Developing and marketing a product, requires a lot of planning. You need a vision for your product. Whether you are a start-up company or a product manager launching a new product, there is a lot of research that has to take place. Your budget will dictate the size of your marketing campaign. However, you are in control on how to allocate that budget. I touched on some of the questions that should be asked in a previous post. I will focus on them in more detail. The research should focus on the following:
- What is the product designed to do?
You will need to be able to answer this question in writing (product literature) through creating and implementing product demonstrations that tell a story. This story should demonstrate a need that is not currently being met. Once this need is identified, it is your job to show how people will benefit by using your product. If your product is an improvement on an existing application, you should demonstrate how they can get a task done quicker, with less effort and with results that are better or at least the same to the current product. (Your product should be patented or in the process of being patented before showing it to the public if applicable.)
- What are the demographics of the people using the product?
In other words, who is your target market? Who could benefit from your product? What motivates them to buy? How is this group prone to spend their disposable income? How have they made purchases in the past with a similar product if you are new to the market? Traditional e-commerce etc… How do they interact with brands? You will need to answer these questions in order to develop a successful campaign.
- How long is the sales cycle between purchases?
I would examine your sales data on a similar product if possible. If your product is a completely new category you will not be able to do this.
- What channels is the product sold through?
If your product is a completely new invention you will need to decide on how you will market it. Are you going to hire a direct sales force to sell it directly to consumers? Are you going to call on distributors and retailers to get them to sell it to the end users? Are you going to use e-commerce as the main way you sell your product? Are you going to advertise on TV? Social Media? Trade shows? This strategy will need to be determined based on the demographics of your target market that I mentioned above. (Once you begin your campaign, sales data from each one of these channels need to be studied to see which channels are the most effective. This data can be used to make adjustments in the campaign.)
- What offerings does the competition have?
How do your offerings measure up compared to the competitions? In other words, is your product better than competition? Where is it weaker?
So where could you find this information? (This applies only if your product is an improvement on an existing application.)
- Product literature from your company and the competition
- Reading industry trade magazines and journals
- Attending industry trade shows where products are readily on display
- Viewing product training and demonstration videos by experts in your field
- Talking to prospects and existing customers about how they use the products
If your product is completely new, you will have to create and organize focus groups. These groups should be made up of people who fit the demographics of your target market. I would try to target influencers as well, letting them try the product for free to see what they think. Then I would take this data, analyze it and make improvements. (Depending on your offerings an engineering team may need to be involved in the process.)
You now need to decide on how to price your product. If your product is an upgrade on an existing product, you can look at price points of competitors and your sales data to set a price. If your product is new, you need to calculate your margin, specifically the cost per unit to determine what is the minimum price needed to sell your product at make a profit. The next step is to figure out how much profit you want to make versus how much you can make. This information can help you to decide at which price range to price your product. Next you need to test out your product at different price points in test markets to see at what price the product sells the most.
Once you have done all of this, your product is ready to be sold to your target market.
This is how to develop and market a product in a nutshell.
Until next time, thank you for reading.