Soaps clean, moisturizers moisturize and conditioners lubricate. When a team or company is primarily focused on benchmarking, it can be difficult to make time for what is truly innovative about formulations. More importantly, years before the current year's budget squeezes, most companies begin to cut back on competitive product testing and analysis as recurring costs that distract from innovation.
In a fast-moving marketplace, few would disagree that product performance benchmarking is critical to achieving and maintaining an industry-leading position. However, is this statement just lip service in the current environment? The blistering pace of market changes and tight launch schedules have been limiting the breadth of product benchmarking studies for some companies. Is this trend impacting the true value that these studies can provide?
Some organizations continue to benchmark regularly to ensure their products measure up against the competition. One company, for example, had developed a new line of molecules for hair conditioning from a 2-in-1 shampoo formulation. While these molecules exceeded the project targets for lubrication, benchmarking helped to identify challenges in delivering other customer expectations. Addressing benchmarking concerns led to finding the sweet spot in formulation space and facilitated the successful marketing of the technology.
Another company developing a technology for preserving hair color discovered that while efficacious, the technology turned out to be similar in performance to existing mass-market products. This finding allowed the company to refocus its development program on other potential chemistries. The benchmarking effort saved the costly scale-up and launch of a mediocre technology.
Formulators also have found ways to put benchmarking to good use. One consumer goods company developed a new class of skin care formulations that provided immediate visual benefits. However, benchmarking identified alternate, lower cost routes to the same benefit and led to the improvement in product price positioning and improved profit expectations.
As another example, formulators at different consumer goods company were able to use benchmarking data with their marketing department to guard against over-reaching claims language that would have resulted in industry challenges. This benchmarking study enabled them to focus internal resources on brand-differentiating measurements that supported even more impactful claims in the marketplace.
If a company is sincere about superior product performance, product benchmarking is a strategic imperative that will enable them to:
1. Set clear targets and action plans. Benchmark data provides measurable and comparable data to identify where a product's performance currently stands and to where it should be moving. Benchmarking ratios are instrumental for setting goals and action programs for new product development as well as helping to focus attention on the most controllable aspects of a product. Success and failure can be clearly analyzed and acted upon to adjust and improve performance.
2. Keep an eye on a product's performance over time. Benchmark ratios provide an objective standard with which to measure a product's performance. Regularly tracking the key measurements of a marketed product avoids the cumulative effects of “salami slicing” quality by forcing formulators to attend to the critical factors affecting the product's performance. How does a current product's performance measure up to new offerings?
3. Communicate the results. Benchmark ratios allows companies to differentiate their products in the marketplace and provide the solid claim support data to uphold advertising and promotional campaigns.
The true value proposition of benchmarking results is the analysis and action to improve best practice performance and rankings. What will your company do to rise above merely talking up good game of benchmarking?