Monday, November 19, 2012

Eight factors to ensure New Product Success

The last 5 years, we are seeing a huge surge of software products, the sheer number of new products being introduced in last 5 years is greater than what was done in last 25 years!

The new technologies: Smart phones, Tablets, Social Networking, Green IT has created huge opportunities for software products and I have see a lots of new products failing in the market for varied reasons:
1. Bad timing or released prematurely
2. Not-enough resources to meet demand,
3. Bad user experience
4. Poor Marketing
5. Wrong Platforms and host of other reasons

This article is not about why products fail, instead I will talk about how to create a successful product. When we look at software products - there are eight key factors that must be executed flawlessly for success - getting the right balance of these 8 factors is the key & remember that there are no short cuts for product success.

Factor-1: Market Research: 

Start with Market research. Identify the product needs through extensive market research. Identify the potential customers, understand their real needs, estimate the volume shipments, identify the proper marketing communication channels to reach out to these customers. Interact with potential customers & users.

During this stage one must also research on the competition & supplier. Having a very good understanding of the supply chain is critical for any hardware products. Know the competition, understand what other competitive products that exist in the field and why those products fail to meet certain customer needs.

If you are a start-up, spend time to analyze your own capabilities to meet those needs

Factor-2: Design. 

Products is all about design. When you think about design, I urge you to think like Apple. Apple's design plays a BIG part in the product success. If you are designing a product, think about Apple, and ask yourself - "Will Apple use this design?"  "Will Apple design it like this?".

Think about all aspects of the design: Usability, Ergonomics, Aesthetics, Durability, Ease of learning, packaging, Cultural messaging, etc.  For physical products - design involves ease of manufacturing, shipping and handling.

Remember that the product design creates the first impression & it better be a good one!

E.g.: Sony PlayStation-PSP, Gmail etc.

Factor-3: Innovation.

All products must have some innovative features that will allow the product to stand out from competition and differentiate itself. Pricing is not valuable differentiative factor, especially in IT (software and hardware) sector.  Your new product must be different from all the competition & yet meet the end customer needs. Innovation is the key to product differentiation and product success.  Innovation can be in many forms: Functionality, Usability, Design, etc.

Avoid cosmetic innovation - i.e., innovation that adds little or no value to customer.

E.g.: Apple Siri, Kindle, Galaxy Note etc.

Factor-4: Product Name

Product manage is very important for success. If your product has a catchy name then consumers will advertise your product for you free via 'word of mouth' but if they can't  pronounce the name or remember it they will not talk about it. So take great care in choosing the name.

Remember Name is the brand, which leads to tangible value.

E.g.: Talking Tom, Farmville, Sims City, iTunes etc.

Factor-5: Quality.

Test the product extensively. Customers don't entertain product malfunctions, product recalls or frequent patches. In IT software/Hardware, one also has to test for product security.  Shipping out defective products - no matter how innovative it is will not please the customer. The products must be tested with actual customer usage and not just an assumed simulation use cases in the labs. Have a beta test program to test the product with customers.

In case of hardware, quality testing also involves testing the packaging, product shipping & handling - to ensure that the final product arrives at the customer's hand in the way it was intended. Extensive Testing is expected from all vendors. Today customers will not entertain defective product.

Remember that quality is not just about testing. Use only quality parts, deal with quality vendors, hire quality employees. In short quality must be ingrained within the entire organization.

Factor-6: Selling

Selling a product to the customer, the buying experience, plays a big part in the actual purchase process. For physical products, the retail experience in crucial. Today, selling is not just about handing over the goods and collecting money. Today, selling is about greeting the customer, educating the customer, answering customer questions, enabling the customer to use the product and finally solving customer's problem.

So selling involves selecting the right sales/distrubution channel, enabling the sales partners, educating the field sales force etc.

Here again, think like Apple. Apple does not launch a product and dump it into the dealers, Apple has made shopping a pleasurable experience.

Factor-7:  Customer Support

Customers are giving hard cash for the product and hence deserve a  commitment from the vendor to support the product. A good customer support will result in a long time commitment from consumers to the product.

Remember that customer support is not an after sales activity - it is actually a sales enabler. Today many customer call up the product support to check on the level & quality of support before buying a product.

Factor-8: Product Launch 

How a new product is launched in the market plays a vital role in the product success.  Product marketing is the name of the game. Knowing who your customers are and reaching out to them, enticing them to see, try and buy your product -  is when it actually becomes successful.

Product launch must be carefully planned and money has to be spent. Cutting back on product launch will surely kill a product, no matter how good, how innovative it is.

Closing Thoughts

Launching new products is like a ballet. Every move must be well coordinated and executed flawlessly. Here in this article, I have highlighted 8 critical factors that cannot be avoided. Entrepreneurs and product managers alike must find the right balance between these success factors to ensure the new products are successful .

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