Relaunching: A golden opportunity for you?
Relaunching is a great opportunity to galvanise a jaded team, raise the profile of your work within your company and inject new energy into a product. Staffing and infrastructure issues can be resolved during the process of change, but these are no more than bonuses. The driving force behind a relaunch is the need to improve the market position of your product, either by turnover, profitability or growth.
Relaunching can be risky and expensive, especially if you choose to alter the course when times are still good and in growth, and you’re making a pre-emptive strike. Deciding to relaunch during the mature phase of a product’s lifecycle is common for FMCGs (Fast Moving Consumer Goods), with minor tweaks giving the plateauing curve of growth a sufficient kick to raise it above the competition. More often than not, relaunching will be forced upon you because you’ve inherited a dying product, with a growing gap emerging between its performance and that of the market and/or rivals. What needs to be done can be defined by analysing that gap. In short, you have to audit your product to establish where its future lies.
Case Study: Heat Magazine
In 1998 publishers Emap thought there might be a gap for a men’s weekly devoted to entertainment. The company spent a fortune advertising the launch, and hoped to sell 100,000 copies a week. Despite a huge marketing campaign the title was a flop, and within months its future was in doubt. There was no market in that gap, but Emap weren’t prepared to give up so easily, and came up with a cunning plan of relaunching the magazine with the same look, the same name, a similar team, just different content and aimed at women. You now know the magazine as Heat, and today it sells some 500,000 copies a week. Heat was a classic case of relaunching a successful failure, a product with plenty of potential but aimed at the wrong market. The launch provided valuable market research and a framework for re-focusing the product towards a different market. Heat remained an entertainment magazine, but for women, gradually focusing on gossip and redefining the market.
The obvious place to start when auditing your portfolio is with market share and market growth. If you’re sitting on a cash cow (as defined by Bruce Henderson of the Boston Consulting Group (BCG) in the 1970s), with high market share in a mature market, you won’t be wanting to invest much, just milk the profits.
In that situation you’ll do nothing more than make small improvements to maintain your position, while searching for ways to keep costs low, passing the profits on to invest in what Henderson described as star products that are rising fast in a growing market, but which are expensive to fuel. The risk, of course, is that you forget to feed the cash cow (i.e. relaunch), which runs dry while it could still be doing very nicely, thank you.
The challenge with marketing theory like the Boston Consulting Group matrix (see Fig.6) is that it assumes you have a clear picture of the market size, your position and your competitors. In our experience this is rarely the case. However, senior management love their numbers and you will need to collate any marketing statistics you can to build as compelling a case as possible for a relaunch.
At the end of the day, the decision makers ask themselves: “Do I really believe this?” Often it’s the telling anecdote from a key customer or the sincerity of the product manager that convinces the senior executives in your business, rather than market statistics and theory.