home Business plans How to introduce a new product to the market. Encyclopedia of Marketing Introduction of a new product to the market

How to introduce a new product to the market. Encyclopedia of Marketing Introduction of a new product to the market

Diversification is the development of new markets by launching new products. There are three main ways to diversify.

1. Launch of a new product accompanying the old one

This is a clear path for the company, since all the tools for promotion and production have already been mastered.

“Last year we launched a knitwear line and a men’s collection. For our company, this was a diversification of business, because previously (for seven years) the basis of our assortment was hats and other accessories. We quite consciously decided to enter the highly competitive clothing market, where nothing has surprised anyone for a long time. Many partners did not believe in us and considered this step a mistake. However, we have high hopes for this direction,” Larisa Menshikova, General Director of Noryalli.

“In 2014, we began to develop the idea of a service for events - this happened in the company of integrated marketing communications for pharmaceutical companies and FMCG. Subsequently, we developed the service into a separate product, and then into the WhenSpeak company - an IT platform for interactive communication between the speaker and the audience. Every day I am convinced that the new direction was chosen correctly,” Dmitry Vasilkov, co-founder and CEO of WhenSpeak.

2. Release of non-core products for traditional consumers

The opportunity lies in the existing market, and the binoculars need to be tuned towards the consumers of the main product.

Alexandra Gudimova, founder of the Bionova brand, NovaProduct AG company

We were in search of a mass-produced traditional Russian product, and porridge in this regard ideally met our ideas. In the process of assessing the market, we noticed that, despite the presence of fairly large players, including international ones, the composition of the products was far from ideal. Therefore, we decided to create a traditional product, but of better quality. We set a course for healthy eating: since there is an increasing lack of protein in the modern person’s diet, and cereals contain slow (correct) carbohydrates and protein, we considered this product ideal for expanding the company (previously we only dealt with sweeteners and additives). Instead of sugar, we added a natural sweetener, as well as bran and inulin (a natural prebiotic), thereby obtaining the most functional product.

There is a global trend towards snacking and fast food products, while at the same time the healthy food market is growing rapidly. We have created a product that simply meets customer needs.

3. Release of new products that do not correspond to the company profile and are aimed at capturing a new market

Also, any company that can be bought at a profit is a suitable target for the expansion of another company.

“In 2012 we acquired Charterhouse, which developed and distributed print and digital communications, and two years later we acquired leading UK communications agency Indicia. For what? This was a logical decision for the company: strong expertise in the field of print management plus production capacity, coupled with such diversification, made it possible to strengthen the portfolio of services provided by expanding “beyond print”,” Maria Zhuravova, head of marketing services at Konica Minolta Business Solutions Russia.

Possible pros and cons of diversification:

Do as I do: the experience of major players

Not only small and medium-sized businesses, but also large players, including state corporations, are ready to expand and explore new niches.

"Rostec"

Sergey Anokhin, General Director of Ramensky Instrument Plant JSC (part of KRET JSC)

Ramensky Instrument-Making Plant has been producing complex navigation instruments and complexes for aviation for more than 70 years. Like other Rostec enterprises, RPZ has begun diversification, and our plans are to increase the share of revenue from civilian products to 50% by 2025. One of the directions the plant has chosen is the production of innovative devices for air purification and disinfection. We took the innovative TIOKRAFT technology, well-known on the market, as a basis. The effectiveness of this system has already been confirmed, which provides serious competitive advantages.

The company has significantly expanded the scope of application of the technology: air purification devices can be used in medical institutions, social facilities and industrial premises, and are integrated into the ventilation system of public transport, including trains. In the future, they will be used in civil aircraft and even in spacecraft. Taking into account the expected volumes, the production of air purification systems can be a good utilization of the main production capacities.

Igor Zhdanov, project manager for civilian products of JSC NPP Start named after. A.I. Yaskina of the Technodinamika holding

Solving the problem of diversifying production, the Technodinamika holding launched its pilot project. At the Ekaterinburg Research and Production Enterprise “Start” named after. A.I. Yaskina developed a mechanized parking SNM-100. It is designed in the form of a rack with built-in movable pallets. An important design feature is the tightness of the pallets, which exceed the dimensions of the car. Car owners do not have to worry about dirt, rainwater, chemicals and traces of petroleum products getting onto their underlying vehicles.

