How do you develop new products? One of the weaknesses of a significant number of UK companies is that their product development is engineering-led. By this I mean that the R&D department will put together a product and then hand it over to sales with a cheery “off you go and sell it then.”
Astonishingly, everyone (apart from the sales and marketing departments) is surprised when the new product fails to take the market by storm!
It takes time, effort, money AND intelligence to develop a new product and bring it to market. If you want to minimise your development costs and maximise the return on your investment, there’s a logical progression to follow. It looks something like this, although we make no claims that this is the only way.
- Do your market research. At it’s most basic, define the problem your target market is trying to solve and establish how much it’s willing to pay.
- Test internally. Get input from everyone involved – marketing, R&D, procurement, engineering, production, sales, finance – to establish what you can build and for what price.
- Test externally. Go back to your target market and reconfirm what is really important to them because you won’t have got it right first time.
- Iterate the concept. Repeat until everyone is happy that you can produce a desirable product at a price the customer is willing to pay and a profit level you are happy with.
- Build and test a prototype. Test internally to ensure it meets specification. Test externally to discover it does what the target market expects. Iterate the prototype.
- Hand off to production and engineering for a pre-production run.
- Hand off to marketing/sales to develop relevant sales and marketing materials and sell pre-production units.
- Feedback field results. Refine the product and the sales/marketing materials accordingly.
- Train the sales team on what the product does, how it does it and why your target market should buy it.
- Launch the product and promote it via all necessary channels in which your target market lives. These days that means a mix of old methods such as advertising, mailshots, exhibitions and new methods including social media, content marketing, webinars and so on. (Talk to us if you need help on this bit.)
I’ve worked in companies large and small that miss out some of these steps and the result is always disappointment for all concerned. To give you some examples:
- I’ve spent countless hours trying to sell products that the potential customer agrees are very good but he has no need for it. (Poor market research)
- I’ve had embarrassing conversations (and lost sales) because the potential customer has plumbed the depths of my product knowledge with a single question. (Poor sales training)
- I can’t remember how many times I’ve heard “but I’ve just bought something that does that from XYZ Company. I didn’t know you offered it.” (Poor promotion.)
Yes, we appreciate that it takes time, effort, money and intelligence to go through the process outlined above. Yes, we appreciate that in a number of companies, “R&D, engineering and production” might be the same 3 or 4 people and some subcontractors and “sales and marketing” might be one person plus an external agency but the overall concept remains the same.
Let’s face up to facts – like us, you’re in business to make money. Can you afford to waste development resources on a product that doesn’t give you a good return on your investment?
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