The Innovation Squeeze

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Taking a Store Tour Through Dollar Tree

Last week, I walked into my local Dollar Tree and stopped in my tracks.

On the shelf sat full skincare systems—collagen cleansers, retinol serums, vitamin C creams—each priced at $1.25. Not sample sizes, not clearance leftovers, but complete routines that once belonged squarely in the “masstige” aisle of drugstores or department counters.

A decade ago, ingredients like retinol, collagen, peptides, and vitamin C were locked inside $30 serums or $80 creams. These compounds are hard to stabilize and formulate for efficacy so only companies with labs, R&D teams, and clinical budgets could deliver them. As a result, the products carried prestige positioning and aspirational price tags.

Today, you can buy a cleanser, serum, and cream with those very same ingredients for under $4 total, stocked next to paper towels and dish soap.

And it isn’t just skincare. That same store carried a 3-pack of disposable 5-blade Assure razors (a direct Gillette dupe) for $1.25, about 42 cents each. By comparison, Walmart sells Gillette’s 2-pack of 5-blade disposables for $9.97, or $4.98 each. That’s 12 times more expensive.

When I worked in Gillette’s Blades and Razors group, the brand commanded 70% market share. Over time, that dominance eroded as Schick, Harry’s, Dollar Shave Club, and countless private labels chipped away. The core dynamic is the same: technology that once justified “premium” price points eventually diffuses down to the lowest tier of retail.

So what does “premium” mean when collagen, retinol, and 5-blade razors all sell for $1.25?

Identifying The Innovation Squeeze

Innovation costs money. Formulation science, clinical validation, patents, packaging design, and brand campaigns all require investment. But when Dollar Tree sets the consumer’s reference price at $1.25, the pressure on mid-tier and prestige brands intensifies.

Shoppers today are also more ingredient-literate. Social media has trained them to recognize “retinol” as anti-aging, “collagen” as skin-supporting, “five blades” as superior. When they see those same cues at mass retail, they don’t forget the association, or the price.

Recommendations for Product Developers

Compete where Dollar Tree and many mass retailers cannot go—shifting beyond the product features itself and moving towards a branding and marketing position that highlights the special experiences of your product.

  • Beyond ingredients: Assume commoditization is inevitable. Differentiate on delivery systems, clinically proven efficacy, and long-term results that cheap dupes can’t replicate.
  • Experience as value: Use packaging, sensorial textures, fragrance sophistication, and omnichannel services (e.g., personalization, virtual consultations) to create experiences mass retail can’t match.
  • Credibility and trust: A $1.25 collagen cream may tempt trial, but consumers still look to trusted brands for safety, testing, and measurable outcomes. Highlight proof, not just ingredients.
  • Tell a stronger story: Dollar Tree can sell a retinol serum, but not a 50-year dermatology legacy, a patented delivery system, or a loyal community of advocates.
  • Go where cheap can’t follow: Personalization, AI-driven recommendations, and biotech-derived actives create defensible moats beyond “same ingredients, lower price.”
  • Stay ahead of commoditization: Cycle faster. Launch next-gen actives, formats, or routines before they trickle down into mass retail.

Evolving a Product’s Premium Message

If every masstige technology eventually becomes mass, the very definition of “premium” must evolve. Ingredients and features are no longer moats. The future of innovation will be measured in outcomes, experiences, and trust.

Collagen sets and 5-blade razors may both sell for $1.25, but consumers will still pay more when a product makes them feel confident, cared for, and certain it works. Premium won’t mean “more blades” or “stronger actives.” Premium will mean proof, personalization, and emotional resonance.

The challenge for innovators is clear: Stop chasing features that will soon be commoditized and start building value that can’t be.

Click here for more columns by Gail Martino; if you enjoy this content, please consider connecting with Gail Martino on LinkedIn.

