New product development (NPD) is the process of bringing a new product to the marketplace and engaging in marketing, sampling and competitive processes. Your business will engage in this process due to changes in consumer preferences and advances in technology and competition. This blog includes all the key elements that brands should focus on when trying to successfully launch a new product or brand. This includes market research, insights, marketing plans, social media marketing, sampling, reviews and availability of products. New product development can innovate existing markets or open up entirely new ones, improving business goals for growth, revenue, profits and improving the fit between products and markets. It covers the complete process of bringing a new product to market and includes “the conceptualisation, design, development and marketing of newly created or newly rebranded goods or services" (Tech Target, 2019). NPD is essential for business success and growth, helping increasing consumer demand for new and innovative products. A good process and marketing strategy helps you connect your customers to new products before they are mass distributed, building excitement and awareness.
Process
The process for NPD involves idea generation, idea screening, concept development, testing, marketing strategy development, business analysis, product development, test marketing and commercialisation before the final launch. The first stage involves idea generation; this involves creating a pool of ideas from internal and external sources, market research and competitor analysis, as well as team collaboration. Internal idea sources involve the company finding new ideas internally, such as through R&D and employee contributions. External idea sources are ones that the company finds externally, such as distributors and suppliers and competitors.
A popular technique to analyse a product idea is the SWOT technique where you evaluate your ideas strengths, weaknesses, opportunities and threats. You must be careful when launching NPD, as many businesses fail to successfully launch new brands or services. Reasons for failure include wrong launch times, poor product designs, mismatch in target customers, poor advertising and marketing, competition risks and threats.
The NPD process involves generating new product ideas, screening product ideas, concept development, testing, business case analysis, technical and marketing development, test marketing, launch, and evaluation. Therefore, you first need to set out and ask questions in your strategy, including:
What is the market opportunity for this product?
Does the product meet a need?
How does it fit the nature of potential users' requirements?
What are the costs of bringing to market?
How does this product impact the brand?
How does this impact other corporate objectives, e.g. social responsibility?
Strategic positioning helps potential customers to perceive the product, and should take into account economic, functional and emotional factors. Differentiation is largely due to the emotional factor in new product designs, because the market is so competitive. Within your strategy, products should be placed in omnichannel approach. This allows for targeted customers to become actual customers. Your strategy should use consumer data and personalised targeting, keeping the customer experience as the focus through each stage. Amazon is an example of a good customer-oriented approach and development in product strategy, as it is based entirely around customer's needs. They like to work backwards from the target market, releasing a press release before the product. This development focuses on Amazon's internal process in engaging with customers and their specific needs.
Testing
Testing and experimenting helps prevent failures in product development. The ultimate success or failure of products rest upon how willing your customers are to pay for it. Test marketing is the final stage before commercialisation and represents an actual launching of the marketing program. This also allows for market data to create a new cycle of idea generation and possibilities for development. Research, experimentation and testing should be carried out throughout the development process. You will gain an understanding of the likes and dislikes of the product and whether its fulfilling customer's needs and the behaviour of your target audience.
Market Research
Businesses need to enter the analysis stage where they create a marketing plan, focusing on target market, positioning and what marketing channels will help gain exposure. Market research involves collecting, analysing and interpreting data about target audiences, saving time, money and resources. Businesses can measure reputation by market research and identify problems within their brand or any influential features of their products or services. This involves focusing on both the consumers’ needs and the competitor landscape, understanding what convinces people to buy from you. Focus groups and interviews help your brands' positioning and allow you to understand emotions and associations to certain brands. Furthermore, market research surveys also help determine features and benefits to make you stand out from competitors. This involves understanding planned value proposition, market share, competitors and profit goals for the first few years.
Apple is an example of a top company in new product development, they continually add new products such as the Apple Watch, iPad, iPhone and Macs. They also continually add new services such as Apple TV and iCloud. Apple is one of the most successful global technology companies, made possible through product innovation and market research to understand consumer needs. They have a deep understanding of market research and have developed an in-house research team called Apple Customer Pulse. This is an online community that is committed to analysing data and the needs of the technology consumer. Therefore, demonstrating that market research can help you understand consumer needs, competition and the market as a whole.
Insights
Consumer insights allow you to create personalised marketing campaigns and tailor brand experiences, allowing you to understand why your products sell. These also look to back up the market need and the consumers’ requirements. Analysing customer interactions and buying habits helps extract consumer insights, and the right tools can capture and measure consumer behaviours. By allowing companies to map their customer journey, insights help identify any gaps, and understand what works best for their customers. Therefore, improving user experience and customer journey, from awareness to purchase and advocacy. Consumer insight helps analyse human behaviour and trends, allowing brands to understand their audience and improve targeted marketing campaigns. Actionable insights can also help with positioning or messaging during your product launch. Gaining qualitative insights from target audiences is essential for any brand before launch, and you can receive detailed understanding of consumer lifestyle, social media behaviour and online consumption. It also provides new insights into customers styles and needs, to help with future product development.
Here at Free4you, we place products in targeted customers hands pre-launch; this helps gain a true understanding of what matters to customers. If you’re launching NPD or distributing more of an existing brand, our custom insights and retailer-specific data helps listing propositions to gain valuable space on-shelf. If you'd like to learn more about how our custom insights help leverage listing propositions to gain valuable space on-shelf, then click here.
