One way for middle market firms to compete successfully against the biggest players in their niche is to innovate. A new or significantly altered product that exceeds present expectations is the most effective weapon against large competitors, who can use economies of scale to hold down prices or marketing dollars to saturate the market's share of mind.
On the other hand, creating a new or greatly adapted product is risky and costs significant time and money. A successful product launch can only happen if every step of the process, from conception to rollout, works properly. If just one piece goes awry, it can derail the entire project — often without executives realizing it at the time — and cause the firm significant financial and reputational damage.
Here are four ways to maximize the possibility of a successful product launch:
1. Develop a Product With a Feasible Market
There are many things customers and prospects would love to have, but can you produce them at an acceptable price? Market research along with interviews of existing customers and other prospects must confirm need, features and price range, but don't view this as definitive proof. Besides research and development people, "managers must engage brand teams and marketing, sales, advertising, public relations and web professionals early on to gain valuable [internal and external] feedback that can help steer a launch, or abort it," write Joan Schneider and Julie Hall in an article for the Harvard Business Review. "Hearing opposing opinions can be painful, but not as painful as launching a product that's not right for the market or has no market at all." While brainstorming the right features, firms must make sure not to cannibalize too many elements of existing products unless they're willing to phase out some in the event of a very successful launch.
2. Sell Your Product's Features to That Market
At a certain point, using existing data and customer or prospect feedback based on your hypothetical no longer serves the purpose of developing a new product; you've reached the chasm of unknowns. Frank Robinson, CEO of product-development firm SyncDev, says in a recent Forbes article that leaping this chasm entails actively selling the product to the potential market. Firms must "define their market segments and potential customers by name, location and decision-making team" and get in front of them to see whether that direction is correct. By selling the product to these people rather than simply asking questions, the firm learns two things: whether or not the target market understands the product, and which features should be removed or revised. Go back to the drawing board if it takes more than a moment for prospects to get it. Repeating this selling approach a few times with each prospect will bring deep insight that allows the firm to refine features and sales pitches before production and rollout.
3. Create and Market the Minimum Viable Product (MVP)
Build the solution with only those features that make it the minimum viable product (MVP) that can launch with sufficient sales volume and decent margins. However, ensure that competitors cannot copy it quickly. Wait and build additional desirable features into future versions, which will minimize the number of revisions customers want to the initial product. This will lead to better customer reviews and preserve a longer momentum arc for product marketing.
A firm should spend a significant amount of time, effort and money on marketing. After all, the market for a new product is never certain; buyers must be educated in order for the product to gain a foothold. Once the MVP comes into sharp focus, make sure to use the right marketing channels and resources. Through direct financial investment and in-kind efforts, a firm should promote not just the new product's mission and initial features, but also some of its future capabilities to demonstrate the organization's expertise and commitment to the product's life cycle.
Just as a company must define its market for a new product, so must it define and become active in that marketplace's most-used channels. Further, the company can leverage its present exposure in its existing markets. Even if the product isn't an ideal fit, the exposure reinforces the firm's innovation and encourages customers to spread the word among those prospects beyond the firm's reach. One possibility is to use present marketing channels to offer discounts or rewards to current customers who refer prospects. Prepare the entire company to promote the new product through their social media channels, using pre- and post-launch timelines along with clear guidelines for content and style. Be ready to respond to and minimize negative comments across social media. Have a plan of action to respond to poor reviews on ratings websites and in consumer or industry chat forums.
4. Be Prepared to Revise and Scale
For the former, encourage customer feedback through small incentives. This ensures that the next version is more robust and streamlined. For the latter, make sure that the supply chain and workforce has overflow production and service capacity. Having no set plan to handle high success is equally deadly and more demoralizing than other missteps associated with product launches.
Has your company ever had a difficult product launch? How did you evaluate the process, and what did you learn? If you've had a launch that was largely successful, what steps helped you along the way? Tell us by commenting below.
Rob Carey is an NCMM contributor and a features writer who has focused on the business-to-business niche since 1992. He spent his first 15 years at Nielsen Business Media, rising from editorial intern to editorial director. Since then, he has been the principal of New York-based Meetings & Hospitality Insight, working with large hospitality brands in addition to various media outlets. Circle him on Google+.