Catching up with Tim Lesmeister, VP Marketing, WD-40 Company

CGT Executive Editor Kara Romanow catches up with Tim Lesmeister, VP Marketing for WD-40 Company, who opens up about how they navigate the challenges of being a mature company with a mature brand in a mature market. He also reveals how a growing international presence as well as a renewed focus on innovation secured WD-40 a spot in more than 80 percent of households.

What keeps you up at night?

Lesmeister: As of today, the economy is a mess, the market is hovering around 8,500, credit is tightening, foreclosures continue to rise and the presidential election is finally behind us. But I believe the worst is yet to come, and we simply don't know what we don't know. In our lifetime, has there ever been a bigger challenge in managing our business in both the short term and long term? Depending on how you look at it, it's the best of times; it's the worst of times. Today's economics impact all of us personally and professionally. 

All of us can manage the risks in our respective businesses. After all, every plan has inherit risk that we need to deal with whether it be cost, competitive activity, failed innovation, customer/consumer dynamics, etc. What is most difficult to manage is the uncertainty that we all face now. It's the unknown. Oil was $147/barrel in July, now it's below $70/barrel. Especially for WD-40, this is a key component in our formula, our packaging, and of course, our freight. Volatility and uncertainty makes things challenging in today's environment. 

How can manufacturers and retailers better collaborate?

Lesmeister: We both face similar challenges in achieving our desired growth whether it's growing top-line sales or driving costs out of our system. We also both rely on innovation as a catalyst for growth, which brings great challenges in the rate that innovation is successful, or even incremental. Approximately 15 percent of new products exceed $7.5 million in sales, and only 1 percent exceeds the $100-million blockbuster status. 

While there is no secret formula for a successful new product launch, diligent focus on key success factors and launch phases will increase the likelihood of a launch success. So, it becomes even more important that we collaborate with our customers early on in the concept phase of a new product's development. An aligned understanding of the consumer's need that is being met, the incremental value that the product is bringing to the category, and price/margin expectations are all based on a solid understanding of the consumer and his or her DNA. 

What unique challenges does WD-40 face as a mature company?

Lesmeister: In the United States, WD-40 is a mature brand in a mature market. Fortunately, we have had two initiatives that have allowed us to continue to post increased sales year after year. One of those is our international presence. We are now in 160 countries worldwide and constantly working on the other 30 or so. The other initiative is innovation. For nearly 50 years the only innovation we had around WD-40 was introducing a new size. It wasn't until recently that we started innovating around new delivery systems such as Big Blast, No Mess Pen and Smart Straw. These innovations have brought new uses, new channels and new customers and consumers that put WD-40 in more than 80 percent of households with more than 2,000 documented uses.

Can you elaborate on the innovation challenges at WD-40?

Lesmeister: Having been involved in other companies' innovation processes, I don't think there is anything unique to WD-40. The challenge we have is that we are a small company with the quantity and quality of ideas of a big company. So, we need to prioritize our time, talent and treasure when deciding what to work on. There are two quotes I always say when it comes to innovation: "It takes as much time and effort to launch a $1 million idea as it does a $10 million idea." So why bother with the first? "It's also better to kill an idea, then to move a potential bad one forward." We use the stage gate process, which works well for us in allowing us to focus on the "right" initiatives and kill the "wrong" ones.