Focus Your Food & Beverage Innovation on Your Brand’s Promise

June 7, 2021 | by David Lemley

In a recent client meeting where we were discussing potential new product opportunities, the CFO threw out a quote from Confucius: “The man who chases two rabbits catches neither.”

His words prompted me to think deeply about the intersection between brand strategy and innovation.

Some food and beverage brands manage to out-innovate their strategy, to launch products that deviate so far from the brand’s mission and promise that they a) don’t make any sense and b) confuse the consumer. (Think, for example, of a beloved luxury ice cream brand extending into probiotic dairy-free plant-based frozen treats. Two different rabbits.)

Others risk overlooking meaningful opportunities to develop a new product offering because it falls outside the known audience and their understood needs.

So what’s the right balance? It’s a timely question because we’ve predicted that the coming 12 months post-pandemic will be a boom time for innovation in natural food and beverage brands.

With this article and the next, we’ll try to answer the question, sharing our insights on when it’s best to chase just one rabbit and when it’s smart to pursue both.

Innovation Yields Opportunity

When we talk about innovation, we mean real research and development to yield new products, not just line extension with a new chocolate peanut butter flavor. True innovation requires that brand leaders are disciplined in two areas. First, they deeply understand their audience, both current and future, and how the brand meets needs that these consumers don’t yet know they have.

Second, they are committed to anchoring R&D in brand strategy, which means that they grasp what we call the “range of acceptable stretch.” (That means how far you can push your product line in a way that makes sense to your audience.)

Businesses are pressed for growth like never before. The chief growth officer (CGO) has surpassed the CMO on the corporate food chain and in this new organizational hierarchy, the CGO (not the CMO or COO) is responsible for marketing and innovation. Companies are bringing in a bunch of really smart people and task them with finding opportunities (we’re big fans of using Blue Ocean Strategy as a catalyst for new product development). If you’re not growing, you’re dying.

Sometimes they stumble on an idea that’s so outside their existing audience and promise that it would be problematic to implement under the current brand umbrella. (If this is you, stay tuned for our forthcoming article.)

Go Narrow, Go Deep, Be Relevant

Given all this activity, chances are good you’ll unearth a few ideas that do fit with your brand’s ethos and fall within that range of acceptable stretch. And those offer strong potential for ROI.

Generally, we guide our clients to focus their innovation around brand strategy and scenario planning that addresses their current and future buyers’ need states. Becoming a Beloved & Dominant Brand requires focus and an ownable point of view that resonates with critical audiences.

Throwing a bunch of quasi- (or not at all) related SKUs on the shelf dilutes the brand’s position, confuses your consumers, and opens you up the risk of losing fans, market share, and velocity. You’ll become more susceptible to competition and over-rely on your leading SKU to offset weaker products.

Instead, go narrow, go deep, and be relevant—for the win!

Being too narrow or niche-y is scary for most CMOs. Best practices tell us that broader is safer. With performance pressure from above, marketers tend to hedge their bets by offering a bunch of stuff instead of honing in on a lineup that’s strongly relevant to their audience. Call it FOMO — fear of missing opportunity: What if there’s an ingredient we didn’t think about or a technology we didn’t know about or an adjacent product we didn’t add?

Marketers assume that the goal is to be in the consumer’s consideration set; you have a 1 in 10 chance of being purchased, which is better than not being purchased at all. Even sophisticated marketers buy that theory, but we think it’s a fallacy. If you’re always the preference and never an alternative — the position of a Beloved & Dominant Brand — you’ll be purchased every time. Brands that build stark-raving fandoms do not pursue general audiences. They have earned their loyalists through the discipline of going narrow, becoming preferred, and evangelized by their tribe.

Plenty of brands do narrow and deep exceptionally well, like these:

Highkey understands the principle of solving the same problem in so many delicious ways for the same narrow group. The team came to us for help rationalizing a massive list of potential products into a logical, manageable range upon which to grow the brand. Together, we repositioned Highkey from keto dudes to on-the-go moms looking for great-tasting snacks that wouldn’t wreck their diets. It’s a focused audience, a tight use case, and yet a wide range of products.

Anser is a still-new brand of supplements and wellness products aimed at women of color, who’ve historically been overlooked by the industry. We helped them launch with an aim to make a self-care routine for multiethnic women, and now they’re line extending like crazy with a whole bunch of new products for the same focused need state.

Reser’s Fine Foods is a family-owned Pacific Northwest brand that creates prepared foods for the grocery deli case. They’re super focused on a consumer segment with a common need: people attending a potluck or barbecue who want something reliably delicious to share, and families who need something good and easy for dinner. Within that focus, they have wide latitude to innovate; their product offering ranges from salads and dips to heat-and-eat side dishes.

Given the fire hose of innovation at many companies, you’ll likely pump out lots of great options, and you may want to pursue multiple opportunities at the same time. The problem is that instead of doing one thing well and staking out mindshare with key groups of humans, you risk spreading thinly across multiple categories, solving groups of unrelated problems for different audiences.

Brand strategy is the discipline of narrowly defining who you are, what your contribution will be, and then making a series of decisions to keep your promises in a way that other brands can’t or won’t. And that strategy should underpin the choices you make about what to add to your portfolio.

In other words, chase one rabbit and you’ll catch him.

But … what if that second rabbit is simply too appealing to ignore? What if your thorough innovation process spots an opportunity — a new product aligned with an unmet need among a different audience — that has enormous bottom-line potential?

We’ll dive into that in our next article.

In the meantime, we’re always happy to talk innovation, so give us a ring.