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Does ‘Top 2 box’ restrict innovation?

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The more I study new product innovation, the more I understand how old business models restrict innovation. For example, the February 12, 2011, issue of the Wall Street Journal contained an editorial opinion article entitled “FCC vs. Innovation.” In this article, Holman Jenkins Jr. starts the article with a question “Are TV broadcasters the enemies of digital progress.” He then goes on to explain that demand for the mobile Web is growing like crazy, but much of America’s wireless spectrum is tied up to deliver TV to a shrinking audience of rabbit-ear viewers.

Flawed Consumer Research

The WSJ article made me think about current business models followed in the food industry that may be restricting new product innovation. The first thing that came to mind was the love affair between marketers and the “Top 2 box” consumer research results. If a company is truly developing innovative new products, then the consumers are looking at and tasting a product they have never seen before during a consumer research test. The end result may be that the consumers poorly understood the product during consumer research. I argue that the “Top 2” consumer research box is not an accurate measurement of a new product’s future success. I dare anyone to argue otherwise. If the new product is truly innovative, then why compare it to a similar old product. What could you possibly learn?

New Innovation Product Example

I learned the downside of this old marketing model while I developed an innovative new product called “Popcorn Chicken” at KFC. Original Popcorn Chicken was actually marinated dark meat strips vs. the ‘white meat ‘nuggets’ consumers are familiar with today. At that time, KFC consumers had never seen anything like it, and there was nothing to compare it to for market research. As a result, the true measure of consumer acceptance was actual store sales. So KFC took the risk, skipped consumer research, and placed it directly into an Orlando and Houston store test. And WOW, sales hit the roof almost immediately! We had to arrange separate overnight truckloads of marinated Popcorn Chicken meat to each market test store. Once KFC rolled it out nationally, sales hit 63 percent in one Chicago store.

Marketing Misunderstood the Innovation Category

However, the story doesn’t end there. Once the innovative new product was a sales success, Marketing continued to misunderstand its role. For at least a year Marketing envisioned this innovative new product as a “center-of-the-plate” chicken product. Once again, an old product paradigm prevented Marketing from understanding the reason consumers were buying it – as a SNACK item that generated extra sales in the mid-afternoon. In fact, it could be said that KFC’s Popcorn Chicken was the original QSR snack product.

Synchronization of R&D and Marketing Lesson

Another business lesson that could be learned from this success is that Marketing and R&D need to be on the same page when developing innovative new product. A QSR chain could spend thousands of dollars developing innovative new products, only to be killed at the pass if Marketing doesn’t understand the vision.

I will discuss how to develop a synchronized Marketing and R&D process in future blogs.

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