The choice of direction is not accidental. Mechanized parking has two main advantages over conventional parking: saving parking space and the ability to reduce human participation due to full or partial automation of the parking process. The product is in great demand in Russia, but is rarely used yet.

APH "PROMAGRO"

Konstantin Klyuka, General Director

The agro-industrial holding "PROMAGRO" has been operating in the meat market for more than 15 years. This area has already been well studied, the market is saturated, and the business requires constant development. We began to analyze where to move next. As a result, in 2018, PROMAGRO created a textile division and began construction of the first flax mill in Russia in 30 years, which will produce flax fiber. We focus on exports and domestic import substitution.

The textile direction is interesting from the point of view of the possibility of creating an “industry champion” - which is what we would like to achieve within the framework of the Russian Flax project. There are conditions for this: the market has not yet been formed, government support is noticeable. But, as in any industry, flax growing has its pitfalls, for example, a long payback period for investments.

PepsiCo

Margarita Molodykh, Marketing Director for the Baby Food category in Eastern Europe

We recently launched two new products - fruit and vegetable purees and Agusha fruit and cereal purees.

Firstly, we assessed the attractiveness of the doy-pack segment (a special type of flexible vacuum packaging, which is a plastic bag with a bottom, which allows the package to stand upright when filled) in the baby food market. In 2011, we were the first to launch this packaging format.

Secondly, we looked at the right to succeed “Agushi” in this market: we have expertise, thanks to which we understand what exactly the novelty of the product being developed will be.

Thirdly, there is growth potential: doy-packs are a very convenient format of baby food for modern mothers who are not ready to stay at home, and their need for a healthy snack is one of the highest.

In order to launch a new product, we advise starting with the consumer, and also drawing up and calculating a business case or financial model with an understanding of how long it will take for the innovation to pay off.

"Baltika"

Ekaterina Potokina, senior director for development of licensed, low-alcohol and non-alcoholic brands

One of the directions of the “SAILS’22” strategy of the Baltika brewing company, which is part of the Carlsberg Group, is to increase the share of the non-alcoholic category in the company’s portfolio. A completely new segment is alco free brews - non-alcoholic drinks that are produced by brewing, but are not beer. In the spring of 2019, we launched the first product of this line on the Russian market - a natural Barley Bros drink without added sugars, sweeteners or preservatives.

To arouse consumer interest in new products, a business must offer something unique and completely new, from the concept of the product itself to packaging and communications. Thanks to Barley Bros, we reached new consumers - those who were not reached by our traditional products.

When releasing a new product, we do not set ourselves the task of diversification as such. For us, this is an opportunity to cover all kinds of consumer markets so that people always have a choice of products from our company.

Elena Volgusheva, senior director for export sales and intragroup supplies

Consumers are interested in products of foreign origin; they stand out in taste compared to already familiar local products. For example, many markets in the Middle East are quite complex in terms of legislation - there is a complete ban on the sale and consumption of alcoholic beverages, special requirements for product labeling, and it is necessary to comply with Halal requirements. At the same time, due to the hot climate, refreshing non-alcoholic drinks are very popular among consumers. Taking into account the peculiarities of the regional market, Baltika focused on the supply of non-alcoholic malt drinks - Baltika 0.

Thanks to the production of drinks for export, Baltika has expanded its presence abroad and is a leading exporter. The company is represented in more than 75 countries, in 43 of which the company is the only Russian supplier in the category. Advice to those who want to expand the presence of the company - carefully study the foreign market: find a reliable partner, study the legal requirements and consumer preferences, because they play a key role.

KROK

Ilya Simonov, director of CROC VR

Previously, we had many different areas within which we created VR/AR solutions. All of them seemed effective and in demand to us. But later it became clear that it was necessary to look for a specialized direction, developments in which would bring real business benefits to the client. We currently specialize in the industrial application of immersive technologies (VR/AR). Our products, such as VR simulators and digital models, make it possible to train employees in enterprise safety and reduce the risk of incidents and production downtime.

We recently came to the conclusion that this is not enough, and, most likely, in the next few years we will create several more products for the same area, packaging them according to the developed methodology.

From the experience of our team, I can say that first it is necessary to carefully test hypotheses and devote as much time as possible to the client: not to focus only on the technological part, but to communicate more and try to understand the client’s tasks, show empathy and dive into the production specifics of a particular company in detail.

