Private Label VS-or-WITH the Brand..? » MORE EFFECTIVE INNOVATION BY BRINGING RB & PL INTO THE SAME PLAN April 4th 2014, Costas Papaikonomou, co-founder @ Happen.com © Happen.com 2014. All Rights Reserved 2 Happen® Group Mass Market Opportunity happen.com winkle.eu other © Happen.com 2014. All Rights Reserved Innovation Success 3 Our trade: successful differentiation in crowded markets © Happen.com 2014. All Rights Reserved Next ±25 mins 4 Topics The CapEx challenge in effective innovation PL as opportunity rather than a threat Innovating for category pull versus product push Creating a self-funding innovation cycle © Happen.com 2014. All Rights Reserved 5 Spectrum of Innovation From our experience of creating and validating 10,000+ concepts across countless global categories SUPERSEDE STRENGTHEN EVERYTHING COMMODOTIZES, ALWAYS. YOU WILL BE revenue potential & risk transformational Game Changers STRETCH Adjacencies, extending core into new spaces STRENGTHEN Core EPD/NPD maintaining relevance COPIED. low operational SUPERSED E high impact on business STRETCH infancy growth category evolution over time © Happen.com 2014. All Rights Reserved mature 6 Spectrum of Innovation From our experience of creating and validating 10,000+ concepts across countless global categories SUPERSED E Extending from generic product into new occasions and categories Game Changers Enter stretch adjacent Brand to drive with category differentiated sales proposition STRENGTHEN Core Lurpak SlowEPD/NPD Churned maintaining relevance Driving brand premiumisation & category price point. infancy M&S Half & Half Loaf Great new benefit, drives sales, footfall and margin growth category evolution over time © Happen.com 2014. All Rights Reserved mature SUPERSEDE STRETCH STRENGTHEN STRETCH Adjacencies, extending core into new spaces Arla BabyWing and Me Co low operational Royal Peijnenburg revenue potential & risk transformational New route to market leveraging logistics infrastructure high impact on business Tesco App 7 Spectrum of Innovation From our experience of creating and validating 10,000+ concepts across countless global categories SUPERSED E Extending from generic product into new occasions and categories Game Changers Enter stretch adjacent Brand to drive with category differentiated sales proposition STRENGTHEN Core Lurpak SlowEPD/NPD Churned maintaining relevance Driving brand premiumisation & category price point. infancy M&S Half & Half Loaf Great new benefit, drives sales, footfall and margin growth category evolution over time © Happen.com 2014. All Rights Reserved mature SUPERSEDE STRETCH STRENGTHEN STRETCH Adjacencies, extending core into new spaces Arla BabyWing and Me Co low operational Royal Peijnenburg revenue potential & risk transformational New route to market leveraging logistics infrastructure high impact on business Tesco App 8 YOU WILL BE COPIED. © Happen.com 2014. All Rights Reserved 9 © Happen.com 2014. All Rights Reserved 10 Brand team OR Retailer Private Label? © Happen.com 2014. All Rights Reserved 11 Spectrum of Innovation From our experience of creating and validating 10,000+ concepts across countless global categories SUPERSEDE Game Changers STRETCH Adjacencies, extending core into new spaces STRENGTHEN Core EPD/NPD maintaining relevance infancy What’s most difficult to launch? growth category evolution over time © Happen.com 2014. All Rights Reserved mature STRENGTHEN revenue potential & risk transformational SUPERSED E low operational What’s easiest to copy? high impact on business STRETCH 12 Cash. ROI. CapEx. You’re in a hurry. Branded LAUNCH PL COPY LAUNCH CAPEX ROI RACE … WILL WE MAKE IT? MARGINS, USP, NEGOTIATING POWER © Happen.com 2014. All Rights Reserved 13 And you’ve just invested in this mother © Happen.com 2014. All Rights Reserved 14 Two views on ROI. #1: RACE HARDER Branded LAUNCH CAPEX ROI RACE PL COPY LAUNCH £££ MARGINS, USP, NEGOTIATING POWER Earn back fast, work hard and pray it goes well. © Happen.com 2014. All Rights Reserved 15 © Happen.com 2014. All Rights Reserved 16 Two views on ROI. #2: MAKE PL PART OF YOUR ROI PLAN Branded LAUNCH PL COPY LAUNCH CAPEX ROI RACE MARGINS, USP, NEGOTIATE