Launching a New Product

If you are starting out on the journey of a new product launch we would like you to know that it is only slightly more complicated than the federal tax regulations and perfecting cold fusion? So it can be done!!! Over the years we have been involved in hundreds of new product launches and it is very different than promoting an established company, product or service. Large businesses launch new products by throwing large stacks of cash at the problem and that works. For a smaller business, that is not an option and that is typically the types of projects we have been involved with. Over the years we have seen success, failure, and the walking dead and there is a pattern to these results. This article is about the small business way of launching a product.

This article assumes that the reader is a small, medium, or startup business and that the product already exists. To put this into my terms you are “All-in” and have “Already drank the Kool-Aid.” You are committed and ready to pull the trigger going to market. Before this point you already wrestled with the issues of product features and benefits as well as the ideal customer. It is now time for the market to speak and for you to listen.

Creating Your Marketing Eco-System

Launching a new product is about creating a marketing eco-system to support the product over its life. This means that you have to consider and work all the reasonable channels including rep sales, phone, email, direct mail, blogs, distributors, retailers, and e-commerce. This requires a plan that considers SEO, PPC, PR, and direct sales. If the question in your head is what is the best or right channel to work in you do not yet understand the challenge.

Marketing Is A Full Contact Blood Sport

Marketing a product is a multiple contact process and while the numbers will vary from expert to expert I suspect this is north of 20. This means that on average you will put your product in front of an audience 20 times before they buy the product. In the lexicon of the web this can at times be an impression but more likely it is a click and page visit. There is a problem here that causes clients to not understand this process and it is early success. They run some advertising or some other activity and they get an instant gratification sale and they want the market to continue to do that… they are almost always disappointed. If it takes on average 20 impressions to drive a sale, then individual sales will have everything from 1 to 40. Normally this will be a bell curve distribution with a peak at 20 or whatever that number is for your product. There is no doubt that marketing requires contact with the market and it is a brutal place that will make you stronger.

Free, Fast, and Easy

One issue that almost always comes up is the client will want to do an SEO only strategy and their reason is easy to understand. They think SEO is free, fast, and easy. The problem is that it is none of these things. SEO is the digital equivalent of PR in the physical world and it is great when you can get it, but it is highly competitive. SEO is often the most expensive channel when you consider the labor costs that go into this activity. The problem is that this cost is often hidden from the decision makers – not on purpose but by practice.

If the Idea Is New Then Nobody Is Looking For It

Many new products are innovations and as such, nobody is looking for them. By definition this means that search placements are not going to work. On the PPC side of the strategy this means moving more budget to the display network and working with image ads rather than text. While you can get some traffic from text ads you can create a lot more demand impressions from image. If a product requires substantial consumer education you have to consider the cost of educating the market. Trust me when I tell you that educating the masses is a lot of money.

Early Adopters

When launching a new product you have to accept the fact that you are first selling to early adopters and this audience thinks and acts differently. Most studies show that we are dealing with about 13% of the market when we sell to early adopters and this means that 87% of the market is not going to be interested. As product travels through its life cycle this will change and so will your messaging and targeting. In the launch get into the head of the early adopter and stay there to make sure your message fits this audience profile.

Social Media

Social Media is right up there with SEO in many conversations and for the same reasons. The problem is that many businesses get this wrong because they have their eyes on the prize rather than on the market. People do business with those that they like and they like those that help them understand – they do not like people that sell to them. Social media needs to be established well in advance and your first mission is to have something meaningful for your social group. The beginners mistake they make is they run into the network screaming at the top of their lungs about a product nobody cares about and then they wonder why it did not work. You need to engage your audience and you have to show that you have multiple and interesting facets to your profile.

It’s About Distribution

Launching a new product at scale normally means getting the product into physical or virtual shelf space and that is in direct competition with and conflict with your direct e-commerce. Businesses often want to sell the product direct because the margin is better. Then they run into resistance from the retailer with whom they are competing with. This is one of the natural conflicts that product launches have to wrestle with. Retailers like new products but they hate new competitors and they are especially hostile to competitors that they feel have an unfair cost advantage. If you are the manufacturer and you want others to distribute your product you have to be disciplined about your pricing and you need to support your retailers. This can mean losing sales that you could have done directly.

Everyone Is My Customer

If you believe this then you either hold the exclusive rights to oxygen distribution or you are crazy. To market a product you have to decide who your audience is and then speak to them. Only rookies think their product applies to everyone with one message. The more precise you can be with the audience profile the better your marketing can be targeted and the more likely you will get the result you are after.

Some People Get Lucky

Marketing is complicated because it is where people, ideas, and resources come together and sometimes people get lucky. A statement like Apple did this or Google did that does not mean that you can replicate their success. Certainly we can all learn from thought leaders like this but ultimately you have to create your own luck.

Paying for the Launch With The Profits of the Sales

I hate to be the voice of reason but this almost never works because early stage sales are rarely profitable. Let’s face the reality that marketing is legalized gambling and that new product launches are the big table. You need to go to the game prepared to fund a minimum market test, which normally is at least 3-4 months. Things are going to go wrong and you are going to need to adjust to the realities that the market delivers. You want $20 conversions but your competitors make them $40 and now you are losing money on every sale. Competitors are not going to make this easy to do.

Stay Flexible

There is one thing that you can depend on with a new product launch. It will be difficult and it will surprise you. You have to be ready to listen to the market and pivot quickly while staying true to your purpose in the market. If you engaged the audience during the product development you should be partially on-target but the reality is that you probably asked the wrong question. You asked “Do you like this?” The series of questions should be “Would you buy this?” followed immediately with “Can I have your credit card to secure your advance order?”

There Is So Much More

There is not one way to do this and what you want is to have a smart and creative team around your launch that is listening carefully and responding. This is just like a chess game in that everyone has the same tools but the game can evolve in many different ways.

A big thank you for a great photo from NASA!