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Marketing New Products
Every product has its life span that passes through 4 phases: Development, Expansion, Harvesting and Decline. The goal of every product owner is to build successful product that will succeed in the market. So what is the road to success for a new product?
Successful product will be the one that have a good performance through its life cycle. Development is the first stage of the product life span. The design of the product need to give product that will satisfy consumer needs, that will be economical to be produced and it will be sold in a quantity sufficient to fulfill the goals of the product owner.
During the Development Stage, the product is designed based on different surveys and assumptions. These inputs are based on population mix, economical environment, consumer habits, trends, competition, etc. Still, Development stage cannot guarantee that the product will succeed in the market.
The success of the product will come in second two phases of the product life cycle: Expansion and the Harvesting. In order to have successful performance during these two phases, the product need to have gradual and planned sustainable expansion in the market. The product needs to build its Footprint in the market.
Building of the market footprint for the product is the process that requires activities in different segments. During this process all functions within the company have some role: Development, Marketing, Production, Logistics, Sales, ... Building a successful footprint can be done in several different, but interlinked dimension.
Geographical expansion can be planned by stages or immediate expansions to all geographical regions within a certain market. The approach depends of the strategy and logistic capacities.
Numerical Distribution ( ND ) shows percentage of covered outlets within a certain geographical market. Since ND requires resources and time, strategic approach is needed during the planning of expansion. Planning need to give an optimal approach that will give the best results with balanced resources required.
Population targeting. Since every product has its own main targeting area, marketing plan should be done accordingly. Proper population targeting will give the best results, since broad approach requires more resources than potential sales.
Presentation is a way of arranging and merchandising the product in the retail outlet. The good presentation can give a competitive advantage in the outlet, since the consumer might choose the product that is perceived as one that gives the best value for money. Presentation is increasing the value and brand equity in the eyes of the consumer.
Consumption occasions can be different. For example, you can consume a soft drink at your home, at work, during sport, etc. Occasions are many. Through subtle marketing approach, the owner of the brand can build new habits of consuming a product. The new consumption occasions are leading to potential increase of the sales volume.
Differentiation from competitors can help in expansion of the product market footprint, since differentiation can be decisive factor that will turn the choice of the consumer to buy your instead of competitive product.
New packs, innovations in design and special offers are drivers of the consumer interest as well as the generator of sales. A new pack or innovative design can bring to additional purchases and can build a new consumption occasion.
Value adding is important aspect of market footprint building. Low price is giving the low revenue and profit for the producer. On the other hand, high price can distract the potential shoppers. The value adding to the product can span this gap. If you add value to the product through quality, marketing approach, satisfaction of customers, excitement, image, etc. you make your product more valuable in the eyes of the shoppers. Product value makes the shopper to buy more expensive product, if that product is perceived to have a good value for money offer.
Building loyalty takes time and a lot of effort. But once built, loyalty will make your shoppers trust to you. Customers trust gives you a chance to exploit other opportunities for a new product, categories or consumption occasions that will continue your sales growth.
So, there are many tools to expand your footprint in the market. A good mix and usage of these tools can give you the result that is your picture of success. A good market footprint will make that the curve of product life cycle will last and last for a long time.
Laurus Nobilis has 11 years of experience in FMCG business. In 2007 he has started the http://www.biz-development.com web site dedicated to development of managerial skills. He also runs http://www.my-introspective.com a Personal Exploration and Development Guide.
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