Historically, marketing plans are set for the entire year using marketing data available in multiple ecosystems, both internally and externally. Customer behaviors change so frequently that manufacturers and retailers need a way to identify the best data sources and use them to make required Agile changes to plans in support of the customer voice, all done in a timely and cost-efficient manner.

Manufacturers and retailers recognize the massive benefits that Direct to Consumer (D2C) models support by providing more control over pricing and promotions, allowing them to influence margins and set prices to align with their view of the value of their products. By the end of 2024, the U.S. D2C channel is expected to reach $212.90 billion, with a 12% annual growth rate anticipated in e-commerce from 2020 – 2025¹, a powerful indicator of consumer behavior.

This growth has given shoppers countless options to select the perfect product from multiple competing brands. To try and meet that demand companies introduce nearly 30,000 products every year. Harvard Business School research found that only 5% of those new product launches each year succeed².

Manufacturers and retailers are faced with a new challenge: Is it worth it to be the first mover, or should we wait? The answer varies by product, industry, and even geography, but real-time market data is a critical tool to leverage in refining their product development efforts to successfully capture the market.

Should you Act as First Mover? What does the Data Tell You?

Today, speed to market can be the difference between domination and irrelevancy. We have recently seen product development launches occur in as little as 2 months from ideation, compared to 1+ years for the same development in the early 2000s due to the advancement of technology and globalization.

Over the past few decades, first mover advantages have become especially pronounced, as being the first typically enables a company to establish strong brand recognition and customer loyalty before competitors enter the arena. Other advantages include additional time to perfect products or services, as well as setting the market price for new items.

We have seen companies achieve the following benefits as the first mover:

• Brand Name Recognition is a major factor in a consumer’s decision to purchase a product. 59% of shoppers prefer to buy new products from brands familiar to them³.
• Economies of scale allow for a longer learning curve, frequently enabling the company to establish a more cost-efficient means of producing or delivering a product before it competes with other businesses.
• Switching cost for the consumer reaches beyond the financial impact to include procedural costs, losses stemming from evaluating potential alternative offerings, set-up costs, learning/training fees, rational, and costs; the losses from ending long-term business relationships, as well as giving up loyalty perks and incentives for long-term customers. This dynamic raises the bar for competitors to provide a strong enough value proposition to entice the customer to move to a different brand or product⁴.

However, there are potential drawbacks to the first mover advantage. The first mover may invest heavily in persuading consumers to try a new product. Later entrants would benefit from these informed buyers and not need to spend as much on educating consumers⁵. Due to the limited market research available, if the launch is unsuccessful, competitors can take advantage of using key findings to improve on the first mover’s product and take advantage of them and become the market leader⁶.

Real-time market data is a critical tool to capture first mover advantage, sometimes pinpointing product opportunities with little to no competition and relatively high profit margins. By carefully examining unmet or overlooked shopper needs, manufacturers can create valuable points of uniqueness against competitors, create leadership, and spot untapped white space.

The Value of Real-Time Marketing Data Can Validate Risk & Reward

Proctor & Gamble provides a memorable example of a marketing plan that was validated by real-time marketing data. In 2010, they confronted an image issue impacting their bottom line. The company’s Old Spice brand was not relevant or attractive to a younger demographic, and was seen as a “product for grandpas.”

In the past, Old Spice had a targeted audience of 40-60-year-olds. However, with the emergence of social media platforms, the market trend identified an opportunity to recruit younger consumers, 18-34 year-olds.

The new campaign was titled “The Man Your Man Could Smell Like.” P&G arrived at this opportunity with the following data insights:

• At the time, YouTube had nearly 100k unique monthly visitors, with an average of 1 hour and 12 minutes spent on the website⁷.
• 50% of YouTube site traffic users were 20 years old or younger.
• 60% of all male toiletry products were purchased by women (suggesting they should use an attractive male spokesman).

The advertisement launched online in early February 2010 and in 3 days, racked up 20 million views. After a month, Old Spice had become the #1 all-time viewed brand on YouTube. According to P&G, the campaign produced the following results:

• 2700% increase in Twitter followers
• 800% increase in Facebook fan interaction
• 300% increase in website traffic

P&G’s initial sales goal for the campaign was a 15% lift. But by May 2010, sales had increased 60% from the previous year, and by July, that number was 125%, an all-time high for the brand. Shortly after the campaign, they became the top brand in the men’s body wash category⁸.