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Report

Teaser, summary, work performed and final results

Periodic Reporting for period 1 - Weekend Shop (Reinventing FMCG Market Research with Real-Life Product Testing)

Teaser

Summary

In Austria, grocery manufacturers launch 400 new grocery items (including re-branding) and 10,000 beverages each year. Each of the manufacturers invests a great deal of passion, innovative spirit, commitment, know-how and money into the respective product in order to subsequently list it in retail stores.
Over 90% of the newly listed FMCG (fast moving consumer goods) disappear from the market within six months. This is not because of the product itself but because of the lack consumer awareness at the point of sale (POS). In other words, most products lack the correct advertising for the exact target audience.
Retailers like Merkur and Interspar have almost 40,000 items in their product range. Among these, for instance are 76 different types of cereals.
Consumers are often overwhelmed with the choices, and they end up buying the same items as usual 83% of the time.
For Europe, this is estimated to be 30,000 new products a year of which 90% fail and consumers end up with only 3,000 new products that stay on the shelves.
In terms of losses for manufacturers, using the confectionary manufacturer Manner as an example, this means â‚¬250,000 investment per product launch multiplied by 27,000 failures is â‚¬6.7 billion yearly. This is not much for giant manufacturers but prohibitive for smaller specialty producers such as domestic diary producers (Berglandmilch) or pastry shops (Salzburg Patisserie).
It is true that our core business at Weekend Magazin Wien GmbH is a printed lifestyle magazine. We understand that eventually, the consumers make the decisions, and we want to help brands understand it. Therefore, we constantly look for ways to identify and answer our customersâ€™ needs. This is how the Weekend Shop concept was born. Our media business allowed us to fund the creation of the first Weekend Shop and to make it a success. However, once the business becomes self-sustainable, we intend to spin off the Weekend Shop as a different company. Just as Weekend Magazin Wien GmbH, it will be owned by our family members but operate independently from the other businesses.

Work performed

We have drafted a Business Plan that includes the results from studying our International Market Replication Strategy, Technological Roadmap, Business and Pricing Model Assessment, Risk Analysis and IP Study.
We are convinced that our concept can be replicated and scaled worldwide.
Based on the research we have done, the next step will be an expansion within the DACH region as this corresponds to organizational and decision-making structures of most international companies. Moreover, customers in these countries tend to be more open to innovation; they are well informed and open to share their sincere opinion. Further on, we plan to be present in Northern and Southern Europe and within CEE.
In view of the findings obtained from our survey, the original plan to open two more locations in Austria will be abandoned for the time being. Instead, internationalization within the DACH region shall be pushed and accelerated. Next steps will be stores in Germany (Berlin, Munich, Hamburg) and Switzerland (Zurich, Bern) starting in 2020.
Besides opening new stores in different cities, we war planning to offer product tests for new retail technologies such as Augmented Reality or Motion Analysis.
Based on the development and integration of technologies we are facing two concrete business cases: a) Implementation of Real-Life market research in Weekend Supermarkets worldwide:
Provision of relevant data referring to the local retail market in various countries/regions. b) Application of consolidated technologies in any relevant field of business.
Apart from all the conventional online and traditional marketing activities to promote the positive impact of the EC funding and our product Weekend Shop, we will publish the information in our Weekend Magazin and the publications of our related businesses. We will also host breakfast and networking events on regular basis to create a buzz on all our current or new locations.

Final results

The Weekend Shop real-life product method added value over state-of-the-art market research includes:
â€¢ Real-Life Feedback: Weekend Shops are the only way of collecting information based on actual consumers who shop products in the usual grocery format environment and then provide their honest opinion.
â€¢ Representative Sample: The members of a Weekend Shop are representative of the population in terms of gender, age group, household income, region, relationship status, number of children, type of household, education and type of job. This allows for strong conclusions for the entire market.
â€¢ Qualified Respondents: members of the Weekend Shop know they pay with their opinion, and they want to have exclusive access to new products. Many of them sign up out of curiosity and feel that their opinion will make a difference rather than save money.
â€¢ Exposure of New Products: Even though the Weekend Store members are highly motivated, if going to a conventional grocery store, they might not select new products since it may take them longer to figure out whatâ€™s new.
â€¢ Local Brands: Premium placement in retail stores is too expensive for smaller local brands, which excludes them from long term success. With Weekend Shop, those smaller brands have an affordable alternative to get the market intelligence they need to have a chance to succeed.
The EU promotes science to become the core of food production. This is because of the growing world population, higher quality demands and ever-more stringent conditions. The EU supports new techniques and access to technology to help manufacturers and farmers use resources more efficiently. In fact, innovation is vital for EU agriculture to remain competitive and sustainable and to produce more with less . However, 90% of innovative products will never make it to consumersâ€™ home. Partnering with innovative store concepts like Weekend Shop could maximize the success to bring innovative food from farm to table.
A dense European coverage of Weekend Shops would empower consumers to decide what ends up on their shelves. Trends such as organic and healthy food would be discovered much faster than they are otherwise revealed. A critical mass of feedback could even lead to consumer-initiated product innovations. Also, this business model allows people to pay with their time/feedback rather than with money. This leads to more fairness and understanding that time is the ultimate resource, not money.