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[T1017]To Launch A New Product

by Peter Lawless, Pet

Why launch a new offering from your company?
There are three principle reasons that new products are launched, they are as follows:

1. To satisfy additional customer demand.

2. Spotting an additional way of adding value to your existing portfolio, in a new or existing niche.

3. As a means of diversifying, to either grow the business, or to protect future earnings as a cash cow, reaches end of life.

If you have not already decided to add to your offering, it may be worth checking to see if any of the above criteria are applicable to your company.

So let's assume that you have decided to launch your new product or service, your first step is to examine, if the business case stands up in its own right.

This simply means that you need to write a business plan, as though you were launching a new company. The only key difference is that you will be able to factor in existing resources that you will use to make, market, sell and service your new offering. You should also look at the impact the new venture will have on your existing business.

I am assuming that you know how to write a successful business plan, if you need any help, you may wish to contact one of our partners at Exit Plan ltd, who can facilitate your planning session.

The key market planning activities.

Let us turn our focus on to the key marketing planning activities that you need to embark upon:

Research your target market - You will need to gauge the size of the market, and their propensity to buy this new offering.

Price your Product - A previous article, pricing for profit, will help you with this.

Test your offering - This is absolutely vital, and the remainder of this article goes into detail, on how that should be done.

Launch your Product - Your testing will have helped you create your marketing plan, and this is what you will now set into action.

Sell and service your offering - finally you must ensure that you have capacity to meet demand. Nothing kills a new product's future success than potential customer's inability to get hold of the product.

Testing your new Product or Service

If possible the best group of people or companies to test a new product with is, your existing customers. If you have serviced them well in the past, they are far more likely to do you a favour, and give you honest feedback.

If the new offering is not applicable to your existing customer base, then pick a test group, as representative of your identified target market as possible. They should also if possible be conveniently located to you, so that you can respond rapidly to any teething issues that may arise.

Your test customers, not only help identify any issues, most importantly, they will provide you with testimonials, which demonstrate the following.

Why they need or desire your offering in the first place?
What is unique about your offering?
What your offering enables them to do?
How they put a value on it?
Why they believe it is superior to doing it themselves or using a competitor?

Assuming your testing goes well and you decide to do a full blown product launch, you have now created the marketing message that you should use through the testimonial process.

If you need help with any of these stages, or indeed the final marketing launch, please do drop us a line, or request a free sales and marketing assessment.

A good share of the entrepreneurs I know have a tendency to extend their product range in a very curious, oportunistic way. Whenever the market has more opportunities than suppliers, I see entrepreneurs deciding "Let's do this, too. We can do this, why not doing it?"

For this reason, they end up developing unrelated products that eventually lead to parallel businesses, very time and effort-consuming for the small business. An entrepreneur should first be able to address the following two questions:

- why does he feel the need to take such step, launching a new product or service?
- will the product contribute towards a better strategic positioning of the company?
- will the product help sustain the company's message for the target market?

Some other issues should be considered and answered too, before deciding to add a product to the company's range:

- will the new product cannibalize the existing products?
- if a new product is launched, will customers still purchase the previous products?
- the new product's market is a new one, or is it the same market as for the older products (is the business truly extending, or it is just being updated?). A business update is surely not a bad idea, but not if it comes as an unexpected result: the entrepreneur invests to extend the business and in return he only succeeds to replace older products with new ones.

Extending a product range should occur only when the target market is ready to buy something new. This is especially true on emerging markets, growing markets that need time to assimilate and learn new products, according to existing needs. If a product is launched too early in the market's development stage, one should brace himself for failure, or at least for a costly adventure: marketing the new product can require more time and money than planned and expected. Extending the products range for a small business is actually a matter of inspiration rather than perspiration (read: "research") since market research is often too costly for the small biz entrepreneur - thus extending the products range is a pretty difficult task: what products can you offer to people who are already buying?

When adding new products to the business, focus become the crucial aspect, and not the number of products being launched. If several new products are to be added to the range, they should be positioned for different targets and must be taken care by different teams. You can't give the market two products at one and you can't have one single team in charge of launching two products. Multiple products should be launched simultaneously only if the target market is large enough and there's an equally large team to manage it.

Two frequent mistakes made by small biz entrepreneurs are lack of innovation and focus. More exactly, they might launch products that are too "down to earth" (read: "boring") for an expanding market, or products that don't comply with the overall business strategy and direction. If the launch of a new product was successfull, sales should get a boost, but if the launch failed withdrawing the product is probably the best option. A frequent syndrome when it comes of small businesses stretegy is that of buried costs: the entrepreneur insists on keeping a failed product thinking "something" can be done with it or else the money spent on development and launch are lost.

If the new product was a failure, it is theoretically possible to try a re-launch, a re-branding or a different communication campaign; though, most of the times it's simply the wiser to just eliminate the product and cut the possible further losses.

To conclude, here are some major question a small business entrepreneur should ask himself before launching a new product:

- will the product contribute towards a better strategic positioning of the company?
- will the product help sustain the company's message for the target market?
- will the new product cannibalize the existing products?
- if a new product is launched, will customers still purchase the previous products?
- the new product's market is a new one, or is it the same market as for the older products (is the business truly extending, or it is just being updated?).

Article Source : branding concept

About Author

Both Peter Lawless & Otilia Otlacan are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Peter Lawless has sinced written about articles on various topics from Customer Service, Business Marketing and Mortgage. This article was written by Peter Lawless, founder of . For previous articles like this, visit 3R's Articles. Alternatively, subscribe to Success our free mo. Peter Lawless's top article generates over 27100 views. to your Favourites.

Otilia Otlacan has sinced written about articles on various topics from Marketing Strategies, Self Improvement and Motivation and Marketing. . Otilia Otlacan's top article generates over 9900 views. to your Favourites.