Three New Product Marketing Strategies: How to Plan for Success
To be successful in today’s highly competitive CPG industry, brands should develop new product marketing strategies that work in an ever-changing environment. By using agile innovation strategies, many challenger brands can compete with massive CPG conglomerates. Agile innovation is a strategy born in IT, but it is applicable in digital marketing—especially in the way it can be used to introduce a new product to a crowded market. By breaking down larger campaigns into smaller components, brands can create a strategy that’s flexible enough to adapt to changing consumer demand.
There is no one single new product launch plan that can be said to work for all brands, but of the plans that succeed, we can see common themes. A successful launch depends on timing, how the target audience is reached, and, above all, partnerships with the right platforms to drive product awareness. Through these strategies, brands can bring a product to market in a way that makes an impact.
Agile Innovation in Marketing
Agile innovation—as it applies to marketing—is a process that involves creating one large, overarching goal and breaking down the steps needed to get there. By breaking a CPG marketing campaign down to its basic components, there’s more flexibility in the process.
Hypothetically, if a brand was about to launch a new breakfast cereal—with an overall goal of gaining $1 million in sales in the first year—the brand would need to break that goal down to determine who would make those purchases, when they would make them, and how those consumers could best be reached.
Demographic
The brand should test market the cereal with adults and children to determine the target audience. For example, a child may request a particular cereal, and even pick it out in the store, but it will ultimately be the parent who purchases it. How will marketing efforts need to change to address both of these audiences?
Timing
When is the best time to go to market with this particular cereal with consideration for market demand? For example, a healthy cereal may sell better in January when people are trying to lose weight. Meanwhile, a children’s cereal may sell better during the summer, when kids are home from school.
Platform
Early test campaigns on specific platforms can help to reveal opportunities to gain an audience for a new product. As examples, the cereal brand might consider partnering with a mobile gaming company to reach kids and a shopping app like Shopkick to reach parents.
The benefit of breaking these tasks into components is that it allows rapid pivoting for a brand, which is what agile marketing is all about. As the digital space continues to change rapidly, with new products and campaigns appearing almost constantly, it’s essential to create a campaign that can easily be adjusted based on audience, platform, and timing.
Strategy #1: Understand Your Audience to Time Your Launch
Correct timing of a new product launch is imperative, as it will determine the demand of the market. Consider Unilever-owned ice cream brand Breyers. It’s no accident that the brand announced four new flavor mashups at the start of summer as this is a time of high demand for ice cream. However, timing isn’t always as obvious as that. Brands must consider several factors when launching a new product, including the following.
Season
Season may not seem like it impacts all product types, but it can. Consider sugar, as an example. Since sugar is used year-round, it might seem that season would not affect demand. However, consider the holiday season when consumers may be baking more and having more gatherings. This increased hosting—and baking—will increase demand during the holidays.
Culture
Sometimes, current events and popular culture can result in a sudden increase or decrease in demand for an entire category of products. A landmark case of this occurred in 2006, when the movie Blood Diamond was released, which highlighted some of the atrocities that happen in the diamond trade. Reputable jewelers became rightly concerned that it would impact sales even for stores that did not engage in any black-market dealings. Even if the seller was legal, releasing a new diamond collection at the time would have been a risky and controversial move.
Economy
Economic performance doesn’t feel like it should impact products with such low-price points, like some CPG products, but economic slumps absolutely can. When the economy is weak, consumers may use more coupons or switch to store brands, causing a drop in sales for brands at higher price points. On the other hand, a weak economy may be an ideal time for a discount challenger brand to compete, as consumers will have a more substantial focus on value.
Releasing a product at the wrong time makes it harder to gain attention. However, proper timing can be difficult to pinpoint as the causes aren’t apparent. Brands need to be able to understand why consumers choose to buy when they do. Mobile apps and the data they collect through user behaviors can offer an opportunity to CPG brands that want to calibrate their campaigns more effectively.
Strategy #2: Use Data to Focus on a Specific Audience
Oftentimes, only a small portion of the population determines the success of a new CPG product. In a study of over 40 million U.S. shoppers, just 1.5% accounted for 80% of purchases in the year following a new product launch. That means that brands should focus more on reaching the right consumers instead of all consumers.
One way to manage this can be through a beta launch using a shopping app. In this case, the brand may choose to make the new product available in a few areas and partner with a third-party shopping app that uses proximity marketing to drive awareness. With Shopkick’s app, as an example, brands can incentivize interactions with a specific product by offering kicks (aka rewards points) when consumers find and scan items in the store.
The brand can then use the data from those signals of purchase intent to determine the best audience for that specific product. For example, if they notice that most of their engagement is coming from women in their thirties with children, they can aim their marketing efforts to reach that specific group of consumers.
The benefit of doing this via a shopping app is it allows brands access to consumers who make purchase decisions for their household. As shopping apps are typically used while in-store and those who download and actively use them tend to be regular shoppers, the shopping app can essentially become a diverse focus group for brands to test the reception of each product. By identifying these consumers, brands are better able to connect with them on the digital platforms they use.
Strategy #3: Partner With the Right Platforms for Your Demographic
Partnering isn’t just about reaching out to consumers on a platform. It’s about understanding the resources available to brands. Most platforms offer a specific program for brands, which marketers have used with varying levels of success. A few different types of platforms to consider include the following.
Social Media
Social media is the obvious choice when it comes to brand marketing as these platforms typically offer many features that brands can use to reach specific audiences. Facebook Ads, as an example, give brands the opportunity to share ads with consumers based on age, interests, gender, and more, providing a chance to reach high potential sales leads.
Influencer Marketing
Influencer marketing isn’t driven by platform but instead by where the influencer chooses to maintain their following. Working with an influencer could include placing ads on that influencer’s website or on an existing platform like YouTube or Facebook.
Video Platforms
Video continues to be a significant engagement driver, with video content receiving 1200% more shares than text- or image-based content. Video platforms not only support video formats but also features like pre-roll ads and rewarded video, which tend to offer high sales conversion potential.
Propietary Apps
Brands can choose to create in-house apps to offer consumers another way to engage with them. This strategy is something we can see with Starbuck’s top branded app, which gives consumers the ability to make purchases and skip lines at the store, as well as obtain rewards points for purchases. By offering an app that supports the purchase of their product, that app becomes an extension of their product. The issue here is that consumers who use a branded app are likely already loyal to that brand, making this a difficult place to reach a new audience.
Third-Party Apps
Partnering with third-party apps allow brands to reach a new audience of consumers through that app’s user base. Third-party app partnerships with rewards programs as well as with popular gaming and mobile video apps work very well. These platforms provide consumers with an introduction to the brand, which can help to improve awareness of a new product.
All these platforms offer the opportunity for brands to connect with the correct audience to gain sales for new products. A few can even be a means of acquiring data ahead of a hard launch. In either case, a brand can go into the new product marketing campaign with more insight, increasing the likelihood of success.
Tying New Product Marketing Strategies Together
Breaking your marketing strategy into components makes it a much more flexible plan. In the digital age, a brand’s success with a new product will be determined based on its ability to pivot. Applying the standards of agile innovation to your marketing plan can help you gain that flexibility.
Testing marketing strategies through shopping apps can support all of this as it gives you insight into who is buying your product and why. The knowledge gained through this can help with the timing of your product launch as well as where to reach out to your target audience. Shopping apps can help improve your marketing strategies by giving you a better understanding of your consumers, which you can be ultimately used to improve sales.
Shopkick’s app allows our partners to harness the conversion potential and insights gained through an innovative shopping app that incentivizes consumer interaction. For more information about becoming a partner, contact us.
