Marketing Innovation in a Conservative Market
Yad-Mordechai Honey
Honey is a natural product, produced by the honeybee that collects nectar from flowers, processes it, and stores it in the honeycombs in the hive. The Yad-Mordechai company, which leads the honey market in Israel (with 60% market share), is careful to provide pure honey (to which no other ingredients have been added) and to process it using only natural processes.
The average Israeli appreciates honey as a natural, high-quality, and healthy product and associates its consumption with a healthy life. In view of the above, he is not interested in interfering with the honey, which, in his eyes, could damage its naturalness or authenticity. The image of honey among honey consumers, and those who are not honey consumers, is conservative, outdated, and not current, and they do not associate qualities of pleasure, taste, or experience with the product.
Therefore, when Yad-Mordechai approached us at ZOOZ condulting, with a request to help them develop innovative honey products and original olive oils (another natural product from Yad-Mordechai), we understood that the task would be quite complex. We started working together, and as part of the "Spark" program, a government program that subsidizes innovation activities in Israeli factories, we conducted a number of Systematic Innovation workshops at Yad Mordechai. In these workshops, we developed, with the help of inventive thinking tools, many ideas for more useful and convenient packaging for honey. However, Yad-Mordechai's pressing plastic packages, with a patent stopper that prevents the honey from dripping and leaking, which were launched at the same time, were only moderately successful in Israel.
Following this, we also wanted to touch on the product itself. How can the honey itself be changed, without harming the differentiation of Yad-Mordechai - "natural products"? How can one innovate in a field where the more natural the products are and have not undergone any changes - they are considered to be of higher quality, healthier, and more nutritious?
The opening figures were against us. The honey market in Israel is a conservative market, with almost no substantial innovations, and with a very low growth rate. 90% of the sales are of pure honey from wildflowers, which is seen as generic and unremarkable honey in the eyes of consumers. Many competitors, including private brands of the food chains, began to produce this type of honey, biting into Yad Mordechai's market share. It is also worth noting that this is a seasonal market, with peak sales during the Rosh Hashanah holidays. During this period, a wide variety of manufacturers and small marketers join the competition, offering their merchandise at very low prices.
The rest of the sales in the honey industry in Israel are of varietal honey, from a unique nectar source, for example, citrus flowers, eucalyptus, or hyssop (Za'atar), and these products were considered the pinnacle of innovation in the field... So, what can be done after all? How can we invent real innovation, and lead to an increase in sales?
Among the many ideas developed in the Systematic Innovation workshops with ZOOZ, Yad-Mordechai decided to focus on the taste of honey and offer, for the first time ever (new to the world), a honey that combines new flavors from nature, in the convenient packaging that had already been developed earlier. The new series, honey with touches of nature, was launched by Yad-Mordechai in 2008.
To avoid damage to the natural image of Yad-Mordechai Honey, honey with touches of ginger, and honey with touches of lemon were first released. Health and natural values are commonly attributed to these plants. In addition, Yad-Mordechai made sure to extract the plants completely naturally and to preserve the taste of the honey, while the plants only added light touches of the plants' taste. Later, in preparation for Rosh Hashanah, a honey with touches of apple was launched. Then, towards the winter, a honey with touches of orange was also launched.
It became an immediate success: sales of Yad-Mordechai honey in 2008 increased by 18%, when sales of the new series were four times the forecast, and sales of pressed bottles (also of ordinary pure honey) increased by 75%. The products of the new series won the "Product of the Year 2009" award, about 90% of users were satisfied with them, and 86% said they would recommend others to use them.
Yad-Mordechai managed to innovate even in a conservative market, thanks to the careful launch of an innovative, tasty, and intriguing series, but still healthy, high-quality, and 100% natural. Definitely, a honey-sweet success story. And by the way, Yad Mordechai, which is part of the Strauss group, won the "Product of the Year 2009" award also for oil in one and a half-liter can package. The idea for this product also came up in Systematic Innovation workshops held with ZOOZ as part of a "Spark" program. But that's a completely different story...
