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Egg rolls for dinner: What a great idea! That was the thinking behind the decisions to launch a line of La Choy frozen egg rolls in 1988. Not measly little appetizer egg rolls, mind you: What managers for the Hunt-Wesson Inc. brand envisioned were big, meaty egg rolls that a consumer would happily eat as a main course. The egg roll offensive would complement another new idea, the Fresh and Lite line of low-fat frozen Chinese entr es. After all, La Choy was a well-known brand name, thanks to its canned goods; ethnic cuisine was soaring in popularity; so were frozen meals. What could go wrong?
Plenty, as La Choy discovered when it rolled out its egg rolls into the East and Midwest. For starters, they couldn’t be microwaved, because the shells got soggy. And it took a very long 30 minutes to heat these giant entr es in an oven. The other Fresh and Lite products didn’t set the world on fire, either. For one thing, there was the name. “It sounded more like a feminine-hygiene product,” says Linda Krakowsky, an ad executive who worked on the campaign. “And it was hard to say it was fresh anyway, because it was frozen.” Two years later, La Choy executives pulled the plug on both the monster egg rolls and the Fresh and Lite line: Today they say they never had the market clout to make these products succeed.
In the long and inglorious history of new-product flops, La Choy is not alone. Put in the context of such historic screwups as Ford Motor Co.’s Edsel
(estimated losses: $250 million), RCA’s VideoDisc player ($500 million), and Time Inc.’s TV-Cable Week ($47 million), a few soggy egg rolls don’t seem all that catastrophic. Producing flops is part of doing business in every industry, from consumer products, where relentless competition for store shelf space drives many new products to quick extinction, to electronics, where rapid technological change dooms many newcomers even after a promising start. Remember the Osborne portable computer?
IS FAILURE ESSENTIAL? And the flops and near-flops just keep coming. Among recent events: Dell Computer Corp. admits it messed up its notebook launch. Toyota Motor Corp. records disappointing initial sales for its much-heralded T100 pickup truck. Coca-Cola Co. struggles to succeed with what looked like a nifty idea–a tiny soda fountain it had designed for office use.
Overall, the new-product battleground is a scene of awful carnage. Chicago consultants Kuczmarski & Associates just studied the success rates for 11,000 new products launched by 77 manufacturing, service, and consumer-products companies. They found that only a little more than half–56%–of all products that actually get launched are still on the market five years later.