Thousands of new products hit the market every month. More than 80 percent of them fail for a variety of reasons. In some cases, there is no demand for the product even though it’s innovative and well made. In others, the pricing is incorrect or the product is just plain bad.
Entrepreneurs, budding and experienced alike, would do well to ask themselves these five questions before embarking on a new product launch.
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1. Are there any similar products out there?
One of the biggest mistakes product designers make is thinking that only they are smart enough to come up with something. For example, if Elisha Gray had been quicker to the patent office than Alexander Bell, we’d be discussing the Gray System and regional Gray operating companies.
Others are out there who are as smart as you (if not smarter), so you should study which products already exist before going in a certain direction.
2. How can you differentiate yourself and your products?
When you roll out a new product, there has to be a “hook.” Either the product has to achieve better results than existing products, achieve similar results more efficiently with more style and flair, or both. In short, your new product must be noticed.
Additionally, you can position yourself and your company as “better” than the competition. You could be more environmentally conscious than your rivals. Alternatively, you could display greater concern for your customers’ well-being. It’s not just about saving money with customers. Customers will be loyal and pay a little extra if they feel valued. By giving the impression that you’re maximizing value, you’re building up trust and loyalty in your customers.
3. How can you make sure you can deliver what you promise?
We’ve all heard the catchphrase “It slices! It dices!” Indeed, the Veg-O-Matic™ did what it said it did in 1963. The Popiels started the entire infomercial system with that product. In fact, the product is still available today, 54 years later, even though there are all kinds of electronic and computer-programmable souped-up kitchen gadgets on the market.
Why is a low-tech, five-decade-old item still so popular? The answer is easy: It works. It delivered on what it promised. At the other end of the spectrum, New Coke® is regularly used as an example of what not to let happen to you. It promised great flavor, and people hated it. Two weeks after it launched, it was gone.
Do tests. Perform studies. Look at every angle from multiple directions. Make a prototype of your product and collect all the information you can before you even think of releasing a product. In short, do your due diligence.
4. Speaking of testing, what do you have to do to make sure your product is safe?
In 2007, CBS and its partner, Planet Toys Inc., were sued because one of the toys based on its hit show “CSI” allegedly contained fingerprint powder made from asbestos. Tests of the powder were inconclusive, but the damage had been done. The toys were recalled, and both CBS and Planet Toys Inc. were left with egg on their faces.
To make sure any products you release, and not just toys, are safe, you should become thoroughly familiar with all of the policies and procedures set forth by the Consumer Product Safety Commission. It would also be wise, if your product is edible in any way, to consult similar regulations enforced by the FDA.
5. Do you have a backup plan?
Despite all of your preparations, not to mention your brilliant ideas, your product might fail for reasons beyond your control. If this happens, it pays to have a few eggs in other baskets. Always diversify your portfolio of products so that you are not left in an untenable position.
Unveiling a new product is risky. With great risk, however, comes great reward. If you do your due diligence and rely on both your common sense and these precepts, you will set yourself up for the best possible chance at success. Needless to say, these are not the only ideas and strategies you should consider. In the same way as you should diversify your product portfolio so that you have a backup, you should also conduct a thorough research when planning for a new product launch.