you can eat
only made the product
more confusing for the
customer.
Products can be
expandedprovided they
remain true to
their core
identity.
Xerox DataSystems A computertechnology
and data
processing
Xerox was trying totransform itself into an
IBM-style
"information
business, but the
public was unwilling
to think of Xerox in
any terms other thanthe copier company.
It is vital to knowthe association of
the brand name
in the consumer's
mind before
introducing a
new concept.
IBM
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Public Relation Failure
When a company doesnt provide the truth about a
negative incident of a particular product
This might lead to an automatic new concept flop
Ex. Firestone handling of the tires issue
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The People Failure
Product ultimately depends on individuals who represent
it in order to survive
Ex. Enron, top executive acted irresponsibly
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The Re-Branding Failure
Can undermine the companys previous marketing efforts
Tommy Hilfiger
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The Culture Failure
The internet facilitates expansion to new markets
It is important to remember cultural differences which canaffect the products chances to succeed in new markets Hallmark cards in France (they prefer to write their own words
inside) Kellogg's cereals in India (traditionally had hot vegetables for
breakfast, cereal expensive)
Pepsi in Taiwan (Come Alive With the Pepsi Generation wastranslated Pepsi Will Bring Your Ancestors Back From theDead)
Parker pens in Mexico (It Wont Leak In Your Pocket wasmistranslated to a slogan involving unwanted pregnancies)
Vicks products in Germany (the brand name had negativeconnotations in German)
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Some Classic FailuresProduct Description Failure criteria
Kodak mc3 MP3 player, a digital
camera, and a digital
video camera, all in one.
All in one for $ 300 came
at the cost of quality
Betamax Was regarded as farsuperior in sound and
picture quality to VHS
formats
Consumers turned theirnose up on the price
which was driven higher
than VHS largely due to
Sonys proprietary stance
Manual Typewriter A victim of technologicalevolution
Hydraulic elevators Had an alarming failure
and fatality rate in
skyscrapers and were
quickly replaced by
electric versions
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Failures Due To Technology
Standard Photographic Cameras Vs. Digital Cameras
Polaroid Vs. Digital Cameras
Heuristic:
Concepts Based Around A Particular Technology Have AShort Half-Life
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Bad Design Concepts
Top-loading VCR
Cant Put Anything On Top
Of It.
Heuristic: Consider The Environment That The New Product
Will Be Used In.
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Bad Design Concepts
The On/Off Switch Can
Be Easily Activated By Accidentally
Pushing An Object Against It
On/Off Switch Is Placed
At An Angle
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Bad Design Concepts
Most people expect to push the buttons
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Bad Design Concepts
Difficult To Tell WhichControl Goes With Which
Burner
Controls Are Arranged In
The Configuration As The
Burners
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Heuristics From Concepts That Flopped
Chord Of Familiarity
Radical concepts should be kept on the market forenough time or be heavily advertised
Communicate Clearly Never assume that the consumers know
Why they should use the product
How they should operate it
What its purpose may be
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Heuristics-continued
Convenience
Consumers will select the product that makes theirlives easier
Extraneous Extras Consumers wont pay for what they dont want or
cant use
Failure Is Opportunity
Failure always presents new opportunities
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Heuristics-continued
Ignore Office Politics
Dont be afraid of pointing out the flaws of a bad concept
Picket Fences
Share thoughts with the people your concept is targeting
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Hot Buttons For Success In The Millennium
Convenience
Environment
Ethnicity
Fun Nutrition
Packaging
Size
Youth
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Summary of Considerations
Creative developers must be given time to make mistakes
Innovation= 99% perspiration and 1% inspiration
No better way to success than by learning from mistakes
There is as much to learn from failures as there is fromsuccesses
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