I’ve recently trained an FMCG company and the Sales Managers were having issues with hitting their sales targets. Their verdict on this? The beverage market is shrinking. I then told them, the beverage market is NOT shrinking… instead, it is rapidly changing or simply, have already changed. They gave me puzzled looks.
I proceeded to ask them; have you seen a Starbucks closed down? – Not me.
I continued to ask more; have you seen the queue of those bubble tea companies? – It’s long…
Present consumers are actually willing to spend 3X the price of your product, and so the market is not shrinking; instead, it has evolved.
But, did you guys changed according to the market? Or, are you still happily selling your famous product? Which, by the way, doesn’t require any selling or innovations. Changing the packaging once a while provides freshness to the product and that is considered as product innovation.
Product innovation can also mean hitting the premium market with higher quality products.
Are you up to challenge your business model or mass-market just like Kodak? The engineers innovated digital technology but because they were in the film business, they do not want to challenge their existing workable business model.
What about channel innovation? Have you thought of new ways to attract your customers to buy from you? Traditionally, you were only strong in key accounts and general trades. What about the HORECA (hotels, restaurants, cafes)? Online purchasing has changed the face of retail sales forever. Nowadays, my wife purchases diapers from the internet; omitting the hassle of having to carry those huge packages around. She selects and buys numerous Korean and Japanese cosmetics simply just by reading online written and video reviews. Do you still think you should stick to the traditional way?
Well, innovate or die. Take the automobile industry for instance; imagine if the car companies keep launching petrol cars instead of hybrids or electric cars. While the rest of the world is innovating, you cannot continue producing solid petrol engines, when the development and demand for electric cars are already in the market and growing.
The game is to break the current model to rebuild a new model. We can choose to stay the same and be comfortable. Past success experiences indeed give us confidence and feed our ego, but it is certainly not a passport to the ever-changing business landscape.
We can either stay safe or strive to create a better future together.
Friends, the advice is to either innovate or die…