Ingate

SergeyNikonorovVP Service Delivery

Two months ago we released a new product on the Internet marketing market - Digital Complex. When developing, we were guided not by the company’s competencies, but by the client’s needs. We interviewed business owners, surveyed marketers, and looked for their pain. We found out why companies had no sales: it was problems with the product or difficulties in attracting. And they created a product that increased online sales quickly and with a guarantee.

First clients are like first children; it is important for them to set expectations at the start: not to give too little or too much, otherwise there will be trouble. This happened to one cosmetics company. In the first month, we received 300 requests and calls from the site instead of the promised 35, and this was a mistake. The client didn't know what to do with them. Sales managers couldn't cope, missed calls, responded to requests within a week. In August, we lowered the bar to 120 leads, but that didn’t help either. As a result, the client left us and took a break to sort out problems in the company and scale up the sales department.

Ozon

Maria Yakimova, Director of New Services Development

Now Ozon has more than 30 million users, and, of course, it is important for us that customers return and become regulars. For loyal customers, we have launched an Ozon Premium subscription - the first such product on the Russian market. Now before launching, we test materials for 3-4 interviews with users. Thanks to our own UX laboratory, we can carry out this testing in 2-3 days.

Any new service raises questions. After launching the product, you should be prepared for the fact that the load on the support team will increase. In addition, all materials for communication with clients need to be tested on real users, for which you also need to prepare.

Nikita Saygutin, Vice President for Digital Financial Services

Ozon was the first in the Russian e-commerce market to begin creating its own ecosystem of financial services, not only for buyers, but also for sellers of its own marketplace. Thus, the Ozon Card bank card provides a number of opportunities for users: there is cashback, which is returned with Ozon points, a lending service and the Ozon Invest p2b lending service, which helps marketplace sellers raise additional funds for business development.

Since we are talking about financial services, when launching it is important to understand that behind the MVP (design pattern for creating software) lies a much more complex solution than just a web service - this is a security system, scoring, and regulatory framework. In addition to development, you must have a strong legal and customer service team when you launch, otherwise you will get bogged down in operational work. After launching the product, try to set up the monitoring system as quickly as possible - this may sound like an obvious thing, but it will help to quickly resolve problems, even with the rapid introduction of new features.

What does everyone in your industry need? How much do you have the resources needed to launch this product? It’s worth considering this before launching a new direction. If you have used all the opportunities in your industry and there is nowhere to grow further, then diversification is an excellent growth tool.

How to make the most of a new product launch: checklist

Find and package your idea correctly.
Analyze the target audience, risks and feasibility of releasing a new product: talk to consumers, conduct examinations and surveys of potential clients or buyers.
Don't be afraid to test your idea with your employees.
Find quality suppliers: ask for samples of materials, read real reviews, find those who have already worked with them.
Look at what your competitors are doing and do it better or differently.
Develop a strategy for promoting your product to the masses.
Don't be afraid to pause production if necessary.

Remember that diversification requires rigorous planning and a large supply of resources. Before launching a new product, evaluate whether your business has the funds for such experiments. Share your experience in launching new products and business lines in the comments.

Prostova Natalya Head of the EMC Project Department
Renard Andrey Vice President of EMC
Magazine "Company Management", No. 10, 2005

This is obviously a crazy idea.
The only question is, is she crazy enough to be right?
Niels Bohr

Part one. Manuscript found in mailbox (electronic)

“Dear FRIEND! You have to surprise the world - come up with a new product, successfully bring it to market, make everyone happy and get terribly rich! It’s very difficult, but remember the main thing - don’t be scared!
You must remember and repeat to yourself every morning the thirteen commandments, here they are:

To get a truly worthwhile new product, you need to consider at least 20 ideas, 2-3 of which already seemed brilliant to you.
Don't believe marketers who tell you that people buy what they want - people only buy what they want.
People don't often want what they need.
People love new things if they have something to compare them with; but even more often than new things, people buy what they know from the cradle.
Oddly enough, people buy cleaning powder to clean their bathroom.
If you don’t remember what the girl you like is wearing, when you return to the dance hall, you won’t find her; the same applies to packaging and product name.
By improving it a little, you can sell hundreds of times more.
If they don't buy it, then let them want to buy it.
People won't want to buy until they are interested in the product.
If there are no rumors and legends about your product yet, spread them yourself.
Attract only the first hundred buyers with a low price; the next thousand will pay for them.
Before you set off on an ocean voyage, swim in the bay in clear weather: test your product on buyers.
Products exist not because of beautiful names, but because it benefits everyone.

