The other night, I saw an ad from Kraft Foods on a “new” cereal – just bunches! Though, not a consumer of this tasty meal, the ad story got my attention immediately. What stroke me – is the way the plot unfolds in the ad – it does depict a process when adding a new value can revive an existing product or come up with an extension. All you do is magnify one feature or functionality (like increasing a TV screen produced a market for home theaters), or eliminate a feature (like with the above mentioned Honey Bunch Oats, no flakes – just bunches).
There are three core strategies that can be examined in the market to demonstrate revitalization:
1. Adding a new value – usually this is the way to look for creative opportunities to redefine the product. Sony executed this strategy when it created the Walkman, while it replaced speakers with a headset. The minivan combined the benefits of a station wagon and a van. In can even go way further into creating a hybrid from two products that are so unrelated, but when merged create a “new” niche product. Michael Gibbert and David Mazursky call those category revolutions or “cross-breeds” in their article on combining two categories to come up with new products.
2. Repositioning – involves creating a new competitive position in the minds of the consumers. Many a times, it can be classified as a bit controversial or far-fetched from the status quo. Examples include utilizing some social trend in a reverse manner – with a wireless technology being built in various products – some coffee shops or service establishments chose to create a demand for anti-technology while jamming some sections of their establishments to provide cell free and wireless free zones for its customers. Or like the mentioned Ikea store experience, where no sales assistance store experience is accepted by customers in lieu of other benefits (specific ambiance, cafe, etc).
3. Extending the base – implies increasing the adoption rate, usage rate or entering new markets. To figure its feasibility, product managers would profile the customers that tend to buy more than average or consume more than average and find out what causes them to do that. Another way to do so is to find unusual customers or product usage patterns that lead to defining new segments. Example of this approach is Superior Clay Corporation that reacted to its clay sewer pipes being replaceed by plastic. It did discover a new niche for decorative chimney pots and fireplace flue liners.
Whatever strategy one might apply, sometimes killing a product could be the best solution. Thus, it is critical to assess its performance, demand and potential costs before exercising any of the above-illustrated options!