Reckitt Benckiser: Fast & Focused Innovation

Topics: Revenue, Innovation, Entrepreneurship Pages: 4 (808 words) Published: August 23, 2012
oCEO – Bart Becht
oReputation for rapid product innovation and industry leading profit margin oPowerbrands – a collective list of RB’s 19 Top Brands
oCompetitors: Procter & Gamble, Unilever, SC Johnson and Clorox


Steady double-digit growth
Attracts a devoted customer base
Achieves 60% gross margin
26.4% net profit margin
Accounts for 70% of RB’s net revenue
Did not sell in as high volumes as P&G
De-emphasized R&D – receives budget of only 1.5% of net revenues

12 – 13% of revenues are invested into new product marketing for Powerbrands Industry standard budget on advertising: 6% or 7% (RB is double) 30 – 40% of net revenues came from products introduced in the previous 3 years – symbolizing a disproportionate level of innovation in products compared to competitors SPEED – crucial differentiator – first mover advantage

Focus on 19 Powerbrands – growth is much higher in the Powerbrands because they are in high-growth categories where RB has very strong positions Incremental approach to innovation – innovations on existing products.


Re-invention of a standard, usual product into a specific, market-niche product e.g. Nurofen analgesic to Nurofen Express – fast-acting version Ensuring the global rollout of products e.g. Vanish, Veet, Airwick, Quick to integrate its acquisitions such as Boots Healthcare, Adams Respiratory, SSL international to RB’s business model Creating an entirely new product category separate from the traditional e.g. Airwick – a high-end, premium, wall-mounted airfreshener that released freshener into the surrounding are at fixed intervals.

By Peter Drucker
Innovation is the specific function of entrepreneurship
It is the means by which the entrepreneur either creates new wealth-producing resources of endows existing resources with enhanced potential for creating wealth....
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