With more than 20,000 new products launched annually and barely 10% succeeding, there are four key priorities every brand manager and marketing executive should attend to when considering the development of any new product idea. While the trial potential of the new product idea should be the first priority, too often it is the only priority.

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	"The first priority, of course, is to understand the trial potential of the idea—how likely it is that the intended target will try the product," said Mark Sneider.

There are three other key priorities that must be addressed prior to the launch of any new product or new brand. These are: (1) understanding the elements driving the trial interest, (2) assessing the effect the new product will have on the brand or company equity, and (3) understanding the "cannibalization effect" the brand will have on the category and, most importantly, on the current products provided by the company.

The first priority, of course, is to understand the trial potential of the idea—how likely it is that the intended target will try the product. By quantitatively testing early in the development process, successful marketers must answer these important questions:

• Does the idea have a compelling benefit?
  
  
• Does it offer consumers something they cannot get anywhere else?
  
  
• Does it provide them with the proof that will give them the confidence the product will perform?
  
  
• Is it priced right?
  
  
• Are there any additional insights that can help best ensure the success of the initiative?

All of these questions need to be addressed when assessing the trial potential of new product ideas prior to launch.

The second critical issue that must be understood is what element(s) is/are central to driving the trial potential of the new idea. Using proven, industry-standard techniques like Thurston V Analytical or derived importance measures to understand the relative impact of claims, benefits, or other features of the new idea will help the company better focus its initiatives on the specific items that matter when it comes to motivating a moving target.

Rather than focusing communication on areas that are not deemed important, marketers should strive to unearth the drivers, using either quantitative or a combination of qualitative and quantitative hybrid techniques to uncover consumer motivations. Obviously, understanding what is most important to consumers will make marketing communication efforts more efficient and, in the end, more productive and rewarding.

The third critical priority that needs to be addressed is one that is often overlooked. While an idea might appear to have strong potential to build the brand from an emotional and equity standpoint, examining the potential of an idea in a vacuum can be very deceiving. In many cases, marketers have little sense of the impact a line extension will have on the performance of their entire brand—until it's too late. Marketers need to understand the cannibalization impact of every product launch.

The problem with only looking at trial potential in the absolute, without an understanding of cannibalization, is that new product launches can wither away the strength of individual SKUs. With SKU proliferation at an all-time high and marketers scrambling to bring the latest and greatest to market, many are watering down their brands or increasing sales at the expense of the overall success of their companies.

Retailers closely examine the velocity of individual SKUs when effectively managing their categories. Launching a new product that does nothing more than capture most of its trial volume from its own "sister" SKUs will only thin out volume and put the overall brand distribution at risk. In addition, with increases in warehousing and distribution of the additional SKUs based on the compliance mandates imposed by big box stores, the new product could actually cost the company significant amounts of money over and above the mere cost of a failed product.

Knowing how a new product idea will impact brand performance early in the development process must be central to all new idea evaluations.

A look at two ideas can illustrate the importance of understanding this critical issue. These two ideas performed at very strong levels in quantitative testing. Looking at both ideas in the absolute, one might come to the conclusion that Idea #1 is the better idea to pursue because its purchase intent (PI) ratings are higher and consumers perceive it as being a better value than Idea #2.



In reality, Idea #1 is actually the weaker of the two opportunities. The problem with Idea #1 is that 55% of its trial volume is likely to be sourced from the brands within its own franchise. In the end, Idea #1 will only dilute the power of the franchise and potentially affect distribution of the line. Idea #2 is the better opportunity for this brand to pursue, but failing to understand these critical components raised during testing and the subsequent evaluation could cost millions of dollars—and brand managers their jobs.



And finally, the most neglected issue of all is simply whether or not this idea will do anything to build the equity profile of the brand? Too many companies today simply throw out without understanding whether or not they will enhance the overall standing of the brand or simply borrow from its goodwill. Assessing the equity-supporting or equity-building potential of an idea will help sort out the real winners from the short-term gainers.

While the recently launched Cinnamon Roll cereal from the Quaker Oatmeal brand might have tested positively among consumers, its launch raises some big questions relative to its ultimate impact on the equity of the brand.

Consider this: The ad tested showed a picture of a sticky, sweet cinnamon roll. Cinnamon rolls by their very nature aren't considered healthy—which is just the opposite of the equity of the Quaker Oatmeal brand. While in the short term this idea may help win share in the cereal segment, in the long term it will do little to help the communication or support of the brand position.

So the bottom line for marketing executives is to pay attention to the details, or your new idea will die a slow, painful death. Don't just look at the easy things like trial, but rather dig deeper to understand how to best communicate, how to best build your franchise volume, and how to best fulfill the brand mission of offering a compellingly differentiated message to consumers.

Early-stage testing will help address these critical issues. If it doesn't, brand managers are not getting a great value for their research spend. You might be saving money using inferior and inexpensive testing methods or not testing at all, but in the end, the franchise will suffer, the spend will be inefficient, and the equity of the brand will cease to be unique.

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