After managing and participating in so many product launches throughout my career, I’ve come to realize that most new product launches fall short of management’s original expectations.
After thinking about the most successful launches I’ve been involved in (which generated tens of millions in early sales and went on to generate billions in sales over a couple of years) vs. the biggest launch failures, I realized some things…
Whether launching a new product or a major new version of an existing product, the biggest factors determining success actually take shape way before the product gets launched. As with any product in a market, to find big success (or any success at all), a number of things must all happen right and come together on launch day:
1. The product must meet a market’s needs better than the competition and customer alternatives (your product strategy needs to be right)
2. The product must be taken to market through high-volume, competitive routes to market (you need a viable, volume go-to-market strategy and ability to execute in a way that drives sales growth fast)
3. The product must be rock-solid, high-quality and actually deliver the value promised so customers actually get the benefits they’re seeking (and that we’re selling to them). This is critical and must actually be verified with early customer testing and validation (and the product doesn’t ship until it’s actually ready, regardless of the “schedule”).
4. The pre-launch market conditioning must create enough awareness and “buzz” with both prospective customers and sales channels that this new product is coming to enable the product to gain enough early mindshare and traction that leads to both actual “proof” and “social proof” that the product is ready for the market. To grow beyond the initial launch, the product must be proven to meet mainstream customer needs (mainstream customers are notoriously risk-averse, so they want to see other companies like them have already taken the risk and proven the product in their environment before using it).
5. The go-to-market engine must buy into the product early and allocate resources to it (e.g., sales force for directly sold product, resellers/affiliates for indirect sales must choose to invest) … and sales absolutely must have early success at selling the product. If the product isn’t really ready for prime time – it’s dead (the sales force probably won’t touch it again for a long time, if ever, and bad news travels fast). And get this, because it’s super-critical. If the product doesn’t convert better than what the reseller/affiliate is already selling today, it’s also dead (they won’t waste anymore of their precious time on your new thingy, and will go right back to selling what already works for them and makes them the most money today). Sales people are “coin operated” and their behavior and decision-making responds directly to what makes them the most money the quickest (and most of them couldn’t care less about your product).
When a product team gets all 5 of the above things right, the product is often a rapid, even amazing, meteoric success. Of course, it’s really hard to get all of these things right the first time, which is why startups, and even established companies, often struggle and fail with new products.
One of the biggest obstacles to getting all of these success factors aligned together is often the fault of senior management – a lack of “patience” and proper “planning” tends to rush the product team, causing them to take risky shortcuts. We’ve all heard the old adage that “time is money”, and these days management is under extreme pressure to increase sales, profits and meet their growth targets – and to do it fast.
Unfortunately, this time pressure often translates to being unreasonably impatient for both growth and profits. I like one of Clayton Christensen’s sayings, which applies here: “Be impatient for profits, and patient for growth“.
This means it’s fine to be in a hurry to get to market and begin your “learning journey” with something new, but if you rush to get to market too quickly, be aware that your product may well not hit the market’s needs properly the first time out, so if you find yourself in this situation, keep your costs low and avoid going “broad” and trying to hit a home run too early (or you’ll burn your customers and sales channel and have to start over – or worse, you’re project will get cancelled altogether and your world will change overnight – not a lot of fun).
You’re often better off holding back on a broad market assault (and full launch) and instead focus on a smaller portion of the market first, and ensure you’re product is ready and capable of market success. This is called a “learning journey” because you must learn about what the market really needs and what must be done to your product to make it capable of being more broadly applicable. In 21st century Internet-based product launches, we call this the “pre-launch” phase…
In a product launch sense, this learning process can also often be accomplished with some good “beta testing”, where you get early customer feedback and ensure you fully understand customer needs (and they understand your product and “want it”) – before attempting to launch the product broadly.
Inserting one or more early test cycles into the development/release/sales cycle takes time and flys directly in the face of an executive who’s in a hurry… so it’s very tempting to thrust past validating the product’s readiness for market.
Unforutnately, I have seen this fiasco unfold firsthand far too many times in my career. And anytime a product is taken to market prematurely, everyone loses – customers, the product team, sales and the sponsoring executive (who may get fired, reassigned or demoted). Avoiding this one “rush to market” pitfall involves patience, dligence and a willingness to face the facts and deal with them as they arise, only choosing to release that product when the market has told you “it’s ready”.
Customers will definitely let you know when you’re product is ready. They’ll start driving you to hurry up and make that product available for them to use in their business. This is the “go signal” you’re looking for to know for certain the product is ready. You’ll also have early (and real) customer testimonials about the product – and this proof goes a long way to comfort everyone that the product is ready for serious consideration.
Whatever approach you decide to take (faster to market / narrower market focus vs. slower to market / broader market focus), you need to be deliberate with your strategy, and your management team need to all fully understand and agree on the strategy, objectives and level of patience required to be successful.
It’s taken me decades of failures, mediocre sucessses and (a few) big home runs to realize that there’s no shortcut to new product success. One thing that really excites me about launching products in today’s global, Internet environment, is that we now have the ability to accelerate the learning journey and product validation cycle greatly – through building small, focused communities of customers around our products BEFORE we launch them, enabling us to see those “go/no-go signals” efficiently and faster than ever.
I hope these five new product launch success factors and insights are helpful and save you some time, grief and improve your odds of new product launch success – either in producing a great new product, if you’re a product vendor, or in evaluating new products and choosing the right ones to go with in your business, if you’re a customer.