Most businessmen dream of creating a new product. They are passionate about the idea of selling a product or service that competitors do not. Moreover, this should be such a product for which customers will line up. The idea is good, but not many manage to find it, much less realize it. How to bring a new product to the new market, which in the future will leave no chance for competitors?
Task difficulty
Launching a new product on the market is not easy and quite expensive. In this regard, many entrepreneurs at the very beginning of the journey are losing ground. Upcoming difficulties scare away beginners. However, introducing a new product to a new market is a feasible task. When developing the right marketing strategy, as soon as possible, you can ensure that the product or service takes a leading position. An entrepreneur only needs to be prepared for the fact that it is unlikely that at the initial stages a new product will begin to make a profit.
Choosing the right strategy
Based on existing practice, we can conclude that the conclusion to the new market of a new product involves significant risks. This leads to the fact that the implementation of an idea is not always successful.
In order to minimize risks, it will be necessary to apply the right marketing and use the necessary techniques to attract the attention of consumers to a little-known product that has just appeared on the market. Only this will make it bought and in demand. How to achieve the desired result? For this, it is important for each manufacturer to use marketing tools that will allow them to produce the product they need for the consumer, selling it when necessary, where necessary, and at a price that would satisfy the customer.
Currently, many different techniques have been developed that facilitate the launch of a new product on a new market. In this regard, entrepreneurs and businessmen will need, first of all, to study the existing arsenal of marketing tools and learn how to use them correctly to implement their ideas. Of course, in any tried and tested methods of strategy and methods of promoting a product or service, each manufacturer must make their own nuances that will be dictated by specific conditions. After all, classical techniques work as efficiently as possible only if they are adapted to a specific business.
Be that as it may, the launch of a new product on the market, before it reaches the buyer, must go through certain stages. They begin with the development of a concept and end with commercialization. The strategy for introducing new products to the market may vary. That is why we will consider a general idea of the steps for promoting goods and services.
Idea development
Where does the creation of a new product begin? From generating or searching for ideas. They can come from company employees and scientists, customers and competitors, dealers, as well as senior management.
The marketing concept considers the most logical starting point of this stage to identify the needs and desires of consumers. After all, customers who are most professionally using products already manufactured by the company are the first to notice everything that needs to be improved. The company can learn about the needs and needs of customers by organizing surveys, group discussions, projective tests, as well as considering complaints and suggestions from consumers. In the history of world business, there are many examples where good ideas are born from engineers and designers after surveys of consumers are carried out that tell about their problems while using the product.
To create a new product, many companies use offers from their employees. Moreover, the desire to create new ideas by employees, as a rule, is encouraged. So, Toyota employees offer about 2 million new ideas every year. Moreover, 85% of them are implemented by the company. And the Kodak company rewards employees with the best ideas with gifts and cash bonuses. This practice is accepted in many other companies.
Good ideas sometimes come when studying competitors' products, due to contact with dealers and sales representatives of the manufacturer. There are other sources that enable companies to start creating a new product. Sometimes they are inventors, commercial and university laboratories, industry publications, etc.
Idea selection
Any company collects proposals received. In the future, they are considered by the head of ideas. He divides the proposals into three groups - promising, dubious, and also unpromising. Those ideas that belong to the first category are subsequently tested on a large scale. It is important not to make a mistake when selecting proposals. Indeed, sometimes companies reject a good idea, starting work on a hopeless direction. One example of a new product launch is installment trading. At one time, Marshall Field foresaw the unique capabilities of such tactics. But Endicott Johnson did not like this proposal. He called installment trading the most infamous system that could only create trouble.
Product Release Decision
After selecting the most promising ideas of the company, it is necessary to consider the following aspects:
- expected profit from sales;
- the company's ability to accept the idea into production;
- the likelihood of investing in a new project;
- a rough estimate of consumer demand;
- formation of price levels;
- sales channels;
- probability of obtaining a patent;
- assessment of available resources and the level of costs for the purchase of equipment (in the case of the production of a technically complex product).
Concept development
What is the further plan for launching a new product on the market? The most attractive ideas should subsequently turn into a product concept that could be tested. What is she like? Under the concept of goods understand the already developed version of a promising idea, which is expressed in a form that is meaningful to the consumer.
Consider this important of all the stages of launching a new product on the market using the example of a company operating in the food sector.
Suppose her leadership decides to start producing a powder that, when added to milk, can increase its taste and nutritional value. This is only the idea of the product. Further, it must be turned into a concept, which may not be one. For instance:
- Who will be the user of the product? In this case, it may be infants, children, adolescents or adults.
- What are the benefits of the product? Energy boost, refreshing effect, nutritional value or taste?
- When will consumers consume such a drink? During breakfast, lunch, lunch, dinner or late at night?
Only by giving answers to all these questions, it will be possible to begin the formation of the concept of goods. So, a drink intended for production may be:
- Soluble. It will be intended for adults only. It is planned to use it as a quick nutritious breakfast.
- For children. The product will have a pleasant taste, and its use is permissible throughout the day.
- Health promoting. Such a drink will be necessary for older people to drink in the evening.
At the next stage of launching a new product on the market in marketing, categorical is selected from all these concepts. She will determine the area of competition of goods. For example, an instant drink will become an alternative to eggs and bacon, cereals, coffee, muffin, as well as other products included in the breakfast menu.
Brand Creation
What is the further plan for launching a new product on the market? The concept of a product in the next step should turn into a concept of a brand. A new drink needs to have significant differences from existing ones on the market. This applies to its average calorie content and price. The company should not position a new product with existing brands, because otherwise it will be quite difficult to gain its place in the sun.