Finding a Winning Concept Testing Strategy

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Reducing the Potential of Product Failures

This early validation helps reduce risk, minimize failures, optimize resource allocation, and ultimately increases the likelihood of a successful product launch. Early concept testing can also help gather feedback and address any potential concerns or issues.

In Fuel Cycle’s “Why Concept Testing is Important in New Product Development,” the company outlines some of the key benefits to this part of the innovation process:

1. Reduces Risk: One of the primary reasons concept testing is important in new product development is its ability to mitigate risks. Launching a new product is a costly and time-consuming process. Without thorough testing, companies run the risk of investing heavily in a product that may not meet market demands or expectations. Concept testing allows you to identify potential issues early in the development cycle, such as flaws in the concept or misunderstandings about the product’s purpose.

2. Validates Assumptions: New product development often involves assumptions about what the market needs and wants. Concept testing serves as a reality check, helping to validate these assumptions. It provides tangible data and feedback from real consumers, offering a clear picture of whether your concept aligns with the desires and preferences of your target audience.

3. Enhances Market Fit: Understanding your target market is crucial in developing a successful product. Concept testing allows you to fine-tune your product concept to better align with market needs. By identifying what aspects of your concept resonate with potential customers and what doesn’t, you can make the necessary adjustments to enhance market fit.

4. Improves Marketing Strategies: Effective marketing is vital for the success of any new product. Concept testing can provide insights into which marketing messages, features, or benefits resonate most with your audience. This information is invaluable in crafting compelling marketing strategies that will attract and engage potential customers. 

5. Drives Innovation: Concept testing doesn’t just identify potential issues; it also encourages innovation. As you gather feedback and make improvements based on the data you collect, you can refine your product concept and make it even more compelling and innovative. This iterative process fosters a culture of continuous improvement within your organization.

More Innovation Resources

Strengthening Product Concept Testing

At TMRE 2024, Ben Harknett, CEO at Cambri, presented the session, “Are KPIs & Benchmarks Really Doing a Good Job of Predicting Product Concept Strength?” Many product launches often fail, and it’s accepted as part of the nature of innovation. But does it really need to be that way? Cambri asserts that by utilizing AI you can now combine quant, qual, and in-market data to deliver more accurate and actionable insights—and from there enhance the product concepts that will succeed.

Aiming for Continuous Concept Improvements

When concept product testing, it’s key to employ a data driven, insights focused approach. Fuel Cycle advises that defining your target audience, setting clear objectives and choosing the right methodology and testing platform is important. Lastly, data collection is a key task but it’s the data analysis and deriving key insights that can help improve your concept and product iteration, leading to a cycle of continuous improvement.

In Dig Insights’ “5 Best Practices for Concept Testing,” the company further expands upon tactics that can help the product development process. For example, engaging with key stakeholders during the process might involve sales, marketing, and customer service to ensure concepts solve real problems and align with business needs.

Another tip from Dig Insights is to treat underperforming concepts as learning opportunities: “Not every idea will shine, but even low-performing concepts provide valuable insights. Instead of discarding them, ask why they failed. Could they work with a different demographic? Would a small tweak change perceptions? Iterative testing allows you to refine weaker ideas and compare them to top performers, unlocking fresh opportunities.”

Video: “Product Testing Innovation: Evolving from CLTs to Real-World Learnings,” courtesy of Highlight.

Amplifying an Innovation Culture

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Setting the Leadership Tone

A culture of innovation sometimes means cutting through the bureaucracy of the organization to encourage creativity and curiosity. A culture of experimentation and risk taking is also important, as is promoting a growth mindset and culture among the team. It also means overcoming the barriers to innovation, such as resistance to change, fear of failure, siloed thinking or a lack of resources.

According to BCG’s “An Innovation Culture That Gets Results,” the culture of an organization can be hard to pin down. Nevertheless, it defines that culture as “the collective behavior that shapes how new products and services get built and marketed to customers. To use an analogy, innovation culture is like software that runs on the “hardware” we generally associate with innovation: the strategies, governance, processes, organizational structures, metrics, and other aspects of the operating model.”

