• Brands often withdraw a certain product from the market for multiple reasons. 
• The strategy can be beneficial and disastrous for the brand, so use it wisely. 

Brands must know when to withdraw the product from the market; it can be an effective marketing strategy with multiple benefits. Departing a product can be a surprisingly effective marketing strategy, but only under specific circumstances. It is a double-edged sword or a minefield that requires careful consideration. Withdrawing the product

This withdrawal can be either permanent or temporary with a planned relaunch. Sometimes, this strategy is used with a message that emphasizes the product’s limited availability or upcoming discontinuation. Interestingly, the strategy leverages specific human psychological traits and market dynamics.

Withdrawing the product creates a sense of scarcity, making it more desirable and could increase the demand. Consumers are often susceptible to Fear of Missing Out (FOMO), which could influence them to buy it before it’s too late. The perception of having access to a soon-to-be-withdrawn product can create a sense of exclusivity. Sometimes, this tactic can revive declining sales by renewing consumer interest.

How did H.J. Heinz Revive an old product using the withdrawal of the product strategy? Withdrawing the product

Before understanding how Heinz revived the product, here’s a brief history. Salad cream has been believed to be a traditional British salad dressing choice for almost 100 years. The flavor and texture of the dressing are between the vinaigrette, often known as French or Greek dressing, and mayonnaise. 

But in the later part of the twentieth century, mayonnaise slowly replaced the dressing. This compelled H.J. Heinz 2000 to announce the withdrawal of their salad cream due to falling sales. At the time, the media immediately leaped onto the story, resulting in public outcry and creating mass publicity for the product. 

Dramatically, it led to increased sales, plus the product now has its website, complete with a chef, Dan Green. He also creates mouth-watering recipes that consumers can make using the salad cream. Green offered recipes for beef wraps, spaghetti nicoise, couscous with wok-fried vegetables, etc. The website also claims the salad cream has 66% less fat than mayonnaise, a notable benefit.

Once, Heinz was about to withdraw the product from the market due to poor sales. But now it’s among their best sellers, plus the company is investing 5 Million Pounds a year in promoting the brand. Also, the advertising agency Leo Burnett has produced multiple innovative and entertaining advertisements taking salad cream back to the mainstream. 

What are Various types of Withdrawals? Withdrawing the product

There are three main types of product withdrawal: Permanent, temporary and limited-edition withdrawal. Permanent withdrawal of a product is completely removing it from the market. Significant reasons for permanent withdrawal could be an underperforming or outdated product or the company planning to focus on more successful ventures. 

Sometimes, companies go for a temporary withdrawal with the intention of relaunching the product later on. The reason could be similar to permanent withdrawal. Also, it could be a part of a strategy where a company tries to create a new product buzz or reignite the demand when they come with the upgraded product. 

Brands like Nike, Louis Vuitton, etc., and some sports car or supercar manufacturers like Lamborghini, Ferrari, Pagani, etc., launch limited edition products. These products are meant to be withdrawn after some time to enhance their exclusivity and desirability.  

The “withdraw the product” strategy can increase sales, exclusivity, and brand image if used strategically. However, experts highly advise marketers to use this tactic cautiously, as it has the potential to backfire. It can ruin the brand image, consumers might not be as hyped as expected, etc. Like Schrodinger’s cat experiment, the cat can be dead or alive, only if you have the guts to open the box. 

Case Studies on How Brands Used the Strategy

Although withdrawing the product can be risky and tricky, several brands have successfully used this strategy. With its strategic implementation, they were able to turn a failing product into an opportunity to strengthen the brand image and build a trustworthy image amongst consumers. 

Johnson & Johnson’s Tylenol Recall: 

It was the year 1982, and nearly seven people reportedly died after consuming the Tylenol capsule laced with cyanide. The J&J team took swift action on the news and initiated one of the most extensive product recalls in history at the time. Within a few days, Tylenol capsules were removed from the shelves nationwide. 

Plus, Johnson & Johnson launched a massive public awareness campaign informing consumers about the contaminated product. Although the death of around seven individuals was tragic, J&J’s swift response and commitment towards consumer safety were commendable. By successfully using this “withdraw the product” strategy, the company rebuilt the trust lost due to the incident and maintained its market leadership. 

