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So analytical, yet so wrong

by on
in Leaders & Managers,Leadership Skills

Fresh from graduating Harvard Business School, Bob Seelert joined General Foods’ product management staff in 1967. His first assignment: Help launch Start, an instant breakfast drink.

“Little did I know it was about to become the single biggest disaster in the company’s history,” says Seelert, who became chairman of global ad agency Saatchi & Saatchi years later.

General Foods had test-marketed Start for two years and detailed every aspect of the product launch including the tagline for its TV commercial (“The trouble with Start is to stop”). The company sent 20 million samples to U.S. households.

“It was an orange powdered drink like Tang,” recalls Seelert, author of Start with the Answer. “But we expected it to do double the Tang business.”

Then came a wave of problems. Florida’s orange crop was huge that year, making fresh-squeezed juice cheaper. That lowered demand for powdered citrus drinks.

What’s worse, the samples didn’t make a lasting impact with shoppers. Seelert says that people liked their free sample but “forgot about it” on their next visit to the market.

Seelert’s job was to track early sales and use the results to project total volume. The company expected to sell 2.5 million units of Start, but Seelert concluded the amount would be 1.25 million.

He kept warning his bosses that they were being overoptimistic. But they ignored him because they didn’t want to admit defeat. Start’s final sales were almost exactly what Seelert predicted and the company killed the product within a year.

Lessons Learned

General Foods lost $6 million launching Start. “I was the only guy within 50 miles of that product who was still at the company afterward,” Bob Seelert says. Here’s what he learned:

Listen to everyone on your team. Had Seelert’s bosses heeded his warnings about Start’s dismal projected sales, they could have adjusted the budget accordingly. But office politics got in the way. Plus, he says he was “the lowest guy on the totem pole” so people ignored him.

Balance analysis with common sense. “If you’re too analytical, you usually screw things up,” Seelert says. His preferred formula: one part brains, two parts common sense.

Stay close to customers. The company spent so much time and money on advertising strategy that the actual buyer was overlooked. Later in his career, Seelert would seek out customers, solicit their input and use their feedback to shape his strategy.

 

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