This text was written in Shanghai in the 15th century. and has never changed since then. Don’t throw away this letter, but rewrite it 20 times and send it to your friends and partners. And then you will be happy!
One president of a former large holding company began to laugh and gave the letter to his secretary. And now, for five years now, the holding has not existed, and the former president himself works as a night watchman.
Another commercial director was not lazy, reprinted the letter and sent it to his colleagues - today his company entered the New York Stock Exchange with ADR.
And these examples can be given a thousand!
One woman, who sold from a box near the metro, spent the entire night rewriting this letter, sending it out to her friends, and now owns a chain of haberdashery stores in New Orleans and Stary Oskol.
The industrialist Nobel drove away the messenger with this letter, and soon a revolution broke out - he lost all his oil mines and gunpowder factories right in Petrograd itself. And the great-grandson of a loader from Nobel's gunpowder factories, a candidate of mineralogical sciences, traveled all over Turkey and half of China, became rich and immediately went bankrupt into default. And just when he decided to commit suicide, he received this letter; he did everything as expected, and now he has a chain of supermarkets throughout the country. He called it “Thirteen” in honor of the number of commandments. Happiness came to him exactly on the 1028th day after sending the last letter.
And if you do everything right, then happiness will come to you, maybe even faster!..”

Part two. Examples and counterexamples

There is no doubt that, remembering all 13 commandments and having certain qualities (or experience) of a manager and marketer, you will always be able to organize the launch of a new product on the market. Most likely, you will pursue two opposing goals: to save budget funds and to get into the top ten with your new product. Is it possible to combine these goals? Let's turn to existing practice.
In the press, in books and in life, we will find a lot of examples of the “right” and “wrong” launch of new products that ultimately turned out to be successful. It happens that everything is done correctly, but ends in failure; sometimes it’s the other way around - faith in the idea of a new product, despite all forecasts, leads to a win. Let's look at a few typical examples from the practice of EMC.

1. A classic example.
The preliminary research served as the basis for refusing to launch our own production of powdered milk, a new product for our customer.

Period: summer - autumn 2000
Contents of the work: marketing research on the feasibility of opening your own production of powdered milk (study and analysis of the competitive environment, supplier proposals, opportunities to work with raw material suppliers; assessment of the project’s payback).
A comment. As a result of the project, based on EMC recommendations, the customer decided that it was inappropriate to invest in its own production of milk powder. According to the customer’s review, “this project helped save more than 300 thousand dollars.”

2. The example is original.
The low-budget research provided most of the parameters for the successful launch of a new product for the market - fruit ice.
Customer: Metelitsa is an ice cream manufacturer.
Period: summer 2000
Contents of the work: conducting focus groups to select the most interesting flavor of fruit ice, as well as the packaging concept and name of the new product. Focus groups were conducted with the participation of schoolchildren practically free of charge (payment was several boxes of ice cream, distributed free of charge at school by “members of the expert council” - high school students).
A comment. Based on the results of the study, out of four flavors proposed by the technologists, two were retained. Based on the suggestions of focus group participants, packaging was developed and the most successful name was chosen, under which this product is still sold today - fruit ice "Ledinka".

3. The example is sad.
An entrepreneurial approach to the launch of a new brand of cabinet furniture did not allow the implementation of a wonderful idea.
Customer: furniture factory near Moscow (name not disclosed to maintain confidentiality).
Period: winter 2004-2005
Contents of the work: a detailed study of the company’s actions to launch a new brand. Assessing brand effectiveness in the market.
A comment. As part of the project, all areas of the company’s work on the brand were explored; the actions of the company and its managers to launch the brand were assessed; areas that have not been worked are indicated; recommendations were given on the necessary work with the brand at the current stage of market development; market indicators of awareness, brand perception, etc. were measured.
As was revealed during the project, more detailed planning for the launch of the brand and a careful approach to its concept would have helped the company avoid losses associated with opening a salon under a new brand. Moreover, a preliminary market analysis would help position the brand correctly and make a good profit, since the entrepreneurial idea itself was truly in demand by the market.

