According to multiple sources, 80-90% of the estimated 30,000 new products launched in the United States each year will fail. This statistic is not meant to be discouraging, in fact, with the right perspective, it’s meant to help identify the pitfalls innovators face so you can focus on avoiding them and become one of the 10-20% percent of new products that succeed.
Research published in the Harvard Business Review states that the number one reason products fail to meet expectations at launch is lack of preparation. All new products, even before they hit idea stage, face a significant uphill market battle. According to consultant Jack Trout, most consumers tend to habitually buy the same 150 products that meet their regular needs. With this kind of established behavior and psychological groove, it’s difficult to get any new products into the decision set, regardless of how good they are.
The key to overcoming this challenge is casting your new product as a solution to a problem. We humans instinctively respond to things that make our lives easier, more efficient, or in short, make our problems go away. But let’s look beyond established consumer behavior and take a look at common mistakes made during product development that can undermine success.
Lack of Preparation During Development
There are several layers of risks that exist within the concept of lack of preparation. Not the least of which is caused by companies, both new and established, that get stuck in the product development process and postpone the creation of a marketing plan.
A clear, executable plan is imperative to success and delaying, or neglecting to complete this task will severely diminish your chances of success. Clearly communicating the value of a new product is an enormous part of a product’s success story. Preparation goes a long way, but there are still more challenges to overcome that can and should be addressed during development.
Is Your Product Revolutionary?
Too many innovators get stuck on the idea that their new product is “revolutionary,” but fail to complete the proper testing to ensure that is true. Anecdotal evidence can be alluring, but it is only after prototypes are built and testing begins that you start to really challenge whether an idea has legs or not. Turn your idea into an actual product that people can hold and use, and you’ll start to see where the opportunities lie.
Education
Sometimes, when a new product defines, or is attempting to define, a new category, it requires significant customer education to understand how great it is. That educational requirement can be a significant hurdle to adoption. If your consumers don’t understand immediately that your product makes their life better, you run the risk of being ignored.
Less-Than
Many times, product developers are so excited about what they are creating, they may begin to make unrealistic claims. “My product can do this, can save this much time, and can deliver massive return on investment.” These are all tremendously good ideas, but only if they match up to the reality.
When a product fails to meet consumer expectation, you put yourself in a very difficult spot. It is imperative to know exactly what a product can and can’t do before introducing it to the market. Up-Rev, for example, implements a systems approach in this phase of development that helps solve these issues before going to market.
Is the Market Ready?
Remember “Ginger” from inventor Dean Kamen? The idea went to market a year before the product and generated tremendous interest, claiming it would be no less than a replacement for the automobile. When it was released, and re-branded as the Segway, it was nothing short of an engineering marvel. A new way of moving about the world and a total rethinking of e-mobility. Unfortunately, it mostly fell flat. The demand and problem it solved were not as clearly defined as they needed to be. Early adopters and gadget freaks loved it, but there was no truly mature market for the product.
Growth Strategy
So, what if your product is a hit? Your product solves a real problem for people and they can’t get enough of it. American Biophysics developed its Mosquito Magnet in 2000 during the West Nile Virus scare, using carbon dioxide to lure the flying pests into a trap. It quickly became one of the best-selling products at Home Depot.
Suddenly, the perception is that you have to move from your small, domestic manufacturing facility to meet market demand. With facilities around the world, factors like quality control, delivery time, supply chain issues, communication across time zone, and other unforeseen circumstances become real obstacles. The truth is, there are exceptional supply chain partners available and many options to scale, both domestically and internationally, that can solve all of these problems. Up-Rev has numerous relationships that make all of this not only possible, but a regular, strategic method.
In the case of American Biophysics, customers became unhappy and the company went from $70MM in annual revenue to a sale of the company whole cloth for just $6MM. A cautionary tale to be sure, but with the right preparation, the challenge is not insurmountable.
There are numerous other challenges facing even the best new product ideas out there. But with the proper guidance and help from experienced consultants like Up-Rev, you can start to optimize your path to success.
