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Speed Up Your Profit Expansion by Stealthily Testing Every Promising Idea Simultaneously

Jan 27, 2008
Leaders are often proud of their ability to make tough decisions and drive forward despite difficulties. However, that courage is usually a dangerous attribute when it comes to making test of new ways to expand volume by 20 times.

Why? Many great improvements emerge from trial-and-error experimentation. The priorities that any leader establishes for expanding to twenty times volume will, however, almost always turn out to be inferior to the priorities that emerge from simply picking the best performing alternative after running lots of experiments.

I am reminded of that observation by the early days of Grey Poupon mustard's rapid expansion in the United States. Excellent brand thinkers had developed a set of assumptions then about the brand that they ruled could not be violated. Those assumptions included some of the following:

-No package could be priced at retail over $1.00.

-The package had to be made of clear glass with painted letters and images on it.

-Only one flavor, the original version, could be offered.

-The formulation had to include white wine.

-The package's appearance had to evoke the product's French origins as a Dijon mustard.

Rapid growth followed when these assumptions were loosened to allow single serving packets that were sold to airline caterers for use with onboard sandwiches. People discovered that they liked Grey Poupon and began looking for it in their supermarkets.

Today, the brand sells more than 200 times its volume than when the brand assumptions were made. If we look at how the brand has evolved, a trip to my refrigerator shows that:

-popular size continues to be the "new" 8 ounce glass jar introduced in the early 1970s. But you can also buy the mustard in 10 ounce squeeze bottles and larger-size glass jars.

-The retail price for 8 to 10 ounces continues to be less than $1.00 a package if we take inflation increases out of the current price. But the larger-size glass jars sell for much more than that amount in constant dollars. Clearly, the convenience of not running out of the mustard as often and a reduced price per serving made the package's price point less important to purchasers and consumers.

-The squeeze bottles are made out of flexible plastic with plastic lids. The 8 ounce jars still have metal lids. The lettering is now printed on plastic sheets that are glued to the packages rather than being painted onto the glass jars and plastic bottles.

-You can buy the original Dijon flavor, a "Deli" mustard that features horseradish, and a "Country Dijon" version that is milder.

-All versions include white wine.

-The current packages all contain a blue and white emblem on their fronts that indicate that these products are recommended on the South Beach Diet in all three phases.

A trip beyond my refrigerator to the Grey Poupon Web site tells us that Grey Poupon also comes in the following branded flavors: honey (Dijon mustard with honey added) and spicy brown (with an "extra-spicy burst of flavor").

While I can only speculate about what opportunities were missed in the early 1970s, one of the lessons this examination provides is that people want milder, but good tasting, spicy mustards in more convenient containers. Testing with such other flavor formulations in the 1970s might have helped launch this brand onto a higher growth trajectory. By becoming an "everyday" mustard sooner, the switch into squeeze bottles and larger glass containers could also have come sooner.

In retrospect, we can see that the brand thinkers were making a classic leadership mistake in the beginning: The brand thinkers were projecting their own perceptions of Grey Poupon onto all other potential consumers. Since the product was only selling $100,000 a year at the time, most people didn't know what Grey Poupon mustard was, what it tasted like, what it should cost, how you should use it, or what benefits it could bring them.

Had the brand thinkers instead looked at the opportunity to sell more mustard (of any kind), they might have chosen to develop a new brand name, a different formulation, and a lower price point. Had this more fundamental testing occurred, we believe that a larger and more profitable mustard brand would probably have emerged. But that inexpensive testing was precluded by the marketing assumptions, and the testing didn't occur when the market opportunity was hot to spice up growth (puns intended).

Here are questions designed to summarize what you learned from examining ways to remove obstacles to expanded consumption or usage of your offerings:

-What obstacles are better removed than avoided?

-What actions can eliminate the most substantial obstacles?

-What combinations of actions are most likely to be effective in eliminating obstacles?

-How do the costs of best avoiding obstacles compare to optimal methods of eliminating those obstacles?

-What are the costs and risks of doing more obstacle-removal testing rather than less?

-How can you run the most tests for obstacle removing in stealth mode on a time and effort budget you can afford?
About the Author
Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantage. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at

http://www.2000percentsolution.com .
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