4. The example is unusual.
Preliminary marketing research made it possible to identify the need to provide a new service on the market - a funeral service reference service, as well as to develop an advertising strategy in the unusual conditions of this market.
Customer: Department of Ritual Organizations and Services (UROS).
Period: autumn - winter 1998
Contents of the work: marketing research into the feasibility of creating a funeral services reference service, the problems of its formation and implementation, choosing a name for the service, developing a corporate identity and advertising strategy.
A comment. The customer set the task of creating a reference service for funeral services and then using it as a tool for promoting the services offered by the holding companies. At the same time, the task was set to bring this service to the market - from choosing a name to developing an advertising campaign. Marketing research was carried out to find marketing steps to distinguish itself from competitors in the eyes of the client, as well as to find and model the name of the service.
Unfortunately, the customer’s true goal was different - to obtain public support for future parliament.
In addition, the desire to follow the competitor’s strategy forced the customer to blindly copy his moves - and not take advantage of any of the existing effective developments.

5. Role model.
A successfully found brand name and a well-thought-out research program made it possible to introduce a new brand to the shoe market in a short period of time and increase the customer’s turnover tenfold.
Customer: American company (name not disclosed to maintain confidentiality).
Period: 1993-1995
Contents of the work1. “The business owners set us a difficult task: the name should be sonorous, like Monarсh, and carry some kind of legend. Immediately the idea arose to choose the place of origin of the product. In fact, they wouldn’t believe it if they wrote “France”, “Italy” - it has already been compromised by the Chinese, "Germany" - they make good men's shoes, and we have 80% of women's shoes. They settled on Austria: it seems to be German quality and at the same time something elegant, feminine. You know, "Tales of the Vienna Woods" there. , “The Bat”, “Who can compare with my Matilda?”? The name was chosen by pointing a finger at the German-Russian dictionary, and one finger hit the right spot - Walzer! In the translation, ideas for videos began to appear: the girl tries on. mother's shoes and waltzes, or does a lady flirt with a gentleman and hide a note in her sandal?
Then the problem arose - where to produce? Having carried out marketing, we prioritized costs: it turned out that it was cheapest to produce in a women’s colony near Mozhaisk, China was in second place, and Portugal was a little more expensive. Believe me, I really wanted to sew in Russia, just to avoid customs. After all, shoes are like peaches: you’re a week late and you won’t be able to sell the lot. In addition, there are subtleties. Let's say, women's shoes can be made in Russia, and the lasts can be ordered in Italy, but men's shoes, on the contrary, are better made in Slovakia or China, and the lasts in Russia. But even with all the overhead, it turned out to be more expensive in Russia: our factories include in the price in advance their inability to work five years in advance. Therefore, the first batch of sandals was made in the Chinese province of Shenzhen, in a free economic zone. But legend defeated reality, and soon the owners tore up the Austrian design, and then moved production to Austria. And here's what's interesting. Even our Austrian counterparty immediately believed in the original Austrian origin of the brand: how, I remember, there were such shoes!
By the way, it was very important to come up with not only a product brand, but also a company name. Here everything is the other way around - no foreignness, we need soviet conservatism so that small wholesalers are not afraid of being “dumped.” One boy on the team came up with the idea: “Soyuzintorg.” The choice turned out to be very accurate: I was working in a sales area at the time and I remember how clients assured me: they say, we have been working with you for 12 years! As a result, the company's turnover increased tenfold in 1993! And to this day, Walzer shoes are in demand in Luzha, a shoe wholesale center in Russia. Moreover, we have already discovered a lot of counterfeits that are produced in eight countries around the world - Taiwan, Italy, Austria, Russia and Eastern European countries. And it’s symbolic that one of the strongest designers in the world, Roberto, is working with a trademark that arose as a scam.”
A comment. After the success of the first Walzer collection and a significant increase in turnover, the company was able to place orders in production. More than 800 models were presented to create the new Spring 1995 collection. Such a volume cannot be studied using classical methods. An attempt to involve experts in this process was ineffective. The marketing research program for the new collection was built adventuristically, but at the same time the adventurism was implicated in the methodology. The study was targeted, but the points were selected in accordance with the specifics of a particular market.
Says A. Renard (vice-president of EMC, project manager during this period): “In my memory, this was the cheapest and most effective research that we and our competitors conducted. First, we sent two girls (a style expert and an expert on design) to a clothing exhibition in Paris. Experts brought an analysis of trends: what would be fashionable in the next season depending on clothing (fashion in Russia at that time was about a year behind compared to Europe).
After preliminary selection based on the presented analysis, the prepared collection was placed on the sales floor for demonstration to wholesalers. During this period, wholesalers were interested in the winter collection, and it was very difficult to distract them for research, even for two or three short questions. Nevertheless, the new collection could not fail to attract their attention: they approached the shelves and carefully examined the models that interested them. And each pair had a cheap chip sewn into it (less than $1), which responded to the number of times the model was torn off the stand. Thus, the most interesting models for wholesalers were identified. “Leaders” were studied separately. And from the “average” ones, the most promising models were selected, with which the agents went to other shoe companies as representatives of China, offering to put them into production. All together gave an assortment map. As a result, the collection was very successful, and minimal funds were subsequently spent on further promotion.
We clearly understood that our clients are wholesalers. By conducting preliminary research on fashion trends, we helped them sell our products to the end consumer. Having studied competitors' offers, we determined the optimal ratio of assortment items so that there was nothing superfluous in the collection and in volumes and there was enough of everything. Moreover, everything was done in the shortest possible time and with a very modest budget. And we also saved money on promotion."

