Off the Shelf: The Retail & CPG Blog

It has always fascinated me that most Research and Development labs have thousands of ideas and concepts that are developed, evaluated, striken off, re evaluated and finally a few make it through the new product development cycle. The sheer number that trickles down the funnel to make it to a new product is mind boggling. However, in a number of industries (excluding highly structured R&D organizations like Pharmaceuticals), the underlying science of developing these concepts has not been tied to streamlining and managing it like a project. While we all understand that R&D is also an art, the view from the shareholder value also puts a focus on more streamlined and higher visibility into this process so that it is more integrated into the overall Marketing framework of the company and brings about more predictability into the new product pipeline.

We are seeing more R&D organizations embracing these aspects by:

-          Using integrated project management tools that not only provide visibility to the concept development but involves the Marketing organization as a key stakeholder in the process to provide feedback.

-          Standardizing the Gating process across Global and Regional level New Product Development process.

-          Minimizing manual work and updates

-          Providing Tools / Mechanism for most accurate and streamlined communications between the teams that is involved in NPD Process globally, to increase the productivity and reduce rework.

-          Providing better reporting tools to track KPI's across the NPD Organization.

Are you seeing this happening more in your organization ? After the initial wave of streamlining the new product development is this the next wave of collaboration for New Product Development

Posted by Kapil Khanduja at 6:49 PM | Permalink | Comments (0) | TrackBacks (0)

It has been a very interesting couple of years to watch the CPG companies building their social interactions with their consumers to obviously promote brand loyalty. The fragmentation of the media interactions have left the companies in a tough spot to choose where to invest and how the brand should be built out in the specific media channel. Some of the forays have been highly successful, where as some of them have not succeeded at all. But the iterative nature of the marketing options is what is making it interesting. Something that succeeds can be easily copied, but as is usual with the powerful brands, there is always something new that is introduced in the concept.

Some of the ideas that have succeeded, some have become almost imperative and some have failed

1.       Brand extensions through interactive applications: These have been especially successful for food products. Interactive recipes with ingredients, new ideas, store locations have made these the standard for each line of food products.

2.       Facebook pages: Every Brand has to have One. How they leverage the pages, the content, the ideas vary a lot (and are also limited by what Facebook offers).  Some companies have extended the association of the brands with the consumers (Read Thank You Mom) and have had fantastic results while others are just also exists. These would fall in the category of required - rather than successful or unsuccessful.

3.       Games: This is where I have failed to understand the Brand's and how they are trying to get increased consumer loyalty with brand centric games. None of the Brand centric games have reached a level of following compared to any of the commercially released games (and I am not just looking at the success of Angry Birds). Is there a point in churning out these games which actually might be diluting the brand image.

The underlying challenge is that the same brand is being promoted through different media and hence you want to extend the same messaging through the different media's. Do you think that the companies have to think of their brand positioning differently? Is there a need for different brand for the digital media that can augment the overall company image?

Posted by Kapil Khanduja at 5:55 PM | Permalink | Comments (0) | TrackBacks (0)

We are in the day and age of the Digital Consumer. Where you like a song you hear, you download it on your smartphone/tablets/computers. Games, Books are available on your fingertips. The ideal world to promote impulse buying leading to instant gratification.  However, the other end of the spectrum is the buying behavior that delays this impulse buying or instant gratification. Consumers no longer walk into a store and buy things. They need to do comparison shopping and buy online if they find better pricing. They are willing to wait for the item to be shipped. I am sure the retailers would be very interested in cracking this paradox: what makes it a consumer who is so used to gratifying his needs, willing to wait a few days (by ordering online) for an item that he could have picked up in the store. The manufacturers are also keen to understand this as a delayed buying could imply more brand choices leading the consumers away from their brands.

Of course, there are various considerations that could explain this 'delayed instant gratification' in a physical store. Some of them being:

1.       Categories: You would never do an impulse buy of a large item (a washing machine, a computer, a tablet). And you would not think twice about buying groceries. However, there are certain categories on the borderline - especially Apparel which give instant gratification but also could be delayed.

2.       Price/Value: Closely related to categories - but is also based on the price. Usually the things being brought in store are of a higher price than what consumers buy online. Its easy to buy a 99 cent song on itunes than to decide in an instant on a $50 shirt in store.

