Looking for a breakthrough innovation? Are you asking the right questions…?
By Susie Milburn
In CPG, breakthrough innovation is a bold and urgent ambition in a world of copy-cat brands, rapid growth of private label, price inflation and changes to distribution channels. And that’s not just for marketers – finance teams, R&D teams and sales teams have a lot to win (and lose) when it comes to innovation.
In the first half of last year, only 35% of global CPG launches were genuinely new products – now this might seem high to some of us, but what’s worrying is that it’s the lowest since Mintel began tracking this number in 1996. In a world where innovation is on the rise in other categories, we should be worried, if not alarmed by this stat and even more so if we’re a market leader facing the growth of newer category entrants who are pushing the boat out when it comes category redefining innovation. And given the advances in R&D, consumer insight, and new distribution channels, shouldn’t this be trending in the opposite direction?
Of course, it’s overly simplistic to think that increased capabilities = better innovation, the huge investment required in a time of rising cost-pressures can be seen as a risk, and the ever-tightening regulatory environment can make product innovation costlier, slower and a lot harder. But, at the same time, there are smaller, newer Challenger brands succeeding, often with significantly less resource than the global CPG giants. So, as the experts in a Challenger Mindset, we’re interested in what we can learn from how.
In our experience, when looking at truly innovative new ideas, there’s one behaviour that occurs time and time again: intelligent naivety.
By this, we don’t mean doing the opposite of what everyone else is doing. We mean bringing a fresh and dynamic set of questions to the category, a set of questions that deliberately breaks with the immediate past of the category (and our brand if we’re the established player) to look at what we can learn from other industries. Method’s distinctive product range when they entered the market is a classic example of that – they challenged the category’s incumbent thinking that the more powerful looking the better when it comes to cleaning products, instead looking outside their category to borrow codes from beauty and perfume.
image: Method
Now this might sound like the opposite of everything we know to be true of say ‘best practice’ when it comes to innovation, especially in household CPG where efficacy is so important. “But my research department knows EVERYTHING there is to know about how to create even whiter whitening in dentalcare!” I hear you cry.
But let’s stay with the dental category because there’s a lot to learn from hello toothpaste who went from launch to a $350m acquisition by Colgate-Palmolive in 7 years.
image: hello
While Colgate, Crest and Oral B were obsessing over how to fight gum disease or attack plaque, hello’s founder, Craig Dubitsky, told us, “I looked at oral care and saw oral scare.” So he asked a very different question: why is the toothpaste category so scary? This simple question led them to radically challenge every dimension of toothpaste as it was – from the ingredients, to the language, the taste, the packaging and even the brand and its personality. And their success is not just due to a nice, friendly brand that looks cuter than the somewhat aggressive competitors on shelf.
image: hello
hello’s intelligently naïve question required their R&D team to find all natural ingredients that are more effective, premium looking packaging that can be recyclable, flavours that still give the fresh tingle of artificial spearmint, supply chain transparency, and the list goes on. This behaviour has continued to lead innovation within their products – “Why do you brush with the same product at the end of day that you use the beginning of your day?” led to flavors specifically designed for morning and night, “Why can’t brushing your teeth be magical?” has unlocked products like Unicorn Sparkle and Dragon Dazzle. Or even looking at other categories like beauty for the growing efficacy and popularity of Vitamin C to create a vitamin C whitening toothpaste.
image: Vacation
Even in the most regulated and scientific categories, intelligent naivety can lead to breakthrough innovation. As someone for whom anything before SPF 50 is not an option, Vacation Inc is one of my favourite examples of this. In a sea of protection and safety, they asked why suncream can’t be more fun – after all, it is largely associated with holidays or summer, and what’s not fun about that? Not only is their whole brand built around this idea of leisure enhancing sunscreen – but their products reflect this too. They steal with pride from what’s working in the indulgent side of the food category: Classic Whip is suncream that looks more like a dessert and their Chardonnay Oil sounds more like something you’d have at sundown. These aren’t frivolous innovations either – they’re rooted in stealing with pride from what works in other categories, and as Vacation’s Classic Whip’s sales show, it’s a formula that works, having sold out four consecutive times by mid-2023.