Launch

The next step of the new-product-development process, launch, results in the introduction of the product into the market. Decisions need to be made about timing (when to launch the product), geographic strategy, target market prospects, sales and customer service support, and final marketing strategy.

 

Timing can be a critical component of new-product success. If competitors might be (or are) entering the market, the product manager must decide whether to get there first, concurrently, or after the competition.

First entry usually provides an advantage, but if rushing results
in a flawed product, the result can be more damaging than good. Timing

an entry with competition can neutralize the competitor’s potential
first-mover advantage as well as possibly increase the potential market faster. Delaying an entry until after competition is in the market might make it possible to capitalize on competitive flaws as well as benefit from any competitive advertising that educates the market. Timing is also important if there are seasonal or cyclical aspects to a product, or if the introduction impacts the sales of existing products.

 

It is also necessary to make decisions on a geographic strategy. On
some occasions, a national launch is appropriate, but most new products start with a roll-out strategy. Prioritize the markets (e.g., regions, industries, or countries) and decide on an entry sequence.

For example, it might be desirable to first enter the most attractive markets in terms of size and dollar potential. Or it might be more desirable to enter markets where competition is weak, providing an ability to gain experience, exposure, and market position. In other situations, the selection of roll-out markets is based on different product applications, pipeline inventory in the markets, ability to gain distributor or retailer support, company reputation in the market, or a host of other factors.

 

Although the roll-out might appear similar to test marketing, it differs in a couple of important ways. First, in a test market the product manager targets regions that are representative of the final launch. This is not the case with a roll-out. The markets are selected based on their ability to provide an early cash flow or to gain commitment from an influential market needed for the continued roll-out. Second, the test market is a final test before the commercialization decision is made. The roll-out is the first step in commercialization after the decision is made.

As part of this geographic strategy, identify specific target market
prospects. This is particularly important in the business-to-business
market where clients/prospects can be listed by name. The more detail that can be provided here for the sales force, the greater the chances of encouraging them to sell the new product.

That leads right into sales support. Work closely with the sales force to provide them with information that will help them sell. Prepare “how to sell it” booklets that discuss customers (not target markets), applications (not features), and useful questions to ask on a sales call. Make sure that customer service stays in the loop with sufficient communication through internal newsletters, informal and formal meetings, and various announcements.

The last part is fine-tuning of the introductory marketing strategy.
This action plan details introductory pricing, base price, and option
pricing; press releases and product announcements; direct mail to select customers; shipping policies and procedures; channel and end-user communications; and training for the sales force and/or customers.

The sales training in particular should help salespeople sell the product rather than simply pitch the product.

The sales training that is part of the product launch should educate
and motivate the salespeople to sell your product. In other words, why should the salespeople believe the product will perform as claimed?

What motivation is there for them to sell it? For an existing product,
the best proof is past sales success. For new products, a bit more persuasion is necessary. Results from test marketing or beta testing, statements from sales managers or other salespeople indicating their success in a roll-out region, sales that you (as product manager) have personally made, or trade shows and lead generation programs in place can convince salespeople that the product is worth their time and effort to pursue. In addition, financial and nonfinancial motivators should be considered. Higher commissions, better bonuses, and desirable contests can work under the right circumstances.

Nonfinancial motivators could include customer input suggesting that less sales effort is necessary to be successful, the ability to sell the product along with another product with a minimal increase in selling time, or unquestionable proof of competitive superiority.
A portion of the training might also include a motivational explanation of the need for and use of market intelligence by product managers, and how providing this information can help the salespeople. A standard intelligence report form can be built into a call report, designed into the menu system on a computer, or included as part of the expense form. Because this information typically comes into sales management or sales administration, a process would need to be established to send a copy of relevant product-related data to the appropriate product manager.

• The type of information useful for submission might include the following:
  • New-product announcements by competitors
  • Effective and ineffective approaches to selling a product
  • Changes in competitive strategies
  • Unusual product applications by customers, especially if
  they indicate a trend
  • Perspectives on market trends that might affect company
  strategy
  

 

Project Evaluation

After (or during) the launch stage, some type of project appraisal should be completed. The main objectives of this stage are to improve future product development efforts and to move the product from a new product status to being an ongoing product requiring long-term maintenance.

There may also be a need on occasion to relaunch a product
that is not meeting expectations. The relaunch should be considered as early as possible, and hopefully will have been uncovered by the early indicators as discussed in the prelaunch section of this chapter. If the product is still an acceptable product, changes to the marketing strategy may need to be made to make it a success.