3 mistakes and 3 solutions

In 2005 some 156,000 new products were launched in the United States and 75% of them failed within 3 months. In that same year 21,000 brands were launched worldwide with 52% of them failing within 3 months.

Not only is this typical of most western countries, research suggests it is consistent from year to year. More than 70% of products and 50% of new brands fail each and every year.

Why is this so?

Clearly there are benefits in knowing why this is the case and why businesses think they will not be one of the failures. The cost of failure is high and the gains from success can be substantial.

I would argue there are many reasons for this recurring result, but no reason is greater than – the failure of products, services and brands to directly address a customer need or want, due largely to poor understanding of customer needs and wants.

The most common drivers of new products and services are:

  • Intuition
  • Logic
  • Research

Intuition is notoriously unreliable. Intuition has lead business to invest significantly in extrinsic incentives when science has demonstrated time and again that intrinsic incentives is so much more powerful in influencing behaviour, and extrinsic incentives can even be counterproductive. Science has shown that business is wrong in this regard.

Logic is of course not logic at all given that philosophical principles required to arrive at a logical conclusion. What we call logic is more often than not common sense – and common sense is grossly overrated, as it assumes we are rational, when we are not. If we behaved according to common sense we would travel just as far to save $50 on a $200,000 car as we would to save $50 on a $200 shirt – and research shows consistently that we will not. Why not – rationally $50 is $50.

Market research while often valuable also has its limitations. The facts are:

  • People do not know what they want (so why ask them).
  • Most of our drivers are unconscious so cannot be tapped into by survey.
  • Much of what we say in research is open to interpretation.

People know what their problems are, but as Steve Jobs noted – people cannot imagine what they cannot imagine. People know often know what they do not want but they struggle to envisage the solution and therefore what they do want.

A 60 year old Perth business man who tells you he purchased his $450,000 Ferrari because he loves quality engineering and travelling at speed, when he clearly know nothing about engineering and cannot travel at speed given the speed limits – is clearly not in touch with the ego that drove him to make the purchase.

What does it mean when in research people claim to want:

  • Quality?
  • Service?
  • Finish?

Time and again in research these types of words arise from research, but when pressed people have no idea what these terms mean. They cannot define quality, service or finish.

So where does this leave us?

I would argue that this analysis highlights the importance of research insights and scientific research undertaken in institutes and academic environments. This research perhaps involving MRI (and similar technology) and certainly involving strict experimental conditions provide far better ‘consumer insights’ and a superior understanding of:

  • Conscious and unconscious motivators and their relative importance
  • How knowledge and other stimuli changes needs and wants
  • How emotions decode brands and marketing messages

Fortunately there is a great deal of this data readily available.

Unfortunately few businesses are using it effectively.


  1. Intuition and logic based decisions produce poor outcomes
  2. People do not know what they need or want
  3. Market research should be supplemented with ‘consumer insights’

This issue will be discussed in more detail on THE D. JOHN CARLSON NETWORK – www.djohncarlsonnetwork.com

D. John Carlson is a behavioural scientist, strategic planner and lateral thinker focusing on branding, marketing and communication. Visit his blog – www.djohncarlsonesq.com

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