Post on 22-Oct-2014
description
transcript
Page 1
Innovation:Innovation:
Some Holistic ThoughtsSome Holistic Thoughts
Colin Gordon, CEO
Glanbia Consumer Foods Ireland
12th May 2009
Page 2
Who in this room hasn’t spent time thinking about…..
qHealth and wellbeing
qLifestage (kids and older people)
qIndulgence
qConvenience
qOn the go
qOrganic
qFair trade
qSustainability
Page 3
Innovation
Product
Idea
Model
Comms
Page 4
Innovation is all about
•Change
•The Future
•A Dynamic
It’s proactive …… and
reactive
• Innovation is necessary:
consumers/trade
changing anyway (cause
and effect?)
Innovation in “Food”
essential
> val. +3.1% CAGR
1998-2008
> vol. +0/4% CAGR
1998-2008.
Page 5
Source: Millward Brown Optimor (including
data from BrandZ, Datamonitor and
Bloomberg)
Global Top 10
By value
Rank Brand Value ($m)
1 Google 100,039
2 Microsoft 76,249
3 Coca-Cola* 67,625
4 IBM 66,622
5 McDonalds 66,575
6 Apple 63,113
7 China Mobile 61,283
8 GE 59,793
9 Vodafone 53,727
10 Marlboro 49,460
*includes Diet Coke, Coke Light and Coke
Zero. Source: Millward Brown Optimor
(including data from BrandZ, Datamonitor
and Bloomberg)
Same-old, same-old?
Top 10 Risers
by brand value growth, (year-on-year)
Brand
Brand value
growth (%)
China Merchants Bank 168
Blackberry 100
Amazon 85
Wendy's 72
AT&T 67
Aldi 49
Auchan 48
Vodafone 45
Johnnie Walker 42
Kronenbourg 1664 41
Page 6
Old = New?
The Retro Brandwagon – Financial Times, May 2009
Andy Bond of Asda, comments: “At a time when people are having to
watch the pennies, many are reverting back to doing things like their
parents did…. we’re seeing the sales of brands like Kellogg’s, Bird’s
custard and Vimto rising faster than others, as people hark back to their
youth.”
“The brands that do best manage to balance evoking memories with
innovating”
Page 7
A few food industry basics!
Page 8
What is right investment %?
Unilever 2.4% (2005 data)
Danone 1.2% (est.)
Nestle 1.79% (est.)
• Ireland – small
• Breakthrough vs. Adoption?
• Activity ≠ Success!
• Approx. 30% activity in cheese
Everyone’s at it…… so
Everyone has to be at it!
Page 9
Know your customers!
0
20
40
60
80
100
Tesco Safway
(USA)
Carrefaur Aldi
% PL
PL quality – largely not an issue; better?
Page 10
Innovation
Product
Idea
Model
Comms
Page 11
Product
Innovation
Page 12
It tends to be a ‘Rocky Road’
OPTIMISM
PESSIMISMThe Dark Night of
the Innovator
Weeks or months Up to two years
ScepticalSceptical
EnthusiasmEnthusiasm
Beer &
Fireworks
Beer &
Fireworks
This is taking timeThis is taking time
Results aren’t
visible
Results aren’t
visible
Existing business
is suffering
Existing business
is suffering
Is it worth it?Is it worth it?Start to see
pay-offs
Start to see
pay-offs
Maybe not a bad ideaMaybe not a bad idea
It works!It works!
It pays!It pays!
Product
Page 13
With varying influence between Innovation and Operational teams
Innovation Operation
OperationInnovation
Innovation Operation
How the text books see it
More like reality
But what it needs to be
Product
Page 14
And the hurdle rates are very highProduct
Page 15
With particular challenges for FMCG
q Increasing/Decreasing the pace of Innovation
q In 2003 our NPD pipeline x 12
q In 2007 our pipeline x 76
q In 2009 our pipeline x 12
q Success of New Product Launches Falling
q Competitors & Retailers will copy – 6 weeks!
q Shelf Space Squeeze – 1 in 1 out
- US multiple 41,000 skus (+50% in 5 yrs)
- UK multiple +8% skus chasing +2% space
Product
Page 16
A new approach needed….
Investment banker invests in 10 start-ups
Invests €100k into each
Result at end Year 1
7 of the 10 go out of business
2 of the 10 break even
1 is spectacular and returns 1200%
Is this success or failure?
Product
Page 17
Success of course ….it is not about the quantity but it is about the numbers
q Fail fast …. Fail cheap
q Have a variety of innovation initiatives from the
more certain to the uncertain
q Evaluate them differently …… don’t use business
case thinking where uncertainty is high
q Innovation is not just about products but should
impact all functions…. is there a better way?
Product
Page 18
Idea
Innovation
Page 19
Existing products/brands can be
‘innovated’
Usage, positioning, focus
Idea
Page 20
Idea
Page 21
Page 22
Model
Innovation
Page 23
Model
• What’s your business model?
• Where can you add value?
• Where can you avoid ‘cost’?
Page 24
Innov. Prod. Ops. Sales Mktg Margin
R&D
?%€
Copy/licence
Produce/
Outsource
Distribute/
Agency
All Channels
DBM
AH
BH
%€
Cash/%
ROI
Model
Page 25
Comms
Innovation
Page 26
New Ways of Connecting
Comms
Page 27
Functional Emotional
Comms
Page 28
Comms
Page 29
Comms
Page 30
Innovation
Product
Idea
Model
Comms
Page 31
“Future is here today; it’s just not proportionately spread”
(yet!)
Page 32
Thanks!And remember, entrepreneurs (and innovators) don’t know
their limitations
Page 33
Innovation:Innovation:
Some Holistic ThoughtsSome Holistic Thoughts
Colin Gordon, CEO
Glanbia Consumer Foods Ireland
12th May 2009