In this post I want to discuss about a slightly old but relevant case of Knorr's mobile-based new product development project in Japan. Knorr Foods, a subsidiary of Ajinomoto Inc. Japan, involved younger female consumers in development of a new Soup Pasta by creating a mobile campaign site where discussion threads served as input for the idea generation and screening.
In 2006, the Japanese soup market was valued at $1.43 million. Ajinomoto had led the Japanese soup market since 1964, when it began to sell the Knorr brand through an alliance with U.S.-based Best Foods (acquired by Unilever in 2000). Its brand mix included three main variants: Knorr Cup Soup (for breakfast); Knorr Soup Pasta and Knorr Soup Harusame (popular among young women for lunch); and Knorr Tamago Soup (a mainstay soup, packed with ingredients that go well with rice). With the Knorr brand, Ajinomoto held 26.5% and 42% of the instant soup and total soup markets, respectively.
In 2007, Knorr was in the midst of developing a new Soup Pasta to target the primary gourmets of noodle cuisine: younger, female consumers. Bringing a new product to market is not an easy task, but in this case, the hardest question was how to develop a Soup Pasta that fit the target segment's taste preferences. To generate and commercialize the product successfully, the company needed frank and honest opinions from young, female consumers during the idea generation, idea screening, concept development, product design, and detail engineering phases. To this end, Knorr decided to tie its new product development project to the Tokyo Girls Collection (TGC).
The TGC is a twice-annual celebration of all things cute, organized by Girlswalker.com magazine to showcase the season's fashionable streetwear produced by domestic brands. Unlike typical "invitation-only" fashion events, this show is open to anyone who pays the entry fee. The clothes are sold at in-venue stores and the fashion show uses only amateur models chosen from trendsetting girls' magazines. The fashion event includes entertaining attractions such as live performances by renowned artists, a charity auction, the final stage selection and presentation of the TGC Contest.
In September 2007, Knorr's new product development project was announced at the TGC venue, with star TGC models assigned as official new Soup Pasta development project members. Knorr set up a campaign booth, where the TGC project members explained the product development launch. At the same time, surveys asked the TGC participants what tastes they wanted in Knorr's next Soup Pasta. Knorr launched a mobile site on the mobile Girlwalker.com site, where TGC project members described the product development process in their blogs. On this blog, other mobile users freely entered comments and opinions, creating successful discussion threads that revealed the vast majority of customers' need for the new Soup Pasta. The bloggers' comments thus effectively replaced traditional idea generation through qualitative research, which often relies on one-on-one interviews and focus group discussions. Also, this blogging provided young consumers with real-time information, as well as entertaining reasons to talk. Knorr therefore expected project information to be spread among the blog participants' friends, peers, and family.
The TGC model project members participated fully in the product development process, from a visit to Knorr's factory to package design, from idea generation to taste testing. In March 2008, Knorr finally developed a new Soup Pasta called "Tarako Cream" (creamy cod roe), which embodies the key attributes identified in the new product development project. As with the initial project announcement, Knorr used the TGC to present samples of Tarako Cream and offered the new Soup Pasta to young girls from catering trailers located at the venue. In April 2008, Knorr started nationwide sales of Tarako Cream, mainly at major convenience stores. The product was received enthusiastically by young female consumers in their teens and 20s, and as a result, sales of Knorr Soup Pasta increased by 50% compared with the previous year.
Knorr's mobile blogging enabled the company to minimize the risk associated with new product development in two ways. It immediately reduced the cost of idea generation. Often, a search for important ideas resembles the quest for a needle in a haystack. Firms must make substantial investments to generate many ideas, just to find one worthy of development. The ubiquitous communication device also enabled more timely and speedy comment entries in blogs, which compressed the development time.
One has to ask that why did the company use mobile internet to reach the consumers when it could have opted for normal internet websites. Japan represents a country with one of the highest levels of 3G penetration. A staggering 90 million 3G handsets are currently in circulation, and more than 70% of the 127 million Japanese population has subscribed to the mobile Internet. Since NTT DoCoMo's i-mode launched in early 1999, the mobile Internet in Japan has become increasingly fast, sophisticated, technically stable, and easy to use. By pressing one dedicated button on their phones, users can instantaneously go online and therefore since 2006, more people have been accessing the Web by mobile device rather than by PC.
India has also started 3G services though BSNL and MTNL and the country is likely to see national rollout of 3G services by other service providers by end of 2010. While internet is making rapid proliferation in India, 3G on mobile phones presents an opportunity for marketers to exploit this new mode for different marketing related objectives. In doing so, the marketers need to look beyond using mobile for sending text-based mobile ads and shift to mobile-based promotional campaigns, in which mobile communication is part of a more holistic marketing strategy.
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