Power Prospecting

Manufacturers are forever blessed and burdened with the task of creating new products and enhancing existing products to suit their customers' evolving needs, while also delivering growth to their organizations. Unfortunately, far more new product ideas are conceived than resources exist to introduce them. According to the global strategy and technology consulting firm Booz Allen Hamilton¹,

• for every seven concepts that enter the new product process, only one becomes a commercial success;
• 46% of resources devoted to new products are spent on products that fail or are cancelled.

Companies are striving to build better innovation processes to increase their odds of success in the marketplace. Innovation processes are designed with the goals of (1) minimizing risk; (2) spending development funds more effectively; (3) accelerating go-to-market initiatives; (4) dedicating sufficient resources for R&D; and (5) using a disciplined, scalable approach to continually monitor the viability of each potential product or enhancement as it moves through the innovation pipeline, beginning at the very earliest stages of innovation.

So, where does the innovation process really begin? Ideally, manufacturers develop a concrete innovation strategy based on the company or brand strategy, internal capabilities, and marketplace conditions (such as lifestyle trends, competitive activity, and technological advances). This strategy informs the company's `innovation platforms.' But what happens after that? Too often, companies jump straight into ideation with the strategic platforms they have identified. The problem? They are missing a critical step in the process.

With the high failure rate of new product introductions, new thinking about the innovation path that employs a more systematic, rigorous approach has emerged. Before engaging in brainstorming sessions to come up with new ideas, savvy clients are first making sure that they are pursuing the strongest areas of opportunity. By its very nature, an innovation platform is broad and strategic; it might be something like wellness or convenience. Conducting a brainstorming session for an area of that breadth can be quite challenging, even when limited to a specific brand. (Wellness for which target? In what format? What are consumers looking for, specifically, in the area of wellness that a specific brand can address?) Clients need solid evidence that the concepts they decide to pursue are in the right opportunity areas and that they are not missing any other opportunities.

That's where prospecting comes in. Prospecting is an important step in the innovation process that serves as a bridge between innovation strategy (platform identification) and idea generation. Prospecting is the process of delving deep into the platform areas to generate consumer insights so that marketers can determine which areas they want to explore for new ideas.

A systematic approach to prospecting helps avoid a common pitfall in the innovation process: Suppose that a new idea is tested in a concept test and it doesn't meet the action standard. Does that mean that the idea was a poor one? Should you just throw out the idea? The ideal next step, if prospecting has been done correctly, would be to explore other ideas within the same area.

Prospecting seeks to identify undercapitalized consumer segments, under-leveraged trends, unmet consumer needs, and competitive vulnerabilities within the strategic platform areas. It employs a wide range of qualitative and quantitative tools and techniques to accomplish this. The goal? Insight identification leading to the best opportunity areas to pursue: these are called prospects. A prospect is

• a potential area of opportunity for developing new products or enhancements to meet consumers' needs;
• a very early `pre-idea'; a prospect is not a fully developed concept, and does not include branding, positioning, pricing, variety lineup, or emotional benefits;
• a high level articulation of an unmet consumer need.

An example of a prospect: A line of premium ice creams with 100% of the daily requirements of calcium and vitamin D.

Prospects are certainly not ready for traditional concept screening, as there is not enough information from which to develop a concept. However, research at this stage is crucial to ensuring that product development is being steered in the right direction and that resources are being devoted to the most promising opportunities. At this critical stage of the innovation process, qualitative research alone usually does not offer enough proof for a go or no-go decision.

185Robert G. Cooper. " The NewProd System: The Industry Experience, " Journal of Product Innovation Management 9 (1985) : 2.