How much of an added value are you providing to your product’s users by creating assorted products? Marketers tend to assume that the more ingredients are added to a product, the more selling value can be created. But is this really true?
So let’s have for instance a look at mayo. Some mayo is sold plain while some contain spices or even tuna. The idea behind adding additional ingredients to the plain mayo is that the client does not need to buy them separately. By the way, assorted products are found in many other categories as well, e.g., salad oils. But does this approach really create an added value to manufacturers, supermarkets, and users? Well, not in all cases. Because of hurdles like shelve space limitation; the more varieties we generate, the more space in shelves we need, and we all know that shelves’ places are extremely limited, therefore precious. Another hurdle is that manufacturers will face the challenge of additional complexity in the manufacturing process. Instead of selling assorted products, why not selling their ingredients separately? Think about sandwiches with different kinds of bread (X) and different kinds of fillings like cheese or ham (Y), by providing these Xs and Ys separately, we can provide our users with far more freedom to choose their favorite combinations.
So let’s think about 5 different loafs of bread and 5 different ingredients, sold separately, thus, 25 given options are possible. New combinations offer customers new opportunities in so many ways that are not possible to achieve when sold already assorted. This idea can be applied also in other categories e.g., beverages like water or milk (X), where an ingredient say vanilla or cinnamon flavor can be added.
But what are the hurdles preventing selling ingredients separately? Supermarkets often do not sell small portions to allow combinations to happen so that trade off costs are too high. So it is recommended to put the X and the Y within one concept under one brand umbrella. Co-branding of two strong brands may be an option. Supermarkets can support this combinatorial approach by offering discounts or vouchers for such combinations. So how can ideal pairs be found? Indications on X to refer on Y and vice versa can also be provided to bel labeled on separate ingredients. CRM programs of the supermarkets such as Cumulus and Supercard offer large data that can be analyzed.
Mirko Stanic is an expert in food innovation and has written a book about it. Download it on Amazon