Part three.

Instructions for geniuses
Who needs a methodology when introducing a new product to the market and why? If we talk about entrepreneurs, “sales geniuses” and “intuitive marketers” (not to be confused with “managers” and “marketers”), then the technique is most likely harmful to them. Imagine a centipede that was asked which leg it starts its journey with and in what order does it then rearrange these legs?
There will always be examples of ingenious discoveries, products guessed by instinct, technologies suggested from above. It is unknown, however, how many of these “guessed”, “prompted” and “brilliant” ones failed miserably, causing a complete collapse. But if you consider yourself a genius, then do not bother further reading this tedious article: the technique will not be useful to you - it will only interfere with listening to your inner voice.
Forward!!!

Part four.

Methodology for mere mortals
This part is intended for us, mere mortals - managers and marketers who are asking the age-old question: is it possible, with the help of some technology or methodology, to reach the level of talent (we don’t need a genius), while maintaining at least the market average profitability? Let's consider the simplest diagram that you can rely on when answering this question.
It is assumed that we have already conducted a preliminary selection of new product ideas and selected several of the most attractive ones. The very process of selecting ideas, methods of evaluating and comparing completely different ideas is the topic of a separate article. There are certain methods and approaches that allow you to manage the emergence of ideas, the methodology for their step-by-step selection, etc. Here we will not consider this block of work. Let's start with the already chosen idea (see picture).
Let's look at this technique step by step.

Block 1. Testing the idea
At this stage, the idea of a product is usually formalized: a description of the product is drawn up, its distinctive features, nuances of technology, competitive advantages are indicated - everything that will allow it to find its niche in the market.
Such a description, as a rule, does not contain exact characteristics, such as weight, size, color, etc. Rather, when formalizing the idea, ranges are designated according to the specified characteristics and consumer qualities are formulated, for example, taste, smell, usefulness, convenience, etc.
Here it is very important to describe, as a first approximation, the differences between the new product and its analogues or direct competitors.
Don't skip this step! Otherwise, there is a great danger that different departments of your company will model, research and prepare the production of completely different products! We know how fragile and inaccurate oral histories are!
After compiling a description of the product, it is necessary to analyze its place in the company’s current assortment: which products the new product will replace, which ones it will complement. This analysis often leads to the timely refusal to release a new product: for example, because it displaces the most profitable or successfully sold one available?
I remember many examples of how a new product itself did not achieve planned indicators and significantly reduced the volume of revenue from existing products. This was the case in example No. 3, when the new brand “ate away” some of the consumers from the old one, but itself did not reach the volume that would recoup these losses.
It is very important, even before launching full-scale product research, to understand what place it will have in the company’s assortment. It is at this stage that the first significant screening of ideas occurs: out of 10-20, 2-3 remain.
Don't worry if some ideas are discarded! This happens not only when the new product concept doesn't fit into the market, but also when it doesn't fit into your product line.
If it seems promising to you, work on it separately!
There are cases when such an idea is easier to implement in the form of a separate business.

formalization (description according to the diagram) - preliminary requirements (wishes) for sales, production; consumer properties of the product; planned differences from competitors, etc.;

comparative sales modeling.

