When you’re first starting a business, you may have a small set of products—or even just one—to sell. But as your business grows and you work to boost your revenue growth, you may decide to launch a new product to increase sales and expand your customer base.
Launching new products is a natural progression for scaling businesses, but, according to the Harvard Business Review, there are over 300,000 new consumer products introduced to the market every year—the majority of which fail.
The same study also found that the majority of American families consistently buy the same products, meaning getting a new product on someone’s radar is extremely difficult. So how can you count yourself as one of the lucky few to successfully launch a new product?
These eight steps can serve as your new product launch formula to help ensure your product launch has positive results for your business.
Step 1: Find Your Audience
The first thing you need to do to prepare for a successful product launch is understand your target market. This will dictate how you promote your new product to potential customers. With so much competition, it’s especially important for small businesses to focus on a niche market. Here are some steps you can take to find your ideal audience:
- Examine your current customer base. This is easy if you’re already using a POS system. POS (or point of sale) software can help you analyze your current customers’ buying habits, by highlighting the popular times that purchases were made, which products sold the most, etc. This can help you replicate the success of previous product launches and improve on areas that need work.
- Do your research. Now that you know who is buying your products it’s important to understand why. Send a survey to past customers and ask them why they bought the product, what they like and dislike about it, or if there’s anything they would change. The easiest way to send out a survey is via email. There’s a slew of customer relationship management (CRM) software to choose from that can automatically send out these emails; some POS systems also offer a CRM function.
- Scope out the competition. Given the statistics mentioned above, chances are there’s a similar product to yours already on the market. Take a look at the past product launches of your competitors and ask yourself: Was it successful? What worked for them? How can I do it better?
Understanding your audience will enable you to devise your marketing strategy in terms of the language, channels, and overall look and feel of your marketing materials.
Step 2: Make Sure Your Product Has a Purpose
From the start, it’s essential to know what you want your product to achieve. Your new product should meet the needs of your target market or serve as a solution to their concerns.
Your customers need to know what they’re spending their money on. What’s in it for them? Why should they purchase your product? Once you’ve determined these answers, make sure you share this information with your potential customers in brief but straightforward messaging.
Step 3: Create a Roadmap for Your Product Launch
You’ve probably heard the saying, “If you fail to plan, you plan to fail.” This is particularly true when launching a new product.
There are a lot of moving parts you need to keep track of, so make sure you have a timeline for your product launch. This will serve as a guide throughout the entire process that will help you keep track of what needs to be done and when, such as requirements for suppliers or wholesalers and internal deadlines.
Now that your business is scaling, project management software is an important tool to help you stay on schedule. With apps like Airtable, Zapier, and Basecamp you can create custom records relating to your product launch and track them all in one place.
In an ever-evolving business landscape, you can expect a lot of bumps along the way. But with a comprehensive plan, you can face these challenges head-on and launch your new product on schedule.
Step 4: Set Clear Goals
This next step goes hand-in-hand with Step 3. Goal-setting is an integral part of any product launch. The key is to make your goals SMART—specific, measurable, attainable, realistic, and time-bound. Keep your goals in mind throughout the process to help you stay on track and use your time, energy, and resources in the most efficient way.
Step 5: Create a Demo
A good product demo can make or break your product launch, as it’s crucial to know what customers think of your product. It’s important to gather as much feedback as possible to make the necessary changes to your product. A good product demo should:
- Be unique to the customers you’re trying to reach—don’t make it generic.
- Tell the customer’s story through the product. It should be from their perspective as a buyer, not yours.
This will help you prepare for the actual product launch to ensure everything goes smoothly.
Step 6: Create Hype for Your Product
Virtually every industry faces steep competition—that’s why it’s essential to create buzz around your product and showcase what makes it unique. One way you can do this is by holding various events or activities, like a pre-launch party. Companies with big budgets tend to invite influencers and celebrities, and members of the press or bloggers. If budget is an issue, you can create hype for your product on social media. Here are some tips to keep in mind:
- Use branded hashtags. This will help create a unique conversation around your product.
- Produce short videos. A third of all online activity now consists of watching videos, according to Forbes. You don’t need to be Steven Spielberg to create quality videos either—websites like Animoto have several easy-to-follow templates.
Step 7: Gather Customer Feedback
It’s not enough to think you have a great product. It’s up to the customers to decide if your newest offering lives up to its promise. This is why getting feedback is an essential part of a successful product launch.
Knowing what your customers think about your new product will significantly help you in identifying areas that need improvement as well as the biggest pros to make sure you highlight in your marketing efforts. One of the easiest ways to gather feedback is through online surveys. Again, this is where good CRM software comes in handy, as it will save you a lot of time compared to sending emails manually. Here are some tips to keep in mind when writing a survey:
- Limit the number of questions. No one wants to fill out a long survey.
- Keep the questions short and easy to understand.
- Consider using multiple choice answers, or asking customers to rank their experience on a scale of one to five.
Step 8: Make Sure You Have the Right Insurance
Launching a new product also means reevaluating your commercial insurance plan. This may be the last thing on your mind, but remember that even one claim can cost you thousands, putting all your future projects on hold. The right insurance coverage is a safety net to protect your assets. Here are some of the policies to consider when launching a new product:
- Professional liability insurance: Do you give professional advice related to your new product? If yes, you may want to purchase professional liability insurance. This is to protect your business from financial losses in case there’s a mishap that impacts your customers.
- Errors and omissions insurance: As a business owner, there may be instances when you have an error while providing your services. With this policy, your business will be protected in case an individual or a company files a claim about an error in the services that you’ve provided.
- Product liability insurance: Product recalls make the headlines nearly every day. A recall could put a big dent not just in your wallet, but in your reputation as well. This policy covers the cost associated with tampering, contamination, and crisis management.
- Cyber liability insurance: Companies all over the world are in a constant battle against cyber-related incidents. Data breaches and identity theft are becoming increasingly prevalent, regardless of industry. But you can protect your business against significant financial losses due to cyber-related claims by buying cyber liability insurance.
Launching a new product can be daunting, but by following these eight steps it can prove to be rewarding for both you and your customers.