RPF1JP THE FOUNDATION FOR PRODUCT INNOVATION IN CONSUMER MOTIVATION Success in product innovation rarely relies on novel developments per so. but rather is related to the timing of the appearance of a development in relation to a particular state of readiness existing in the market place. This state of readiness may be brought about by a number of influences including legislature, media, innovations in parallel products, trends in disposable income and. of course, the dynamic evolution of social and personal motivation existing within particular cultures. Much has been made of this latter pdinL In both Europe and the USA over the last decade consumer psychologists have elaborated hierarchical models to explain recent and predicted future trends in motivation style. Such models, drawing heavily on Maslowian theories, indicate that as individuals move beyond concerns related to survival maintenance there ensues a concern for material security linked to outward and socially visible display of achievement. Advancing further up this motivational ladder. the focus of motivation again turns inward and motive themes turn more lo realising individual identity through very personally defined routes. Finally, inhabiting the upper levels of such models we find the so-called setf-actualising individual who represents a balance of individual personal elaboration of values, attitudes and lifestyle while at the same time being attuned to gl@bal social Issues. These models of motivational evaluation are taken to apply as much to social cultures as lo individuals and It has been suggested that Europe and North America represent societies in process of'seff-actualisation'while Third World countries occupy the survival and material aspiration rungs of the motivation ladder. Academic as such models may appear. they have been extensively and successfully used in Europe and North America to predict trends in future product requirements and usage patterns. The value of this way of looking at markets and individual consumers is that. by determining where a culture lies 'on the ladder'. it is possible to determine both the size of opportunity for innovation and the nature of innovation most likely to be In sympathy with consumers' needs in this culture at this point in time. The implication of this is that markets at different stages of motivational development will show (a) very different levels of responsiveness to innovation and (b) quite different needs in terms of the qualities that the Innovation addresses. If we take the common themes of such models as applied in Europe (ACE(RISC) and USA (VALS). we can think of a consumer and cultural typology: Survivalism: dominantin lowersocial classes, predictive of a low concern with innovation and a responsiveness to propositions based on value for money and security within the status quo, Outward Materialism: dominant in aspiring lower middle classes, -C@b predictive of a high concern for visible innovation and a responsiveness C) to high profilocosmetic'novelty conforming to the expectations of others; BATCO document for Province of BritiSh Columbia 14 April 1999 2 Inward Personal Development: dominant in the secure middle classes, predictive of a high concern for Innovation leading to the elaboration of unique individual image building and not necessarily conforming to the peer group; Self Actualisation: also dominant in the middle/upper social classes, predictive of a requirement for innovation addressing higher order issues relating to social change, environmental issues and the Pof society. It is interesting to note that, in terms of this motivation hierarchy, much of Europe shows evidence of advancing more rapidly than North America to the upper level of self actualisabon. as witnessed, for example, by the phenomenon of the adoption of .green' environmental issues. The real picture is, of course, more complex. with different countries in Europe showing quite different current status and rate of progress on the motivational ladder. However, the point remains that the degree and type of innovation responsiveness may be predicted from an understanding of moUvational development. To link the afore-mentkxied typology to requirement for cigarette innovation brings two important insights: 1. As European and North American societies in particular advance on the motivational hierarchy. the need for innovation will progressively Increase. 2. It will become important lo match type of product innovation to the stage of motivational evolution of the market of concern. In tobacco-specific overview, a Survivalist culture Will be responsive to low profile innovation of product and packaging focussed on value for money offers. An Outward Materialist culture will be responsive to strident innovation - lancy'filters and packs, status features that support visible conformity to the peer group, luxury lengths, etc. An Inward Personal Development culture will be more responsive to multiple innovation in imagery, blend style, package configuration and cigarette configuration, eg. slims. Finally. Self Actualisers will be notably responsive to inr*vations in the area of alleged health risk and amelioration of social concern, i.e. sidestrearyVETS reduction and modification. Low delivery products with retained satisfaction would be the innovation hallmark for this latter group, especially when achieved in conjunction with a reduction of product environmental irnpacL The prime conclusion from this analysis would be a prediction that, in advanced Westerm markets, present motivational evolution, stimulated by sources of and-smoking pressure, will lead lo high responsiveness for 'personally and environmentally responsUs'products. An example would be a low delivery product with retained satisfaction in conjunction with low/ameborated sidestream. An alternative routs to understanding the potential for product innovation is to understand the cigarette as a benefit system to which the consumer, depending on -Mal higher motivational state, wig attach an affay of differing values on an C) attribute-by-attributo basis. One universal feature of these benefit weighbrigs (as C:1 typified by recent GRF-ENDOTconsumer research) is that so-called taste/satisfaction LF11 BATCo document for Province of British Columbia 14 April 1999 3 of the product completely dominates other potential benefits in ft product hierarchy (e.g. reduced sidestream, reduced d6bris, etc.). It is important to consider the reason for this in a motivational framework since this finding can easily lead to the mistaken assumption that innovation addressed to anything but taste/satisfaction will have a low utility. Theories of smoking maintenance all agree on at least one point - that nicotine is central to the habit and that the extinction of active smoking following nicotine withdrawal is the evidence supporting this view. More specifically. a mounting body of evidence from cotinine and behavioural monitoring studies shows that humans have a specific optimum requirement for nicotine in the region of 0.9 to 1. 