Marketing and sales are not rocket science, but successful product launches can be engineered and share some important common traits. It is important to identify and understand them because they will make the difference between an efficient launch and a mediocre one.
Let’s start with a blunt truth: more than half of the CPG products launched every year fail to make it to the market. Even worse, out of the 40% that does reach the consumers, only 60% generates some good revenue.
It is obvious, then, that the launch of a new product is an uphill task. Many things can go wrong along the way to success, from the market research and the conceptualization of the merchandise to the reaction of the customers.
But the good news is that the majority of successful products are built in a certain, replicable way.
The why: A successful product is created for a reason
All the products that populate supermarkets, bars and general shops’ shelves are there for a reason. They have a strong why, which can be related to a number of factors.
First, the product is launched because there is a gap to fill, that is, there is an opportunity. Such a product will enter the market to occupy a spot nobody – or almost nobody – is holding. For example, the Highball ready-to-drink cocktails by The Original Free Drinks Company – the line is claimed to be the first of its kind in the UK.
Second, there’s a clear need to be met with a specific product. Here, the challenge is spotting the need in its early stages before it becomes a full-fledged trend. To do so, companies are relying more and more on data, because changes within a specific market can be spotted only having a clear and continuous view over it.
We tackled the topic in our latest blog, where we talked about trade marketing strategies and how data can help with them.
The who: A successful product is built paying attention to the customer
Customer is king. This statement has never been more true, especially now that we are in an age of rapidly-shifting hypes and customers have more and more nuanced tastes.
The who of a product is tightly related to its why, but what matters here is understanding the customer. This means, first, having a clear view of which audience will welcome your new drink, dish, perfume or whatever you want to launch; second, it means keeping in mind that the personalization of the experience is an increasingly important factor.
The first point, selecting the right audience, is segmentation. Simply speaking, nothing is built for everyone. There are many ways to group audiences but again, as said earlier, a data-driven approach can help. Many examples of market segmentation can be found, but the best way to go is to build an in-house distinction having access to data about distribution, trends, and tastes within different geographies.
The second point instead is about personalisation. Shopper and trade marketers know it well: users want to be pleased in every step of their purchase journey, and a new product needs to meet clients, giving them the impression of having been created just for them.
Moreover, as the Harvard Business Review reports, customers are creatures of habit. 85% of them always buy the same 150 items. It’s really difficult to break their habits and convince them to try something new.
The when: The product is launched at the right moment
It is no use to have a well-made product, built for a reason and for the right audience if the launch happens at the wrong time.
The keyword here is trend analysis; collecting information and attempting to spot a pattern. The market has to be monitored continuously to understand what will happen based on what just happened.
For example, if you spot a new market trend in the beverage industry, regarding a certain cocktail being popular in NYC or London, it will probably be a matter of time before it becomes popular worldwide.
The where: Successful products are launched in the right place
The pitfalls of the when apply to the where as well. You launch an amazing product, for the right customer, at the right time, but what’s wrong is the place.
How does a company make sure its new product is being presented in the right area? A thorough geographical study is needed to gather the right intelligence. A brand needs to be well-equipped with information on previous tests, launches – also failed ones – and, again, on the competitors’ choices.
This is an operation we help several companies with. Data-driven location intelligence is of utmost importance to be in control of a market. Think about product launches by Coca Cola: the Food & Beverage market is highly competitive and definitely subject to fads and hypes, so the best way to move into it is tackling it like a Risk game.
You explore your market with clear geographical info. Then you make it yours, making the right decisions, and rolling the dice when you know you will win.