Toyota’s Unintended  : 

The Japanese automobile manufacturer Toyota faced serious accusations between 2009 and 2010, that their vehicles are experiencing united acceleration. This sparked a massive safety concern worldwide and tarnished the company’s reputation. The issue led to multiple accidents. However, the actual death count is debatable. 

Initially, the company showed some resistance, but ultimately, Toyota issued a massive recall notice for millions of vehicles globally. Moreover, the company made significant changes in its manufacturing processes and quality control to avoid the recurrence of similar incidents in the future.  

Although the recall had a severe financial impact, Toyota’s commitment towards addressing the issue head-on helped immensely. It significantly mitigated any long-term damage to the brand’s reputation. Their focus on transparency and customer communication helped them regain the lost trust. 

The infamous Samsung Galaxy Note 7: 

In 2016, Samsung launched its flagship smartphone, the Galaxy Note 7. Soon after its launch, the product started experiencing severe battery overheating issues. Sometimes, this overheating leads to fires and explosions, causing airlines to ban the smartphone onboard. Many videos surfaced on the internet at the time showing Galaxy Note 7     exploding, tarnishing Samsung’s brand image. 

Samsung issued a global recall of all Galaxy Note 7; they also discontinued its production till the cause was rectified. It also offered its consumers full refunds or replacements. Although the recall took a financial toll, the company’s swift decision and active approach towards consumer safety helped the brand build trust over time. Furthermore, the company implemented stricter control measures to avoid future recurrence of such events. 

What are the Pros and Cons of Using “Withdraw the Product” Strategy

Case studies on Johnson & Johnson, Toyota, & Samsung show how these brands benefited from the strategy. Heinz’s case study also shows how it boosted the sales of products they were about to withdraw. As with every strategy, there are specific pros and cons related to this strategy as well. 

Pros

Withdrawing the product could reduce costs, eliminating production costs, inventory, marketing, etc. By discontinuing certain products, companies can focus on core products and redirect energy and resources to promising products in the portfolio, thereby maximizing results. 

This strategy can also help brands preserve their reputation, as it would showcase their commitment towards quality. In some cases, like Heinz, the withdrawal announcement can create a sense of urgency and scarcity, which could drive sales. By carefully observing the market reaction after withdrawal, marketers can gain valuable insights that can be used in the future. 

Cons

Despite the apparent advantages discussed above, incorporating the “withdraw the product” strategy has disadvantages. It could lead to a potential loss of revenue, customer dissatisfaction, a missed opportunity, and damage to the brand image. Plus, some logistical challenges are associated with the strategy. 

Even if the product is underperforming, it could generate some revenue; a total recall could mean saying goodbye to an established revenue stream. Loyal customers of the withdrawn product might feel disappointed, leading to customer dissatisfaction. If the withdrawal triggers the demand, the company might take advantage of the opportunity to revive the product. 

Brands must avoid frequent withdrawals, as it paints the image of an unreliable or manipulative brand. It significantly hampers the overall brand image. Also, withdrawing the product involves complex logistical challenges, including inventory management, communication with retailers, and handling potential returns. It is a time-consuming and costly process indeed. 

When should you consider Withdrawing the product strategy? 

It’s a crucial decision and must be taken after careful consideration of all related aspects only. If a particular product shows a persistent decline in sales and low return on investments, it’s a sign that the product is not resonating with the market anymore. 

Also, if the market seems saturated with superior alternatives or cheaper substitutes, maintaining the product on the shelves can be an uphill battle. Market trends and customers’ tastes keep changing; if the product does not align with the latest trends or consumer preferences, it is time to withdraw. 

But before withdrawing the product from the market, brands must ensure they have a viable alternative and groundwork ready to manage customer expectations. The withdrawal process must also adhere to all the legal and regulatory requirements and consumer safety. 

All the pointers discussed above clarify the “withdraw the product” strategy concept. The strategy has the potential to revive the product, reaffirm the brand image, and allow the business to stay relevant in this ever-changing landscape. Before incorporating this strategy, make sure you have all the groundwork ready.