1 mg and will adjust the intensiveness of their smoking style in order to meet and stay within this range. More recent UK behavioural studies indicate that absolute nicotine delivery may, however, be misleading and that tar/nicotine ratio is more likely to be the criterion shaping adjustments in smoking behaviour. Thus, the idea of a 1 mg optimum may be misleading if this has been determined from studies using cigarettes of conventional tar/nicotine ratio. Where tar/nicotine ratio is adjusted downward in experimental cigarettes, there is now some indication that a lower absolute level of nicotine will still be effective in sustaining behaviour. This centrality of nicotine is rather paradoxical in the sense that ft does not have particularly pronounced attributes in itself, apart from sensory impact and a nebulous association with 'satisfaction'. Where nicotine does exert Its effect is via backwardly conditioning its reward value onto other smoking attributes closely associated to it in time. Smoking fits the conditioned learning model very well in the sense that nicotine is a very powerful unconditional reinforcer or 'reward' which very quickly associates 'reward' with other stimuli occurring at the same time as the nicotine is administered. In learning terms this means that, the closer a stimulus is to the actual point at which nicotine is ingested, the more inextricably associated with smoking pleasure it will become and the more likely the absence of such a secondarily conditioned stimulus (for example in an innovative product) will be to disrupt smoking enjoyment and acceptance. A number of corollaries attach to this view of nicotine as a primary reinforcer of behaviour building on hierarchy of learned reward associations around itself: 1 . Sensory accompaniments of smoke inhalation will have the highest reward utility leading to a prediction that smoke taste and textural smoke cues (i.e. mouthful) will always dominate considerations of product preference. 2. OraVmanipulative components of smoking (fighting, puffing, burning down, generating smoke,'playing'Mth ash) will have a high habit value quite resistant to extinction (a product which does not bum down and generate ash will be problematic in this respect). This will be particularly so for low delivery smokers for whom primary sensory cues are already impoverished. 3. Product innovations which impoverish sensory or oraftaripulative cues will Xh- require particularly high external pressures on the consumer in terms of legislation. peer group pressure, ant-smoking communication and product communication N their benefit offer is to overcome the loss of conditioned BATCo document for Province of British Columbia 14 April 1999 4 rewards. The reduced sidestream product, PASSPORT, failed in the Canadian market for this reason (i.e. that the cognitive benefit of reduced sidestream, supported as it was by a climate of public opinion, was insufficient to offset the loss of a strongly conditioned requirement for tastEVsatistaction). It follows from this that successful product Umovation strategy M= be based on retention of optimal nicotine in conjunction with acceptable taste/mechanics. It may be argued that conventional low tar products give the lie to this assertion, but conventional low delivery products still represent a relatively low penetration long term strategy dependent for success on smoker compensation behaviour and habituation to new taste standards over a protracted time scale. However, it must be accepted that everything we are learning about the motivational evolution of European and North American market cultures indicates a strong prediction that fundamental innovation of products is the present and future demand. This is true for food and drink just as it is for tobacco, as witnessed, for example, in the major evolution of beer marketing (low/non alcohol, taste segmentation, packaging innovation) and snacks/last foods. Basic cigarette product innovation may be directed at a number of variables which consumer research can crudely hierarchise for us in terms of salience to target segments, Le.: Reduction of alleged health risk Enhancement of natural tobacco taste Reduction of mainstream smoke irritancy Reductionofemissions: Irritancy srnell smoke haze stale smell after-effects Introduction of novel enhancing flavours Amelioration of smoking debris Novel configurations of product and packaging Novel aesthetics of product and packaging Given the caveat of universal desire for retained taste and satisfaction in the product the marketing challenge will be to target the innovation mix to segments defined according to motivational evolution (i.e. different benefit mixes required by outward materialists, inward personal developers and self actualisers). The enduring point that should be understood by those wishing to promote the future of tobacco business must, however, be that increasing demand for innovation will be the shape of future markets. The evidence for this is already dear in moUvationaVlife style analyses in 2b. the Pan European and North American contexts which show that innovator life style C:) groups are on the increase. C:) -11; C) BATCo document for Province of British Columbia 14 April 1999