Creating a product can be one of the most rewarding experiences for any entrepreneur or business. It is challenging, usually involves working with smart, creative people, and can be financially rewarding when done right. We’re surrounded by successful products, so there must be some formula that works. But what does it take to be one of the success stories in your own business?
Those of us who live in the world of product development spend a lot of time studying and sharing how to do product development right because the key to great products is great product development. But what else should you know about bringing a new product idea to market, especially a product that does well? The answer — plan, build a great team, and be ready to adapt. It sounds simple, but like most things in business, knowing what others have learned over time can make all the difference.
Good news: We have boiled it down for you in this article. It should give you an excellent introduction to planning and what to expect. Couple this knowledge with the all-important product development process, reliable production partners, and impactful marketing and sales, and you will realize your new product goals.
The 6 Must-Do’s for a New Product
Yet, it is common knowledge that many new products fail. One study that looked at research on failure rates shows data pointing to a 40% failure rate. Although not as high as the urban myth of 80%, 40% still too high if you are that 4 in 10. Why do they fail? Every product and every company is different, but most of the time, a product that fails to make it does so because the company failed to do one or more of the following:
1. Capture What the Customer Wants and How Much They Will Pay
The common failure this step avoids: Making a product no one wants to buy.
People repeat this basic idea so often that it almost loses meaning. Yet, it is fundamental to success. Product market fit is making sure you end up selling a product that people in your target market are willing to pay for. And that starts with understanding what they want and what value they perceive. Understanding this requires excellent market research before beginning product development, during product development, and after the product is on the market.
Use brainstorming to explore all the business ideas that might apply to your product and determine what types of products you want to sell. Turn the results of your market research into functionality that your target market is willing to pay for. You may want to explore implementing a lean product development strategy, an approach built around delivering customer value.
2. Plan Out the Whole Process
The common failure this step avoids: Not having the resources to get your product to market.
Bringing a new product to market is not something you want to figure out along the way. Planning is key at every stage and should capture what needs to be done, how much it will cost, and how long it will take. Planning starts with a business plan to capture the project’s high-level technical, financial, and business aspects. The business plan is followed by planning in every aspect of the effort, including a product development plan, go-to-market plan, supply chain strategy, and production plan.
3. Focus on Sales and Marketing
One of the most common mistakes new product managers or entrepreneurs make is believing so strongly in their product that they think it will “sell itself.” The idea “if you build it, they will come” is a great line in a great movie, but seldom happens in the real world. No one will buy a product they don’t know about or struggle to purchase. To succeed, you need to invest in and prioritize sales and marketing.
Many small businesses owners and startups believe success will come if they put their product online on Amazon or create an online store on Shopify and wait for the customers. An online business that sells through e-commerce may be the best way to sell your product, but you will also need to market for your product launch and beyond.
This includes content marketing, email lists, using influencers effectively, mastering SEO, and leveraging social media. Take the time to understand how to sell online and how your potential customers buy. Study trending products and take the time to talk to potential buyers.
If you are selling your own product to other businesses, becoming an e-commerce business will not work. You will need salespeople or a sales channel. Your overall marketing strategy needs to shift to reach decision-makers inside companies and provide leads to your sales team. Your target audience is different, so your social media marketing should shift from Twitter and Facebook to LinkedIn. Create informative podcasts, hold webinars, and provide case studies.
4. Secure Enough Money
The common failure this step avoids: Having to shut down production or make compromises on your product.
New product efforts fail when they run out of money. In business, that is really the only measure of success and failure. Either the tank is empty, or no one is willing to pump more gas in.
To avoid this, you and your team need to prepare a realistic budget for how much everything will cost and how long it will take, and then secure enough money to pay for it all, plus some extra as a backup. The more you have allocated upfront, the less you have to look for later.
If you are part of a small business or a startup, avoid the mistake many business owners make: trying to self-fund or bootstrap because they don’t want to give up too much equity. Always ask for more than you think you’ll need. It’s easier to return what you don’t spend as profit than try and scrounge up more.
5. Build the Right Team
Bringing a new physical product to market is still a human endeavor. And it often involves a lot of people coming together to add their expertise and value, step-by-step.
If you don’t have the right team, from the CEO to the shipping clerk, you end up fighting yourself. Take time to hire the right people internally, find the right partners externally, and be ready to make a change when things are not working out. Learn about the importance of an Integrated Product Development Team (IPDT) and learn how to make them succeed.
6. Expect the Unexpected
The common failure this step avoids: Stopping the product development or sales process dead in its tracks.
As you can see from the other items on this list, it’s very important to know what will happen and plan for it. And, sometimes, things go according to that plan. But when things don’t go according to plan, it can be catastrophic. One way to avoid problems is to anticipate and be ready for them.
Here are some common unexpected occurrences that can throw your new product development project off track:
- Unexpected costs
- Unplanned schedule delays
- Key team members leave
- Critical partners back out
- The supply chain doesn’t cooperate
- Competition pops up
- Marketing is not getting your message across
- Sales are not converting prospects into customers
- The world changes (COVID-19, anyone?)
- Funding is hard to get
- Funding goes away
- Manufacturing problems
- Retailers or distributors don’t promote your product
- Distribution problems
- Bad impressions
- Poor reviews
An article can be written on each of the above items, and there are probably three times as many bumps and pitfalls laying in wait for product companies. Just know that they are out there, and plan for how you would react to each of them.
Partner With People Who Already Know How to Create a Product to Sell
One way to lift the burden of doing all this research, planning, budgeting, and pivoting is to find partners who have done this before. Most of these tasks are now automatic for those who have been in the new product introduction world for a while. So why not benefit from their experience?
One of the best ways to find those experts is through Gembah, the first global product development marketplace. We connect you with creators, experts, manufacturers, and partners in our network. Our platform consolidates the entire product development process in one place. Make your product development journey more rewarding by reaching out to talk with our team today.
