尼尔森-Whats-Next-in-Innovation_15页_320kb

Summary of "WHAT'S NEXT IN INNOVATION: KEY LEARNINGS FOR NEW PRODUCT SUCCESS IN LATIN AMERICA"

Core Content

This document explores the importance of innovation in the Latin American market, particularly for Fast-Moving Consumer Goods (FMCG) companies, and outlines the key steps and considerations for developing and deploying successful new products. It emphasizes the need for a structured, end-to-end innovation process that aligns with evolving consumer behaviors, preferences, and market dynamics.

Main Points

Why Innovation is Critical in Latin America

• Latin America has experienced flat FMCG sales (2017 volume growth: +0.2%).
• Consumers are cautious and sensitive to price increases, favoring savings and discount formats.
• Many believe their countries are in recession (73% according to the 2017 Global Consumer Confidence Survey).
• Innovation is essential for business resilience and growth in a slow-growth environment.
• Consumers are willing to pay premium prices for innovative products but feel the market lacks sufficient innovation.

Why Innovation Fails

• Weak Proposal: Products that don't address real consumer needs.

• Wrong Product Design: Ideas not translated into effective, consumer-friendly products.

• Poor Media and Store Activation: Inadequate marketing and distribution support.

• Over 20,000 new products are launched annually in Latin America.

• Half of these fail in the second year, and over 30% don't stay in stores for more than a year.

• Many companies invest heavily in innovation but fail to align with consumer expectations.

Turning Barriers into Opportunities

• Innovation should be a structured process with three key stages: Discover, Develop, and Deploy.
• Brands must focus on identifying real consumer challenges, creating concepts that solve them, and then developing and launching products with strong media and store support.

Key Steps for Innovation Success

First Step: Identify

• Discover an attractive proposal: Address real consumer needs, not just replicate products.
• Understand local preferences: Develop products tailored to regional needs.
• Common needs: Convenience, ease, and solving daily challenges.
• Examples: A toilet paper product with a secondary roll for on-the-go use in Colombia.

Second Step: Develop

• Concept testing is crucial: Only 23% of 500+ concepts in 2016 were ready for successful launch.
• 77% of failed concepts didn't solve real consumer needs or offer clear value.
• Package design is vital: 65% of consumers try new products based on packaging.
• Nielsen insights: Optimized packaging can increase sales by 5.5%.

Third Step: Deploy

• Execution excellence is key: Brands need to invest in both media and in-store activation.
• Media and distribution should be aligned: Start advertising and distribution simultaneously to avoid lost opportunities.
• Television remains dominant: It drives initial trials, followed by in-store presence.
• Long-term support is essential: Most failed innovations lack sustained marketing investment.

Media and Marketing Considerations

• Advertising themes: Health (52%), family (48%), and relatable situations (44%) are most valued.
• Digital advertising is growing: 22% of total ad spend in 2018, expected to reach 30% by 2020.
• In-store availability is critical: Products must be replenished quickly to avoid losing up to 30% of potential sales.

Guidelines for Innovation

1. Identify a real struggle
2. Create an offer congruent with the problem
3. Evaluate early success probability
4. Develop a bundle that matches the promise (right product, package, and price)
5. Forecast sales and plan accordingly
6. Align execution with the proposition
7. Provide long-term support

How Nielsen Can Help

• Discover: Identify growth opportunities, build compelling propositions, and measure their potential.
• Develop: Create winning product bundles, design effective packaging, and develop clear communications.
• Deploy: Execute strong in-market activation, optimize portfolio and pricing, and track performance for continuous improvement.

Supporting Data Sources

• Nielsen Consumer Packaging Trends Survey (United States: 2016)
• Nielsen Design Impact Award (2017)
• Nielsen Global Consumer Confidence Index Survey (Q2 2016, Q2 2017)
• Nielsen Global Database: Factors for Success and Factor Validation Study (2016)
• Nielsen Global Trust in Advertising Survey (Q1 2015)
• Nielsen Innovation 3D Framework (2016)
• Nielsen Innovation Global Survey (Q2 2015)
• Nielsen Innovation Test Learnings (2016)
• Nielsen Marketing Mix, Mix of Incremental Volume (Latin America: 2016)
• Nielsen Packaging Sells (2015)
• Nielsen Retail Index: New SKUs per year (Mexico, Brazil, Colombia, Chile, Argentina: 2016)
• Nielsen Store Execution: Real forecasted case (Mexico: 2016)

Conclusion

Innovation in Latin America requires a deep understanding of consumer needs, a structured process, and strong media and in-store support. Companies must move beyond mere product development to create value through convenience, premiumization, brand power, and novelty. With the right approach and data-driven insights, brands can turn innovation into a competitive advantage.