Validation Concept
What in the future should a marketing strategy provide for launching a new product on the market? At the next stage, the company needs to check the selected concept. This can be done by testing the product with a specific audience of target consumers. This will clarify their reaction.
A plan for introducing a new product to the market may include presenting the concept of a product in a specific form. It can be either symbolic or material. At this important stage of launching a new product on the company’s market, a graphic or verbal description of the product is sufficient. Nevertheless, it should be borne in mind that the effectiveness of the verification will be as reliable as possible when there is a large similarity that can be seen in the tested concept with the finished product.
An example of bringing a new product to the market at this stage is designing it on a computer with the manufacture of a plastic dummy for each of the options. Thus, toys or small-sized household appliances can be created. Such models will allow customers to get an idea about the appearance of a new product.
One of the steps to launch a new product on the market is the creation of virtual reality. This is a computer simulation of the surrounding reality when using touch devices such as glasses or gloves. A similar program is often used to familiarize the consumer with the new interior of his kitchen, the furniture from which will be purchased from this company.
Marketing Strategy Development
How is the new product introduced to the market in the future? In marketing, the next stage in the implementation of a promising idea involves the development of a preliminary strategy plan. It represents certain steps that a company will have to go through to sell its product or service. In the future, some corrections and clarifications may be made to the strategy for launching a new product on the market, depending on the current situation.
The developed plan should consist of three parts. The first of them contains information about the volume and structure of the target market, as well as the behavior of consumers on it. It also describes the positioning of the product, estimated sales, planned profits and market share. All these data are calculated several years in advance.
The second part of the compiled marketing strategy plan contains data on the pre-formed price of the product, on its further distribution, as well as on the level of sales costs during the first year of sales.
The third part of the marketing plan includes indicators of product sales and profit in the long term.
Production and sales opportunities
At the next stage of product promotion, it is important to consider the business attractiveness of the offer. This can be done by analyzing the calculation of estimated indicators of sales and costs, as well as profit.
All must be consistent with the goals of the company. In case of positive results of such verification, you can proceed with the development of the product itself.
Process of creation
At the initial stage, it is necessary to prepare production for the release of a new product. To do this, develop the technology, make the necessary equipment and acquire additional tools and equipment. Next, the production of prototypes or a batch of newly created products. This completes the creation of a new product.
At this stage, test sales should be prepared and carried out. They represent the implementation of a small number of experimental products. Such a move will allow for additional market testing, specifying the population’s need for the created product. With the introduction of prototypes of goods on the market, one should not hope to receive the planned profit. At this stage, it is important to check how customers relate to the product and, if necessary, adjust methods for its further promotion.
Access to the market
At this stage of the launch of a new product, all departments participate in the work and affect all the functions of the company. This is production and sales, procurement and finance, personnel, etc. At the same time, operational marketing is connected to strategic marketing, which will require the participation of a tactical as well as a project manager.
As a rule, at this stage the work of the company is unprofitable, and if it makes a profit, then it is insignificant. It's all about the costs of promotion and further development of distribution channels, which are quite high. That is why, at the initial stages of product entry into the market, only those options that are basic should be offered to consumers, because customers are not yet ready to consider modifications to a new product.
In addition, when introducing goods to the market, manufacturers should pay the main attention to the target audience. In it, product expectations and inquiries are most studied and predicted.
At this stage, an important role belongs to sales channels and the further distribution of products or services. Particular attention should be paid to them. With a competent solution to this problem, a place in the market will be won already in the shortest possible time and at minimal cost.
What will be the choice of implementation system? It depends on the characteristics and characteristics of the product, the image of the company and the product, as well as the company's reputation.
When developing a sales strategy, two options can be considered:
- Direct distribution. In this case, the product from the manufacturer goes directly to the consumer. This scheme is most acceptable for the sale of high-tech goods, as well as for expensive and large transactions.
- Distribution with intermediary firms. Often, trading organizations have a large amount of resources necessary to bring the product to the final consumer. In addition, they provide the buyer with a selection of a wide variety of brands, which allows the client to save time significantly.
When forming a marketing strategy, a marketing plan for product promotion should be drawn up. It should be borne in mind that a universal tool that would allow introducing a new product to the market does not exist. For example, large firms in this case invest impressive amounts in advertising on radio, television and the Internet. They place outdoor advertising, and also carry out the promotion of goods in places of its sale.
Smaller companies are deprived of this opportunity due to lack of funds. As a rule, they use word of mouth, contextual advertising, social networks, etc. In addition, marketers recommend that they do everything possible to ensure that new products placed on store shelves differ favorably from offers from other companies, and bright .
If all the efforts put into the promotion of the product did not bring the expected result, then experts recommend making changes to the strategy for its promotion. In this case, you will need to use other types of advertising and promotions.
At this stage of introducing a new product to the market, it is of particular importance to determine the size of the advertising budget, draw up a promotion program, and also search for the means of communication with which such work will be carried out.
Presentation of a new product to consumers should be vivid and memorable. For this, advertising should focus on the features of the product and its differences from existing analogues. At the first stages of launching a new product on the market, a more rational option is to sell it via the Internet through participation in specialized exhibitions, etc.
As you can see, many factors influence the novelty to successfully enter the market. That is why at every stage of the project implementation, the company must approach the matter comprehensively. This will allow new products to gain a foothold in the market, winning the hearts of consumers and bringing a stable profit to the company.