7 Reasons Why A Great Product Launch Can Fail and How To Avoid It
by Juliann Grant, Global Strategy and Analyst Relations, Telesian Technology Inc.
It’s reported that 70% of all new product launches fail in the first year. The question is, why do some succeed when others fail? Having seen both sides of the product launch picture, here are a few pitfalls to watch out for:
1. The market does not “need” your offering.
Some product launches are steeped in a philosophy called “If I build it, they will come.” Many start-ups find themselves building a market solution that is based on one or two customer experiences. The reality is…without the proper market research, even the best launch plans can fail. To avoid this mistake, adequate research needs to be completed to ensure that your go-to-market plan is based on facts and substance. It’s imperative that you validate there is a market out there. Does the market have a business need? Who are your best customers? Are there enough to sustain growth? How does this solution tie into the bigger growth picture for a business?
The good news is, if you do not have all the answers, you still have time to get them. It could save your launch millions.
2. Sales training/enablement was ineffective.
A key element in a product launch is training and enabling the channel to sell the new product or service. Sales training/enablement means that your company has carefully considered what information will be communicated: (1) to the sales channel so they can effectively sell the new product or service, and (2) to your prospects and customers so they can make an intelligent buying decision. This requires taking a look at the sales cycle and making judgments about what the field will need to know and what they will be able to deliver to a prospect or customer.
3. Message/value proposition did not create urgency.
We recently published a series of articles that discussed the success or failure of marketing programs. In this series, we looked at how messages either create an urgency to act toward something – whether it is to learn more, request an offer – or do the opposite…nothing.
When looking at messages in the context of a product launch, the same guidelines apply. Your messages must help a prospect or customer understand the following:
- What makes your product or service different in the market? Have you highlighted those facts/features in your launch?
- How does this compare with the competition in terms of pricing, messages, and models?
- Is your solution/service aligned to help solve a business problem in your market? If not, then your solution becomes a “nice to have” vs. a “must have now.”
- Are messages aligned to who actually purchases this product/service? Look at the functional titles – who are you selling to and are you speaking a language they understand?
4. Launch did not plant enough seeds.
I often compare the role of marketing to that of planting a garden. The fruits that you enjoy after you’ve done the work come in the form of new sales. However, we all know that fruit just does not simply appear out of nowhere. It takes months to develop, and only after planting good seeds and frequent watering. Marketing a new product or service requires much the same model. If you are entering a new market with something spectacular and the market doesn’t know you or your solution, then you have some serious planting (telling the world what it is you are doing) and watering (creating urgency) ahead. If you are already established in a market and are coming out with something new and exciting, then you may not need as many seeds, but be prepared to plant and water anyway.
Setting the stage in your market requires mapping out what a prospect or customer will need to know and understand when making a purchasing decision for your type of product or service. Do not assume that your market will draw the same conclusion you are ticipating. Your launch strategy and execution must reflect a clear understanding and path that helps a prospect or customer make intelligent decisions, create an urgency that they really need what you are selling, and provide guidance on what they should be doing/thinking about next.
5. No BETA customers or references were available.
This obstacle tends to surface well into the launch plan. What happens here is this… All launch plans are a “GO”… You have seeded the market and they responded in kind. The channel knows what they are selling and are doing a good job of it. Sales cycles are in process. And then BOOM…someone wants to talk to a reference. Now what? Are you prepared for handling this sales obstacle?
Many product launches have overcome this obstacle. Your references don’t need to be perfect, but you need a plan to address this stage. The good news is that if you’ve gotten this far, your launch is probably working. Now, you need to button up this latter stage so you can turn these opportunities into sales.
References fall under two categories: (1) the ideal reference who served as a BETA customer during product development and can speak to your vision, the product, and working with your organization, and (2) the not-so-ideal reference who is using a different (or older version) product/service by your company. Both have fantastic validation points and will serve you well. Just know what each reference is offering and explain to the channel how to get the most out of the references you have lined up. Do not leave this to chance or assume the channel knows how to use the reference.
Also beware of reference burnout. Try to spread the wealth and have different references lined up to address specific issues. If, in the end, you do not have a reference prepared, then you may want to offer one of the first, really interested prospects a sweet deal to help you with the rest of the launch.
6. The company did not fully commit to the product.
This issue will also come up during the sales cycle because your sales message is not tight. If your company is throwing development dollars at fixing a “hole” in an older product line, and has not shared a larger vision of where this product is going in the future, you will run into issues. Your channel’s credibility is on the line, as well as your company as a whole. Make sure you have taken the time to prepare answers to the questions that will come up:
- What is the long term plan for this product line?
- How does it fit in with your other products/services?
- What is the planned upgrade/release schedule? How frequent?
- Where was this product developed (be prepared to address off-shore issues and concerns)?
7. The sale of this product/service eroded other revenue generation opportunities.
This is an issue that I have seen come up more than once as this side of the launch is often not thought through sufficiently. The issue focuses on the “cost” of the launch to the usiness – and deserves your attention. It is not as much an issue for new sales as it is for your existing customer base that has already made investments with your company. The questions you must answer to avoid “surprises” include:
- How does the sale of this new product impact our other product lines?
- Do we have a clear upgrade/migration path for current customers?
- What is their benefit to upgrading systems or migrating to a new platform?
- What is the cost of conversion for each of these deals to our business? (long term and short term)
If you have successfully uncovered each of these issues, then you have dramatically increased your chances of a successful launch. Being part of a successful launch is one of he most exhilarating and rewarding experiences as a marketer. Always remember to take the time to reflect on how your product launch is performing so you can learn as you go. I recently heard a great phrase, “An error only becomes a mistake when you do it more than once.” So, here’s to your success!
Juliann Grant is Manager of Global Strategy & Analyst Relations at Telesian Technology, a marketing and web development firm specializing in the industrial and manufacturing markets. She can be reached at firstname.lastname@example.org