- Thanks to real-time data insights that Alibaba offers product companies, Mars was able to develop a spicy Snickers bar product that was an instant hit — and in half the time new product development normally takes. The data insights that allowed them to create this coveted combination allowed Mars’ China division to meet its goal of having new products account for more than 10% of revenue, according to Bloomberg.
- Alibaba, the biggest e-commerce and payment platform in China with 600 million monthly users, tracks consumer behavior on- and offline. Then the company's market research arm, Tmall Innovation Center, crunches the data and shows companies what consumers want but can't find.
- Unilever’s director of data and digital development Susan Ren said Alibaba gives them a real environment to test new products. "Because consumers have no idea that they are taking part in a survey or study, their reactions and purchasing decisions are real. It makes the feedback real, which is a huge advantage in an industry where product innovation is essential, but costly and risky," she said.
Manufacturers want to know what their consumers crave. From Spicy Snickers to Cherry Sprite, large CPG companies have learned that keeping real-time tabs on customer choice is the ideal method to understand exactly what the customer is looking for.
This research from Alibaba allowed Mars to know that the same people who buy chocolate using the payment platform also like spicy snacks. That sparked the creation of the Spicy Snickers candy bar, which uses Sichuan peppercorn, a popular spice in China. The success of this new creation may inspire companies to lean more on data to develop new products.
Although American online privacy laws prevent companies from conducting marketing focus groups on unsuspecting consumers, there are still plenty of methods through which manufacturers can collect data with consent. Manufacturers use data collected from retail sales and social media, but one of the more successful ways to pursue product development is by asking for it through contests that allow consumers to vote on their favorite flavor varieties that they can later buy in stores.
From PepsiCo's Lays potato chips asking for votes on favorite varieties to Mondelez's Oreos flavor contest on social media, inviting consumers to participate in product development lets fans engage with a brand, which makes them feel like they have power over the products they will eventually buy. Plus, if a consumer voted for a flavor variety and it wins, that person may be more likely to buy it in the future. Parent companies like PepsiCo and Mondelez have a wide stable of brands, so they could connect data on flavor preferences to other food product altogether — think a Thai sweet chili variation of Sabra hummus, or a blueberry pie flavored Belvita biscuit.
Other methods of collecting consumer insight include utilizing proprietary technologies that allow consumers to "create" their own flavor combinations with already existing components. Yet other companies like Amazon have even greater advantages with their access to an enormous database of customers who regularly shop online. By tracking their habits, the giant online retailer is not only able to suggest products more accurately on their online homepage, but they can source from that data on the back end when developing products for the Whole Foods 365 brand.
By creating products based on customers' preferences, CPG companies are not only able to streamline the innovation process but they are also able to sell more products. That means less of its products sitting unsold on shelves because a manufacturer pushed the boundary too far on something new that consumers don't want.
But despite how efficient and insightful data mining may be, customers may not be completely thrilled to have their habits tracked so closely. Digital privacy is a growing trend as consumers learn how companies are tracking their clicks and storing their online purchase histories. While there is still plenty of information for companies to choose from, things like Europe’s recently-passed General Data Protection Regulation legislation indicate that perhaps the tide is turning and no matter how many great products are generated by using real-time consumer insights, there is a limit to how much the consumer is willing to share.