A study of 480 product launches by North American consumer goods makers highlights the ability of certain marketing tactics to help spur revenue growth. The findings suggest that manufacturers should take a harder look at repositioning products toward new consumer segments, uses, and occasions—particularly at times when truly innovative, or breakthrough, products seem few and far between.
To understand the sources of revenue growth in the sector, we reviewed the growth rates of 290 categories of consumer products (such as bottled water, soap, and yogurt) over a five-year period.1 Although the categories grew, on average, by 2.3 percent a year, 16 of them increased some five times faster (Exhibit 1). We looked to see if structural differences among these categories—their size, for example, or the level of competitive intensity within them—might explain their more rapid growth and found none.2
Next, we analyzed the 480 product launches associated with the high-growth categories, examining the marketing tactics that the companies employed for each launch (Exhibit 2) and determining whether the product represented a breakthrough innovation. Then, using multivariate regression analysis, we measured the incremental contribution of...