Less time spent developing new concepts and exploring acquisitions that don't align to demand
Improvement in success rate of concepts tested (5%-10%)
Improvement in new product launch success (two-year new item sales, post-Demand Outlook)
When a company’s portfolio includes several different brands, it can be a challenge to determine which brands are best positioned for growth—and which ones are inadvertently competing against each other. ZS recently worked with the snacking division of a food manufacturer to not only better understand consumer demand but also develop strategies to grow their portfolio through real-time actionable data.
ZS leveraged our proprietary Demand Outlook framework and a new way of thinking about consumer demand based on Jobs Theory, developed by Harvard economist Clay Christensen. Jobs Theory holds that people don’t buy products, they hire them to achieve progress in a specific situation. This shifted the company’s focus from traditional product-centric strategy (“What can we offer the market?”) to a consumer-centered strategy (“How can we meet the needs of consumers?”). By understanding what jobs consumers are purchasing products for, the company could make smarter and more data-based decisions regarding how to invest across their portfolio.
During a period of rapid growth, the company launched several new product lines, but did not first consider the role those products played in their portfolio. Despite the investment, cannibalization between brands competing for the same consumer jobs meant that the launches fell flat, and the innovation and strategy teams lacked clarity about what to build or buy next as part of their pipeline efforts.
ZS fielded an in-depth study to over 10,000 consumers, capturing everything they ate, their needs and attitudes toward eating, the details of their consumption occasions and how satisfied they were with their chosen brands. Our approach included a proprietary algorithm that determined the vulnerability level of each product currently being purchased. Data gathered included the top benefits consumers sought from a product, details on why consumers prefer certain snacks for certain occasions, and, of course, which products consumers “hired” for a specific purpose, all combined with third-party volumetric point-of-sales data for an accurate read on the dollar opportunity in each job to be done.
Then we worked closely with multifunctional teams encompassing consumer insights, brand, strategy, innovation and sales to develop a single consumer landscape framework that identified consumer demand across segments and demand moments. These insights showed which brands performed well for their given jobs and where unmet needs existed that others could fill. This empowered the company to either “fire” brands that had no competitive standing or relocate legacy brands to jobs with opportunities to capture unsatisfied consumers. The Demand Outlook enabled the leaders of each brand to identify their current positioning and growth opportunities, by pinpointing where consumer needs were unmet today, which incumbents were most vulnerable to replacement and, critically, how to replace them by better delivering against consumer needs. Finally, ZS built a custom Digital Demand Outlook, an interactive web-based tool that enabled easy analysis of the data, empowering the client’s leaders to fully visualize consumers’ needs and project the investment required to grow.
By bringing to life jobs-centric demand theory (that postulates that consumers don’t buy products so much as they hire them to fulfill a specific need), ZS’s Demand Outlook reframed how the company invests and goes to market with its brands.
The partnership revealed new white space opportunities for key brands and innovation avenues worth up to $100 million. Both legacy and newly launched brands developed strategies to renovate or communicate to better deliver against specific objectives (such as satisfying an indulgence, or being easy to eat on-the-go), making them more focused and competitive. The Digital Demand Outlook also proved useful far beyond the life of a single project, allowing the client to refresh the data and insights, in order to continue to meet future trends well past the end of ZS’s official engagement.
Once the Demand Outlook clarified the company’s portfolio strategy, the client was able to make more informed decisions and optimize investments, from where to spend marketing dollars, to what product renovations and innovations were needed to target portfolio whitespace opportunities. The Demand Outlook also helped pave paths to new revenue for the company, as it helped the organization align against a clear target in a specific market worth $130 billion in annual snacking spend. By giving each brand a clear and distinct job to perform for different moments that that segment experiences, the company had the opportunity to dramatically expand their current $12B worth of sales to those consumers, unlocking billions of dollars in new growth in that market alone.