NEGOTIATING MARGINS, USP,POWER … Earn back fast, work hard and pray it goes well. © Happen.com 2014. All Rights Reserved 17 © Happen.com 2014. All Rights Reserved 18 © Happen.com 2014. All Rights Reserved 19 Spectrum of Innovation From our experience of creating and validating 10,000+ concepts across countless global categories transformational SUPERSED E Game Changers STRETCH Adjacencies, extending core into new spaces STRENGTHEN Core EPD/NPD maintaining relevance infancy growth category evolution over time © Happen.com 2014. All Rights Reserved STRENGTHEN How do you STRETCH & mature SUPERSEDE to the next S-Curve? low operational STRETCH revenue potential & risk If you PLAN to give away your core advantage, what do you do next? high impact on business SUPERSEDE 20 © Happen.com 2014. All Rights Reserved 21 © Happen.com 2014. All Rights Reserved 22 Navigating the innovation matrix What level? C/A/T levels honed to your strategic ambitions Innovation Impact Level Marketing Mix Sweat Asset NPD What to innovate? Levers are honed to your biz context Core EPD/NPD Enter adjacent Create new category Accelerate new cat’gory Product format $$$ Value threshold Typical Timeframe & Cost Make/Buy triggers Development model … and more Packaging RTM Biz Model Point of Purchase Value Equation More… When to do what? Sweet spots defined by specific triggers, like; Eternal Challenger Market saturation Price War …. etcetera © Happen.com 2014. All Rights Reserved How to innovate? KPI’s & models honed to your capabilities 23 9 Windows benefits & barriers SUPERSYSTEM Environment Occasion Shelf person A person consuming chewing the product gum SYSTEM Product in hand Packaging SUBSYSTEM Ingredients Packaging open/close PAST PRESENT Before product is picked or used Product in use FUTURE After product has been used © Happen.com 2014. All Rights Reserved 24 Meanwhile, back at the ranch What do you do once this baby runs smoothly? Optimize on cost: increase margin, in particular when PL stream kicks in. Sweat for value-add: incremental innovation stream on your branded product. © Happen.com 2014. All Rights Reserved 25 SWEAT® for value-add © Happen.com 2014. All Rights Reserved SWEAT® for value-add »Object Segmentation to ‘segmented solid’ Mini pikelets are made with the dual nozzle. What else can we do by creating custom nozzles? » Pikelet chains and interconnecting circles » New shapes (ovals, ribbons) © Happen.com 2014. All Rights Reserved SWEAT® for value-add Increasing curvature »Object Segmentation to ‘(highly) segmented solid’ » What could this do for crumpets, pikelets, pancakes? » Layers! © Happen.com 2014. All Rights Reserved 28 SWEAT® for value-add Visuals and/or Examples The difference it brings Technical principle and action steps CapEx Estimate 0k GBP CapEx estimate Feasibility indicator © Happen.com 2014. All Rights Reserved Launch Year What the plant can do right now. What the plant can do with minimal CapEx. © Happen.com 2014. All Rights Reserved Out of scope. Maybe for the next platform. 30 Spectrum of Innovation From our experience of creating and validating 10,000+ concepts across countless global categories revenue potential & risk Changers STRETCH Adjacencies, extending core into new spaces STRENGTHEN Core EPD/NPD maintaining relevance Incrementa l ‘branded’ advantage low operational transformational Big ‘Platform’ STRETCH CapEx innovation STRENGTHEN SUPERSED E cycles Game high impact on business SUPERSEDE infancy growth category evolution over time © Happen.com 2014. All Rights Reserved mature Contac t » Happen® New York Contact Melinda Lehman [email protected] 220 Water Street Unit 102 Brooklyn, New York 11201 USA » Happen® Amsterda Contact m Daniel Quinn [email protected] Korte Leidsedwarsstraat 12 1117RC Amsterdam » Happen® London » Happen® Sydney » Happen® Toronto Contact Mark Cowan [email protected] m Contact Martine Barrie [email protected] m Contact Megan Mitchell [email protected] m 2 Sutton Lane 54a Clerkenwell Road London EC1M 5PU 26 Grafton Avenue Naremburn NSW 2065 2 Gilead Place Toronto Ontario M5A 3C9 Australia Canada The Netherlands United Kingdom
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