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    Harsh Mariwala talks product failure, importance of going to marketplace; shares success story behind Saffola oats

    Synopsis

    The Marico chairman says product failures pose some threat to smaller rivals.

    The Marico boss spoke candidly about product failures.
    Good ideas often fall flat in the marketplace. “Market research can only get you so far when it comes to launching a new product. You have to go to the marketplace to see whether what you are offering is working in the real world,” said Harsh Mariwala, Chairman, Marico Limited, at an event in Mumbai. A product might have all the right ingredients, but the cost of innovation is often failure.

    Big businesses might be able to stomach the loss. The death of a new product, however, could pose an existential threat to smaller rivals. Good businessmen, Mariwala reckons, have the necessary nous to shape consumer behaviour without burning their fingers by investing in half-baked ideas.

    “Whether it is the name, formulation, pricing, or packaging, every aspect of the merchandising plays a role in the eventual success or failure of the product. What happens in the prototype phase is that instead of going to the market research, you are testing your hypothesis among a group of people. For that, you should be willing to change things in order to innovate,” he said.

    Even established companies like Marico are not immune to the odd miscalculation. “Around five years back, we thought that there would be demand for baked snacks. All the snacks in the market at that time were fried. I, personally, was backing that product internally,” recounts Mariwala. The top management thought it wise to leverage the Saffola brand’s appeal with health-conscious consumers for the pilot project.

    “The key learning for us was that in the marketplace, you have to give consumers what they want", said Mariwala.
    “The key learning for us was that in the marketplace, you have to give consumers what they want", said Mariwala.

    “We have Saffola, which is good for the heart. So we thought, why not offer a baked snack under the Saffola brand? We went ahead and launched it in Bombay,” he said. Prototypes are rarely backed by advertising campaigns, and are hence reliant on positive feedback from consumers. Despite the brand’s street cred with “health-food” eaters, sales figures were anaemic.

    “The product didn’t do well because in our minds, Saffola was associated with health. Hence we gave more emphasis to the health part and not so much about the taste. It was a very healthy snack but perhaps not that tasty. Consumers in that segment want something tasty to munch on,” Mariwala conceded. Not one to be dissuaded by this failure, he took aim at another segment that was underserved in terms of options.

    “We saw an opportunity in the breakfast cereal business around three years back. Indians like a savoury breakfast instead of a sweet breakfast. So if you look at oats, people mix it with milk, and add a little sugar and perhaps, nuts. We thought: can we offer savoury oats that do not compromise on taste?” Market research was conducted, and the taste bud of the average Indian, mapped.

    “Some people like spicy food, others less so. So for each taste palate, we had different formulations for our oats. And we are talking about an extremely clear cut marketplace. We’ve been able to take on the likes of Kellogg’s and Quaker and because of our innovation; our market share went up even though we didn’t have a presence until then. We are not the market leader by any means, but we have established a niche,” Mariwala said.

    “The key learning for us was that in the marketplace, you have to give consumers what they want.”

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