3.       Pricing differential : The difference in pricing between B&M stores and online stores could be quite high for the same item. For obvious reasons, the difference between stores and online world exists today due to the difference in models.  

The big question is that what price and price differential does it become significant to the consumer to delay the buy. How do you get into the mind of the consumer to determine how this decision could be made instantaneous benefitting the retailer and the manufacturer.

Any thoughts/feedback on the consumer behavior - how does this affect you in your daily buying behavior.

Posted by Kapil Khanduja at 3:54 PM | Permalink | Comments (0) | TrackBacks (0)

Proper monitoring is fundamental to the operation of any high-performance eCommerce site.   The reason for this is that it is very difficult to validate that code is correct prior to going live, given the limitations of the testing process, and the limited time available to properly test.  As a result, we test a little, and then throw the code over the wall to the user.

In an ideal world, the competition would test their code better, thereby giving us enough time to test ours.  This may become the norm in ten or fifteen years, but for now, everyone is running as fast as they can, and very few eCommerce businesses would feel comfortable slowing down.

An alternative is to accept the fact that you are not going to get the time to test prior to going live.  All is not hopeless, as there is no reason that you can't keep testing a system after it goes live.  Normally, this type of testing is called monitoring, but it resembles testing in that data is gathered that indicates where the system is having problems.  The fact that the transactions are real rather than synthetic is actually a positive, if the user frustration is not intolerable.

For example, if you go live with your new version of your eCommerce site in August, it may be fine for today's loads.  By monitoring and continuously improving, you may be able to get it ready for the holidays, even if it is not ready on the first day in production.

·         24x7 Health Monitoring - examining performance and behavior metrics on an ongoing basis with a goal of spotting problems before they become serious.

·         Incident Detection and Notification - the notification of the correct resource whenever a critical metric deviates from an acceptable range so that remedial action can be taken

·         Rapid Triage - finding a way to get the site back up as quickly as possible.

·         Root Cause Analysis - investigating a problem with a goal of finding the root cause and designing a permanent solution.

·         Continuous improvement - Code written by vendor partners is very difficult to assess for quality of construction.  The best practice for ensuring that quality code is being delivered is to proactively examining all aspects of the site after each release.  The goal of the examination is to identify poorly coded sections, improve the response time (as experienced by the user), increase the throughput, forecast future hardware needs, increase the site's stability, etc.

Here are my recommendations for how to monitor to achieve each goal:

·         24x7 Health Monitoring

·         Install a "Quality of Service" monitor for every hardware and software system whose performance is critical to maintain the site's scalability.

·         Create Alerts to fire whenever a "Quality of Service" threshold falls below a minimum.

·         Create a series of dashboards for Level 1 and Level2 support to monitor that shows the overall health of the environment.

·         Provide Standard Operating Procedures for the support team to follow for any unhealthy conditions.

·         Incident Detection

·         Install a heartbeat monitor for every hardware and software component whose availability is required for the site to be selling.

·         Create Alerts to fire whenever a critical heartbeat is lost.

·         Create a series of dashboards for Level 1  and Level2 support to  see what is up and what is down

·         Provide Standard Operating Procedures for the support team to follow for addressing a server failure

·         Rapid Triage

·         Install an application-level profiler like Dynatrace in both the Pre-Production and Production environments.

·         Train the Level 2 support staff to the profiler to quickly discover what part of the code is the performing badly

·         Provide Standard Operating Procedures for the support team to follow depending on where the problem is localized

·         Root Cause Analysis

·         Install an application-level profiler in both the Pre-Production and Production environments.

·         Use Tealeaf to isolate a transaction that triggered the undesirable result

·         Train Level 3 support in the use of the profiler evaluate the application's behavior during the unsuccessful user experience.

·         Isolate the root cause and submit it to the architecture team to design a fix of the problem.

·         Continuous Improvement

·         Install an application-level profiler in both the Pre-Production and Production environments.

·         Profile every new code drop both before and after it is put into production to detect components that are performing poorly.

·         Isolate the root cause and submit it to the architecture team to design a fix of the problem.

If you instrument your site this well, you will be able to maintain you site a the high-level that your customers desire but rarely experience.

Posted by Stephen Alan Potts at 4:28 PM | Permalink | Comments (0) | TrackBacks (0)

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