It is no secret that relevant innovation is crucial to success in the home and personal care and food and beverage industries. According to a study conducted by AMR Research in 2008 and cited by Accenture, the ratio of ideas generated to actual launches in home and personal care was 21:1. That ratio was 13:1 in the food/ beverage/alcohol segment. Furthermore, only 50% of product concepts moved from development to launch; of those, just two thirds generated the anticipated revenues. Among the reasons for failure, AMR Research found that 27% were impacted by not meeting consumer needs, while 23% suffered from a lack of clear differentiation.
What worked? The AMR Research study found that successful consumer product companies had three key traits: they launched 25 times more products than their bottom quartile counterparts, generated 20% more revenue from their new product introductions and had a speed to market that was nearly five times faster. In order to support new introductions, companies are looking for growing amounts of innovation from within and without their organizations.
To support growing innovation needs, AMR identified a rapidly increasing trend of consumer product companies collaborating with external partners.