Launching a new product - All the best!

Nine out of ten new products fail. A sobering, if not chilling statistic. And yet, new product launches are necessary and inevitable if a company is to grow. Successful new product launches bring revenues to the balance sheets of companies, smiles on the faces of investors and editorial spaces from the admiring media. But before we get ready to count the cash and smell the roses, lets look at why the success rate of new products is so low.

Most of the new products are me-too:

Sometimes, people in marketing are too close to their products. They spend so much time with their products that they get very attached to them and hence they cannot be really objective about them. Every small improvement seems like a breakthrough. Customers, on the other hand, tend to be quite matter-of-fact about new products in the best of times. So, it does not seem dramatically different from what is already available in the market. They are hardly going to make out the difference and buy it. Never over-estimate the importance of the product in the consumers’ life.

Are you underestimating the competition?

Very often, companies tend to underestimate the competition. Companies have become big by being paranoid about protecting themselves and their market share. The competition will throw the kitchen sink at you, offer their products with a price-off, bad mouth you and twist the trade. Many companies by their actions and words will make Glen McGrath and Jason Gillespie look like absolute gentlemen.

Have you studied your competition? Are you selling a concept or a product?

Sometimes companies sell concepts under the garb of products. Concept selling takes time, effort and money. Consumers are slow to change. They are creatures of habit. They act in a certain way because they have been conditioned to act in that manner. To expect a quick speedy change in their behavior can be risky.

Is the product positioned correctly?

Today we live in a crowded, cluttered and competitive world. To be successful, a product must stand out. Has it been positioned correctly?

Have you used Public Relations?

Companies often are always driven by advertising because it not only works but it also is manageable and controllable. Public Relations is more difficult but it costs a fraction of advertising. Are you missing a bet?

No, I am not trying to paint a picture of gloom and doom. Success in new products can often be dramatic like the TVS Victor. But the success is anchored in a strong product. Remember that product performance is the key. Get a good product first. Plan the launch. Be prepared to wait and to spend and it also does not harm to pray a bit!

Ramanujam Sridhar is CEO, brand-comm, a leading brand consulting, public relations and advertising. Contact:25539369/25539258. Mail at
sridhar@brand-comm.com

Issue BG35 Feb04