Wednesday, December 04, 2013

Rogaine - lesson learned from innovation blunders

Here’s another great story with lessons learned from innovation blunders.

In this series of case studies, Hodock shares insight on avoiding 8 common mistakes in new product development. 

In the case of Rogaine, it was mismatched positioning.

Fifty million American men experience male-pattern baldness. In 1996, they received some very good news.  The Food and Drug Administration cleared Rogaine, a topical 2 percent minoxidil solution, as an over-the-counter hair regrowth drug for men and women with common hair loss. Hallelujah! Men suffering from hair loss often experienced “anxiety, loss of self-confidence and even depression”. Rogaine gave hair-challenged men a dual benefit—a full head of hair and the restoration of self-esteem.

Rogaine had a natural contagion, because the preliminary buzz purported it to be nothing short of a miracle. As a result, it had an avalanche of positive publicity prior to its market introduction. Wall Street was especially euphoric about Rogaine’s prospects, and its parent company, Upjohn (now Johnson & Johnson), did nothing to temper the financial cheerfulness coming from the street. In this situation, Rogaine’s positive buzz turned out to be destructive rather than helpful. Here’s why.

Balding males naively believed their departed hair follicles would return instantly by rubbing Rogaine into their scalps twice a day for a month or so. Rogaine initially attracted the most extreme cases of male-pattern baldness, primarily older males in their fifties and sixties desperately grasping for their youth. Rogaine could not deliver for these extreme cases. There was a deep ravine between positioning expectations and product delivery. 
Rogaine is a complex product, as explained to me by a Pfizer marketing executive. It is only effective in about 40 percent of the cases. It can take eight months to see the best results. The product is not particularly effective in cases of frontal baldness or receding hairlines. Compliance is essential to see any results. It must be used twice a day. If treatment is stopped, reversal occurs, losing any benefits from treatment. The application process—rubbing it into the scalp twice a day—is awkward.  Rogaine later attempted to make it easier with an aerosol foam version.  

Since many of the initial users represented extreme cases and a desire for instant gratification, they dripped out; their perceived expectations—“where’s my new hair??—weren’t instantly achieved. The buzz-worthy product was still talked about, but the talk turned negative from a large segment of disappointed men, dampening Rogaine’s prospects for marketplace success. 

Rogaine currently does target younger men with a more forthright approach that the product works for a certain type of male-pattern baldness, but it is not a panacea for every conceivable case of male baldness.
The makers of Rogaine made two major mistakes:

  1. Rogaine made no attempt to dismantle the early perceptions that it was a miracle product. This set an unrealistic level of expectation with respect to its product performance with the brand’s early bird customers.
  2. Rogaine required an extensive educational process to help men understand its strengths and limitations; this was never acted upon.

The net result was a wide gap between positioning expectations and product performance.

The product must be able to deliver on the positioning’s benefit promise, or there will be inevitable consumer backlash.  It’s hard to get the toothpaste back in the tube. That’s why marketers must get the positioning strategy right the first time out of the staring gate. 

Second chances are very rare. 

Rogaine never lived up to its potential, because the initial positioning and target segment were wrong from day one.

Tuesday, December 03, 2013

Motrin IB - lesson learned from innovation blunders

Here’s a great story with lessons learned from innovation blunders.

It’s an excerpt from Why (Smart Companies) Do Dumb Things by Calvin L. Hodock 

In this series of case studies, Hodock shares insight on avoiding 8 common mistakes in new product development.

Johnson and Johnson still needed an ibuprofen brand in its product portfolio, and it obtained it by swapping brands with Upjohn.  Motrin IB acquired in the swap, became a companion brand to Tylenol. The brand was so reasonable successful, riding the coattails of Advil, which had established the ibuprofen beachhead. Upjohn did not want to continue playing the expressive, high-stakes marketing game, which was absolutely essential in order to survive the competitive over-the-counter pain reliever market.

