Whether your business is a new contender in the startup world or run by a veteran entrepreneur, marketing and launching a new product is challenging. 70% of product launches collapse within the first year. With such a high risk of failure, every possible angle must be explored to ensure a successful launch.
Lisa Shepherd, founder of The Mezzanine Group, says most people gravitate toward the sexier aspects of new products such as “launch and growth,” but that the most successful product launches always start with a great deal of pre-launch preparation. The road to success begins with in-depth market research and testing.
Shepard recommends working on messaging and positioning right away. “Nothing is more powerful than figuring out the key benefit of your product and building your marketing strategy around that. If you can ‘nail’ your pitch and really hit a market need, it will be much easier to promote your product, get early sales, and then grow from there,” she says.
David Poulos, director of marketing for Pinnacle Advisory Group, says strategy must begin with positioning the product into the right marketplace to capture the consumer’s attention.
“You always start with research, and there are many different points of attack for this,” he says. “There are focus groups of potential customers that must be created, customer profiles done, and devising a way to present the product in a variety of different incarnations for various market segments and environments.”
A great place to start is with a market requirements document (MRD).
“An MRD will help you pinpoint the customer need for your products so you can define your target market and create buyer profiles,” says Poulos. George Schildge, CEO of Matrix Marketing Group, would agree. “This document will also help you identify the competitors in your industry. Overall, the MRD will help you build a business case for your product that you can then begin to share with potential investors,” he notes.
After proving a product’s market appeal, it’s time to develop a product requirements document (PRD). Schildge explains that while the term PRD is often used interchangeably with the term MRD, they are actually quite different.
“The market requirement document should define whether or not there is a business opportunity for your product, while the PRD is an exhaustive document that outlines the ins and outs of the actual product,” he says.
Another pre-launch step involves researching the competition and finding key differentiators on which specific problem, deficiency, or dilemma the product solves or fixes.
“If you’re preparing a launch, internal data isn’t the only data you can leverage to optimize your marketing strategy. You should research competitors who have already launched in the same space and try to learn from their successes and failures,” says Termeh Mazhari, a marketing and SEO consultant based in Manhattan. “Observing and gaining insights from a competitor’s launch strategy is a great way to prepare your own launch.”
To differentiate your product, Poulos suggests that if everyone else’s package is branded with the color green to imply “natural” or “organic,” counter-position yours with black design to signal “industrial” or “super strong”—something that’s unique to your offering.
Shepherd notes it’s also important to set a budget and result goals. A good benchmark for B2B is to spend 5% of their year-five sales goals on the product launch.
“So if a company wants $10 million in sales in year 5, they should spend $500,000 launching the product,” she says. “This varies by industry, but is a good starting point for people who aren’t sure what they should expect to spend.”
Spreading the Word
Aiming for success means getting the word out by any means necessary. This includes building a website and sharing news about your product on social media to build up interest and awareness.
Connor MacDonald of Top Hat Ventures says building and leveraging an audience with pre-launch incentives is vital to success. For interacting with potential customers, he suggests utilizing email marketing.
“It’s still one of the best sources for leads and sales, and just because your product hasn’t launched yet doesn’t mean you can’t start collecting emails from prospective clients/customers,” he says. “Collecting emails pre-launch is essential and, as the launch approaches, setting up a system to incentivize and reward people for sharing can be effective.”
Other ways to garner pre-launch buzz is to get some stories in print, either by buying booths at events or sponsoring charitable endeavors. You might also deploy targeted banner ads and run a strong visual media campaign on social platforms, or a comprehensive influencer set targeting a specific demographic.
Testing the Waters
Once the product developers have created a product, testing it with beta testers and focus groups sheds insight on how customers will react to it.
“When you have test results, you’ll have a better idea of who is going to connect with your product and you can use testers’ quotes in customer testimonials if needed,” Schildge says. “It’s important to remember that your product doesn’t have to be perfect before releasing it to beta testers. Give them a prototype with basic features and obtain regular feedback from your users. This will help you identify what matters most to your consumers, so you can spend most of your time developing the important features that will help to grow your products’ popularity.”
Gather feedback on the product’s name, people’s experience with it, any gaps in the offering, etc. Before going live, it’s essential to understand the end users’ experience and optimize your product in iterations.
Ideally, brands should identify three or four different marketing channels for testing purposes.
“Do small tests on those channels to see if they are profitable. See which marketing channels resulted in a positive ROI. Increase your spending on channels that worked and stop all spending on ones that didn’t result in new customers,” Nishank Khanna, CMO of Clarify Capital said.
A product launch is often seen as the culmination of the product development process, but that’s absolutely the wrong approach, said Linda J. Popky, President of Leverage2Market Associates, Inc. “A product launch team should know in advance what they want to achieve from this launch, where they intend to go, and how they will get there. This means all the key elements of marketing strategy—understanding the target market, mapping the competition, identifying the appropriate sales channels, developing the correct pricing and packaging to reach the market, and crafting the right message to be delivered—should all be in place long before the final launch countdown.”
Remember to record everything. The only way to determine which aspects of a marketing strategy are effective is by documenting everything you’ve tried, along with the resulting metrics. Not only will this strategy increase efficiency and revenue, but it will also benefit future endeavors and help define your brand strategy.