Social Listening
Social listening has become a large factor in analysing customer data on social platforms, allowing companies to map and update customer preferences and how they connect with one another. It gives companies the opportunity to gather valuable customer feedback to inform effective responses or adaptations. Did you know that 94% of consumers research online before making a purchase? This has made it increasingly important for brands to have a variety of accessible reviews for their consumers to reach. Here at Free4you, we enable brands to maximise ratings & reviews at scale and efficiently. Consumer-facing sectors allow businesses to learn about the opinions of customers to help fuel NPD. By gaining actionable insights through focus groups and research reports, you can engage in social listening to gain a competitive advantage. It can also allow you to map consumers’ geographical proximity and where they are most likely to post about a product.
Marketing Plans
We observe how important it is for brands to focus their efforts and budgets on multiple platforms, i.e., TV, PR, social media, sampling and reviews. Marketing is essential in launching a new product and you need to focus on want the customer wants. A marketing strategy should consist of a description of the target market, sales and market share. It should also focus on profit goals, planned long-term sales, distribution and marketing budgets. Strategies should be a cross-channel collaboration, using email, web, social media, SEO, digital strategies and websites to reach target audiences. A successful marketing strategy differs from a marketing plan in that the strategy outlines the goals and direction for marketing whereas the plan identifies the specific actions that will be taken in order to reach those goals. The marketing strategy should look at product design, role of products in the market, profile customers, profile competition, pricing, marketing strategies and how effectiveness will be measured.
It is also crucial to create a targeted and personalised marketing process to help communicate a better and clearer message to attract customers. The market is competitive but by remembering the human factor you can attract audiences in a personal and innovative way. Here at Free4you, we have an intelligent sampling solution, and understand the importance of placing brands directly into the hands of targeted consumers and maximising the outputs. Marketing plays a key role in product development processes and is responsible for providing an understanding of target markets, competitive analysis and positioning. Understanding target customers and their needs is an important step in creating links between solutions and customers, allowing you to understand how the product will fit into the customer’s processes.
Using Multiple Platforms
TV
TV has been a main medium for consumers to learn about new product launches for decades. Nearly half of Brits say that they first noticed new products when they appeared on television. Therefore, this shows the importance of TV ads next to social media or online digital ones. You should combine traditional marketing methods such as TV, radio, and print ads with digital marketing trends such as websites, social media, and emails. This will help to reach a wider audience more quickly for less cost and with fewer resources.
Social Media
Social media is a powerful tool for feedback, especially having a strong presence on Facebook, Twitter and Instagram. Social media engagement is crucial to establishing strong relationships with customers, helping during product launches. By establishing a strong UTM framework for paid and organic ads, you can provide greater visibility into customer touchpoints. In the social media and digital world, businesses that do not listen to customers will find it challenging. Social media and influencers have the power to influence followers to purchase products and spread awareness of product launches.
Sampling
Product sampling is when brands ask for customers to try products for free, in exchange for honest feedback and reviews. Sampling helps increase brand awareness and consumer trust and is one of the most impactful ways to engage new consumers. If a product has 5 reviews, the purchase likelihood is 270% greater than a product with no reviews. Product sampling campaigns help increase social awareness, building brand loyalty and user-generated content before launching a product. This drives traffic to your website, creates a social buzz and increases revenue. If you want to understand more on sampling and how it can engage new consumers, increase brand awareness and consumer trust then read our other blog here.
Availability
This ensures that the products and brand are available as widely as possible with key retailers, online and direct from their own website (DTC). Sharp writes about conventional marketing theories and brand loyalty, he introduces the notion of creating availability for shoppers. He argues that growth in market shares “is largely about building two market-based assets: physical availability and mental availability" (Sharp, 2010), and this makes brands easier to buy. Many stores focus on data and technology to improve customer experience, however creating availability is very important to determine which retailers are most successful. Mental and physical availability can work in tandem to improve shopping experiences in retail store designs. Munk writes that as consumers "experience more and more great options, they require marketers to evolve with them”, therefore retailers should prioritise "availability in all its forms, and working hard to create distinctive brand assets that consumers can notice" (Munk 2018).
Physical availability helps in depth of product distribution, such as supply and stock on shelves and delivery immediacy. Physical availability makes transactions and buying products easy, for example click and collect services and self-check-out stations. An example is Amazon who have extended from online orders to Amazon Go, Amazon Express and Fresh. Mental availability refers to “creating the all-important first, evoked in the shopper’s mind” and this is where marketing is essential. This is about influencing purchase behaviour “by establishing powerful associations in the shopper’s mind” (Applebaum, 2018). For example, brands like Red Bull that have built an audience through strong cultural and emotional connections. Creating mental availability is important as “research shows that customers are far less brand loyal than marketers think” (Applebaum, 2018), therefore brand loyalty can be based on trivial distinctions.
Furthermore, DTC (direct to consumer) means owning "the entire customer relationship and leveraging all the data to create unique, personalised, more efficient, and highest return experiences" (Lindecrantx, Gi and Zerbi, 2020). DTC allows manufacturers and brands to sell directly to the consumer through an online medium. It has advantages with competitive pricing, it also allows you to have direct contact with consumers to get a better understanding of their needs. It also gives freedom to experiment with new product releases and test them with consumer-based feedback. DTC marketing is aimed at the consumer to generated interests and awareness, boosting sales and developing brand experiences.
Conclusion
New product development covers the process of bringing a new product to market or renewing an existing product, with a focus on product design and market opportunities. A new product concept can be physical or symbolic and should be developed into a concept and tested. There needs to be a demand for the product and feedback allows you to develop and craft marketing messages based on product benefits and the problems they solve. There are new opportunities to take advantage of unfulfilled customer needs, new technologies and emergence of gaps and shifts in customer trends. Here at Free4you, we have an intelligent sampling solution, and understand the importance of placing brands directly into the hands of targeted consumers and maximising the outputs. To learn more about what we do, you can check our our social media for updates and information.
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