Plan for Multifunction Marketability

The NPD Group, whose ability to anticipate retailing trends is respected, predicts significant growth in BB Creams. The “BB” stands for “blemish balm.” Although only about 2% of beauty shoppers are purchasing this cosmetics category currently, about 40% of beauty shoppers say, when asked, that they’d consider buying a BB Cream in the future, and 77% of past purchasers say they plan to buy a BB Cream again.
     Digging into the data, The NPD Group concludes that an important component in the success of this product category will be multifunctionality. As you’d expect, the single most important expectation of consumers is that a BB Cream provides natural-looking coverage of skin blemishes. But 47% say they expect a BB Cream to moisturize the skin, and 42% want sunscreen protection included.
     The general message for retailers is to plan for the marketability of multifunctionality.
     Carrying multifunction products has advantages for you beyond marketability. You can reduce the total of different items you need to have in stock. If you’re out of the toothpaste that just cleans, you could point the shopper toward the one that cleans plus more.
     But this works out only if the shopper accepts the quality of the combination offering. Northwestern University found that although shoppers are attracted to multi-solution products, a number of those shoppers believe such products are inferior in each of the capabilities when compared to single-solution products. The product which promises to be a jack of all trades risks being seen as a master of none.
     The researchers found that one way to overcome the inferred inferiority is to set a premium price on the multifunction product. The extra cost helps convince shoppers that the product can indeed do more.
     In today’s retailing environment where consumers are so highly price sensitive, you might choose to take a different approach. Research findings from Singapore Management University and Korea’s Kyung Hee University suggest a technique: Describe to the potential purchaser how well the various functions work together. Instead of focusing on the different capabilities, focus on the added benefits that comes from the synergy.
     The Singapore/Kyung Hee research indicates that this is especially useful with items the shopper considers to have a high level of technological performance. It is more important with smart phones than with toothpaste. In fact, the researchers concluded that at low levels of technological performance, people overwhelmingly preferred the combination products.

Click below for more: 
Pitch the Synergy of Multifunction Items 
Set Healthy Margins on Multi-Solution Products