Motrin IB was viewed as a potentially strong global brand within Johnson and Johnson, but there remained the same issue that confronted Medipren—how to position Mortin IB in a way that protected Tylenol’s flanks.  The company understandably wanted to keep the milk flowing from the cash cow. This time Johnson and Johnson did some very good homework.

A segmentation study of the pain relief market revealed a segment of women who medicated aggressively. Very importantly, Tylenol was not heavily represented in the segment. This became Motrin IB’s target segment, and its initial “kick butt” advertising campaign worked brilliantly with these aggressive mediators while minimizing Tylenol cannibalization. It is possible to “have your cake and eat it too” with smart positioning.

Score another one for David Ogilvy. Positioning is one of marketing’s most important decisions. It is always out there in the marketplace, ready to perform miracles.

Monday, December 02, 2013

BOI Airport - where the on-time departures live

Remember those days when your plane landed and took off on time? They live on in Boise, which ranked No. 1 for fewest flight delays. 

TRAVEL + LEISURE readers gave it second place for location and third for check-in, suggesting that it’s the very model of an efficient airport. 

Admittedly, food and shopping are not good reasons to linger, but its small size and free Wi-Fi make it one of the easier airports to handle.

And for me, now that it offers TSA Pre-Check, the lines are even shorter and the experience is even better.

Sunday, December 01, 2013

Chartering New Lands & Appreciating the Holidays

Here's a note shared with me by Nick Neonakis, a consultant with FranChoice and author of The Franchise MBA

 It is my belief that as Americans, we have an innate entrepreneurial drive.  All of us have our roots somewhere else and our forebears all came to this country seeking freedom and independence.  If you want to think of the entrepreneurs in your family, your ancestor who first came to this country certainly is an important one!  Whether shown through the entrepreneurial bravery in coming here or in starting a business, ours has always been a country that rewards ambitious immigrants.  In fact, 40% of all Fortune 500 companies were founded by an immigrant or the child of an immigrant.

In September 1620, a small ship called the Mayflower left Plymouth, England, carrying 102 passengers—an assortment of religious separatists seeking a new home where they could freely practice their faith and other individuals lured by the promise of prosperity and land ownership in the New World. After a treacherous and uncomfortable crossing that lasted 66 days, they dropped anchor near the tip of Cape Cod, far north of their intended destination at the mouth of the Hudson River. One month later, the Mayflower crossed Massachusetts Bay, where the Pilgrims, as they are now commonly known, began the work of establishing a village at Plymouth.

Throughout that first brutal winter, most of the colonists remained on board the ship, where they suffered from exposure, scurvy and outbreaks of contagious disease. Only half of the Mayflower’s original passengers and crew lived to see their first New England spring.  It was here they met Squanto the Abenaki Indian who taught the Pilgrims, weakened by malnutrition and illness, how to cultivate corn, extract sap from maple trees, catch fish in the rivers and avoid poisonous plants. He also helped the settlers forge an alliance with the Wampanoag, a local tribe, which would endure for more than 50 years and tragically remains one of the sole examples of harmony between European colonists and Native Americans.

In November 1621, after the Pilgrims’ first corn harvest proved successful, Governor William Bradford organized a celebratory feast and invited a group of the fledgling colony’s Native American allies, including the Wampanoag chief Massasoit. Now remembered as American’s “first Thanksgiving”—although the Pilgrims themselves may not have used the term at the time—the festival lasted for three days. While no record exists of the historic banquet’s exact menu, the Pilgrim chronicler Edward Winslow wrote in his journal that Governor Bradford sent four men on a “fowling” mission in preparation for the event, and that the Wampanoag guests arrived bearing five deer.

The bravery these people showed in picking up their belongings and sailing over the horizon to start a new life is embodied by the thousands of men and women who start a new business every year in the USA.  As we wrap up the Thanksgiving holiday, let’s be thankful for all of their (and our) sacrifices as we make this world a better place.