So how as a leader do you ramp up your innovative culture? BCG points to several specific tactics:

  • Clearly articulate the specific behaviors that are most critical to innovation success. Among them: striking a balance between freedom and accountability; encouraging risk taking; and fostering playfulness while adhering to company standards. Companies that take their innovation culture seriously are crystal-clear about how these behaviors are defined: “freedom,” for example, means seeking input, not consensus, while empowering decision making; “encouraging risk taking” means telling teams to dream big, learn from failure, and improve continuously. Companies that lead in innovation culture make sure to cultivate and reward those behaviors.
  • Activate these behaviors through the actions of leaders. An innovation culture is shaped from the top. Leaders articulate an innovation vision for their company and personally engage in key ecosystem outreach activities. They inspire innovation by providing the needed hardware to support the software: the incentives, platforms, and mechanisms for celebrating, cultivating, and rewarding new ideas; the accountability and ownership that teams need to operate unencumbered; and the freedom to collaborate with external partners.
  • Most importantly, embed the core behaviors into the operating model. Innovation culture leaders know it takes more than setting up creative spaces with ping pong tables and espresso machines or laboratories segregated from the rest of the workforce and the company’s day-to-day currents. Culture runs deep: it’s embedded in a company’s incentive systems, policies, processes, and practices. These companies also foster a strong innovation culture in their very hiring practices, seeking new employees that have an innovation mindset as well as those with diverse backgrounds, experiences, and ways of thinking.

Creating an Environment Where Innovation Thrives

During FEI25, Ophelia Chiu, Vice President, Strategic Innovation at Memorial Sloan Kettering Cancer Center, held the session, “Establishing an Innovation Culture Roadmap,” providing a practical framework for cultivating an environment where innovation thrives.

Chiu discussed the establishment of an innovation culture road map. She emphasized the importance of shared experiences and community among innovators. Their strategic innovation team defined three core principles—community, entrepreneurial thinking, and belief in everyone as an innovator—to guide their efforts. They developed the KITE framework to support learning and engagement, while also recognizing the need for tailored approaches based on diverse staff personas. The presentation highlighted the challenges of implementing innovation programs and the importance of fostering an environment conducive to creativity and collaboration.

Watch the above video or see the full analysis of the session in All Things Innovation’s Discussions section.

The KITE Framework

Chiu also shared a practical framework called “KITE” for cultivating innovation culture programs based on her team’s experiences. The framework consists of four pillars: Knowledge, Inspiration, Translation, and Engagement, designed to meet people where they are in terms of content, format, and tone.

  1. Knowledge: Providing learning opportunities at all levels with a mix of formats to create accessible entry points and mechanisms for skill-building.
  2. Inspiration: Sparking imagination and curiosity through experiences that offer excitement and respite from daily routines, such as immersive workshops, TED Talks, innovation days, or hackathons.
  3. Translation: Supporting real-world application of innovation skills by providing consultative guidance to teams doing innovation project work and enabling learning through doing.
  4. Engagement: Sustaining innovation culture by building a community of innovators, fostering belonging and competency, increasing transparency about innovation activities across the organization, reducing silos, celebrating innovation projects, and creating peer support and mentorship.

Winning with Innovation Culture

Every corporate culture operates a little bit differently and may face different sets of challenges and innovation barriers. But as BCG outlines in its study, companies that lead focus on four aspects of their culture to win on innovation: how they create, how they team, how they lead, and which successes they celebrate.

As BCG observes, “Culture leaders clearly articulate the specific behaviors that are most critical to their innovation success, activate these behaviors through the actions of leaders, and embed the core behaviors into their operating model.” Ultimately, through the balance of both the hardware and software of the innovation culture, the team can not only survive but thrive.

Video: “Establishing an Innovation Culture Roadmap,” featuring Ophelia Chiu, Vice President, Strategic Innovation at Memorial Sloan Kettering Cancer Center, courtesy of FEI25.