Perspective: New Product Failure Rates: Influence of Argumentum ad Populum and Self-Interest


  • George Castellion,

  • Stephen K. Markham

Address correspondence to: George Castellion, SSC Associates, 66 Stamford Ave., Stamford, Connecticut 06902. E-mail: Tel: (203) 323-5778.


A persistent myth in product innovation and management is that the failure rate of new products is 80% or higher. How does this false idea continue to displace the conclusions of empirical studies since 1977 that the new product failure rate is 40% or less? We examine the influence of a fallacy that encourages people's unthinking acceptance of ideas on new product failure rates and whose appeal rests primarily on an emotional, rather than a reasoned, argument. Self-interest also plays a major role in keeping this myth alive.