A large majority of new food products fail within the first year of launch. The reasons for this failure are many, but they are generally due to critical failures during the planning, development and launch phase of the product. Not to worry though, failures can be prevented if you are proactive.
Planning
It’s important that you take the necessary time to plan before moving ahead. It certainly prevent fruitless time, money and effort. At minimum you must determine and validate if there is a real need for the product and if your target market is big enough to make a launch worthwhile. This may include collecting data on consumer trends. Trending data will make it clear if now is the right time to introduce your new product.
As you reach out to your target market, you may consider organizing focus groups to discuss the product concept. This is typically done done face-to-face, but today social media forums may be an excellent way to reach out to targeted audiences and get feedback faster and cheaper. Just make sure that you are talking to the right people. Failure to hit the right target will make any feedback you get irrelevant. Make sure that you listen to feedback from your target group. Often we can get so excited about our idea, and become so blinded by our vision that we forget that ultimately it’s the customer’s opinions that will really matter.
Before you settle on the product concept, determine if the product is really new. Is it just a me-too item with very little differentiation with what already exists? If this is the case, costumers may not have a sufficient reason to shift to your product. Ideally, the new concept should address a genuine need that is not being satisfied, and your target market should care about the difference that your product makes. In other words, have a well-defined value proposition that describes why the product is necessary.
Having established what you want to make, and that you do have a sizable market and demand, you must determine if you have the resources to follow through. Some product spaces can be very expensive to break in, especially if it is dominated by major players who can afford to produce and distribute quantities at very low prices. Therefore consider if your investment capital is adequate to sustain potential losses say within the first 3 to 4 years. Also, determine if you have the necessary equipment, facilities, cross-functional expertise, competence, and internal management support that will be critical to sustain product quality and demand beyond the launch.
Development
In my previous blog, I described the process that you should follow when designing and developing a new product. I suggest that you stick to this process as a good guide. Don’t rush unnecessarily ahead too fast. We have the tendency to do this, especially when we have unrealistic expectations that the product will take off like a rocket and make a lot of money in a short time. Keep in ind that most successes are gradual rather than overnight. Why you follow the process, take the time to listen to feedback along the way. Never fall in love with the product. It will prevent you from seeing unwelcome truth even when it stares you in the face. Be prepared to stop and throw out bad ideas and start over again if needed. Corrections made sooner will minimize loss in the end. Ultimately you want to end up with a high quality product that is able to consistently deliver on its promises.
Launch
It’s important to plan for a strong product launch, including an effective and compelling advertising and marketing campaign. This means establishing the right pricing and product placement, as well as framing your presentation to appeal to your target market. Launching your new product may take a substantial budget. Don’t make the mistake of depleting the budget on the design and development phase alone, and then having nothing or too little left back for the launch. A great product that nobody knows about is worthless. You should plan to spend more on the launch if your new product is considered a revolutionary product, that is, it’s totally new to the market. Products of this nature will require a lot of public education. An example of this type of product would be a new and recently discovered root spice imported from the Amazon forest that has purported nutritional benefits.
A phased roll-out of your new product may be advantageous as you test the waters and collect feedback. For example, you may start in one region where the product is most likely to succeed, and then progressively introduce it in other locations. All the while, be keen to listen and collect feedback on sales performance and costumer satisfaction. Providing your customers an opportunity to submit feedback online using social media can be fast and efficient. It’s a great way to collect positive feedback validating your product. However bad reviews can kill your product before you have enough time to fix the problem, so thread cautiously.
