Are We Really Blind to the Obvious????

While working on a new presentation that will be given to the MBA students at the Universities of Miami and Xavier as well as the MMR students at the University of Georgia, I realized how easy it would be to make two major contributions to the way of doing business.  The two major contributions are:  reduce our 90% market failure rate and increase sales.

Reducing our 90% failure rate would only require a little management discipline and organization.  Since retiring, it has been my observation that there appears to be very little structure in the moving of an idea to the marketplace.  Few companies appear to have a "product launch model" or organized approach tot he development of the idea.  And some of those that do have a good model, frequently will ignore the required steps.  The reason given is that it takes too long and costs too much.  No one seems to factor in the loss due to market failure or even the loss of a potentially good market success if the idea is rejected because of inadequate preparation.  (Mr. Thomas Kuczmarski, in his book Innovation, beats up on management's lack of acceptance of a systematic, well-defined and commonly understood product development process.)

Increasing sales appears to be a little easier than convincing management to practice a little discipline and organization.  I wonder how many working to increase the sales of their brands are blind, as I have been, to a very simple fact.  This fact has been staring me in the face for years.  I had the data years ago and did not realize its message.  Let me digress.

Years ago, more years than I care to cite, I was exploring the merits of end aisle caps versus shelf talkers.  I remember conducting a test looking at the impact of end aisle displays with shelf talkers.  I placed shelf talkers on a brand in the store aisle and measured the sales advantage of the shelf talker.  I also compared the results with the same product at the same cost when it was featured on an end aisle cap.

The results of the study indicated that there was a seven-fold increase in sales of the end aisle display over the shelf talker in aisle display.  At the time it was my hypothesis that the end aisle display was more effective because the respondents operated under the assumption that the displayed item was on sale at a cost less than the normal everyday cost.  A secondary assumption was that the brand was more visible and therefore acted as a reminder to those that may have a need for the product.

While right, the above assumptions are incomplete.  My major failure was assuming that the traffic past the end aisle display and the shelf display was virtually equal.  Oh, how far from the truth.  Back a half century ago when I was setting up supermarkets for A&P, the stores were designed with aisles that encouraged one-way traffic which in turn encouraged each shopper to travel each and every aisle in every shopping trip to the grocery store.  This is far from the truth today.  In a study of 200,000 shopping trips, only 1% of the trips covered 75% or more of the store.  Actually only 16% of the shopping trips covered half the store.  It's not difficult to see that a product on the store shelf has much less visibility than one on an end aisle display.  Add the fact that over half the sales of most brands are spontaneous, a seven-fold sales advantage is not difficult to imagine under these conditions.

Is it hard to believe that increased exposure would increase sales?  Just give the shopper one more reason to travel down your brand's store aisle and a reason to notice your brand on the shelf.

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