Product Launch - Key Elements
Approximately 75% of the new product launches in the capital goods industry fail!
What are the causes that even technically sophisticated products are not successful in the market? What key elements should be considered at the time of market introduction?
Why product launches fail
Lack of research on actual customer needs or customer expectations (tasks, pains, gains) and inadequate market analysis (market segment / target group, structure, potential, price level, competition) are two of the main causes of failed launches and these errors are due to lack of care or insufficient focus already committed at an early stage of the innovation process.
Further causes are misjudgements in the development effort or the implementation in production. Furthermore, disproportionate marketing budget and poor timing are additional reasons for failure.
The 4 key elements of a successful market launch
- A clearly defined market segment or market, which allows efficient and level-oriented market processing, as well as price-positioning that is related to the customer value.
- A product with the right value proposition that fully meets or even exceeds customer expectations.
- A concise and handy advertising message, which contains a measurable value proposition and is based on pure customer benefit.
- A suitable advertising medium that is actually used by the target group and also appeals to the advertising message.
The more clearly a market can be distinguished and the more precisely the target group can be described in this market, the easier it is for the products to be tailored to market needs and the better the value proposition can be aligned to this target group.
Only by deep knowing of the applications in the respective market segment the needs can precisely be identified along the customer journey. This knowledge can later be applied for product promotion precisely to the benefit and touch points of the respective target group within the customer journey. It is imperative for the launch therefore to create value proposition and sales documentation dedicated to the different target groups.
Added value products
There may be a considerable difference between the wishes of a supplier regarding the service offered and the benefit of the product expected by the customer. If this is not congruent, the product appears either too expensive or too poor in quality.
Successful products have already been trimmed to market needs during the development phase and exceed the expected product benefits of the customer.
Through systematic and consistent customer involvement during the development process, it is possible to develop specific market-oriented product features, which bring a marked benefit to the customer. In the later product realisation phase, the desired benefits can be measured using prototype tests and reference installations. In preparation of the market launch, this measurable benefit must then be transferred into a handy value proposition.
I hope that in this first part I could arouse your interest in structured product launches.
I appreciate your comments or contact me directly for more details.
→ Continued: Part 2 Promotional Efficiency