Block 2. Initial study
In this block, a request for marketing research and technological development of a new product is generated. In this case, the research can and should be small, low-budget, but providing answers to precisely asked questions: how will buyers react to the new product, how much are they willing to pay for it, what analogues are offered by competitors?
At the same stage, it is necessary to determine possible options for the technologies used, as well as explore the limitations and capabilities of existing production, the need to purchase new equipment, recruit new qualified personnel, etc.
The combined results of these two studies will assess the prospects for working with a new product on the market. It often happens that existing production cannot produce a new product at acceptable market prices, and re-equipment is too expensive.
The analysis will make it possible to assess the real capabilities of the company - both internal and external - to launch this particular product and abandon it in a timely manner, saving a lot of money. In this case, it is better to spend a few thousand dollars on research than to lose hundreds of thousands of dollars on equipping a new production facility, relying on intuitive assumptions. This is exactly the case considered in example No. 1. According to our estimates, savings ranged from 600 thousand to 1 million dollars.
If you are not going to produce a new product yourself, but are ready to place an order at one of the existing production facilities or are working with product manufacturers, this step still cannot be skipped.
It is necessary to analyze the capabilities of a potential supplier, conduct marketing of possible alternative channels, etc.
And this is the second point of selection of ideas: now out of three there is only one left.
Methods/tools used:

production diagnostics - modeling capabilities;

analysis of results - it is possible to use SWOT analysis in a reduced volume.

Block 3. Clarifying studies
The tasks of this block of work are the development of precise technical specifications (and technical specifications - TS) for the parameters and external design of the product, indicating the necessary technical characteristics (color, size, weight, etc.), determining the most effective sales channels and methods of promotion, clarification price range and obtaining other information necessary for drawing up a business program (business plan) for the launch and promotion of a new product.
As our practice shows, even at this stage it is quite possible to get by with low-budget research (see examples No. 2 and No. 4). To do this, it is necessary to regularly monitor the needs and preferences of the company’s clients, as well as the competitive situation in the market. In addition, research in this block may be less expensive if the previous steps in the method have been worked out carefully and successfully.
At this stage, the product name, the main positioning parameters, as well as the most significant aspects of the promotion strategy are determined. It should be taken into account that the work of this block is closely related to the next stage of bringing the product to the market.
Methods/tools used:

request for marketing research (technical specifications) - parameters, criteria, completeness and depth, resources, deadlines;

marketing research program - development, implementation;

marketing research - methods are selected depending on the specific request and product: open sources, sample surveys, etc.;

analysis of results.

Block 4. Trial production
A very important stage, at the end of which it becomes clear how much our calculations coincide with reality. In production, this stage is also known as "prototype".
Product samples are made and undergo comprehensive technical and technological examination. Packaging options are being checked.
Here you can clarify the profitability (profitability) of the future product. At the same time, it is necessary to clearly understand that to calculate the planned cost, you cannot directly use all the values of similar parameters when preparing a test sample! It is still impossible to calculate labor costs, rejection of materials and raw materials, etc. Nevertheless, many parameters are being “clarified.”
Upon completion of this stage, the product production technology, its weaknesses, and possible risks are clarified.
If you don’t have your own production, you still need to get prototypes of the future product, manufactured in accordance with our technical specifications, in our packaging, and not “model samples” from the manufacturer. At this stage, it is advisable to send engineers or technologists to the future production (no matter where in the world it is located!), so that they can analyze on the spot not only the quality of the resulting product, but also the quality of the organization of its production.
At this stage, we can and must analyze real (and not hypothetical!) production possibilities, model the cost of a new product and determine its economic feasibility for the company.
Upon completion of this stage, a decision is also made on the advisability of launching a new product into mass production.
Methods/tools used:

technical specifications (TU) for the product - technical and technological characteristics, requirements for raw materials, materials and equipment, restrictions, etc.;

examination of samples - expert assessments, “focus groups”, “quality circles”, etc.;

cost calculation - in accordance with accepted accounting standards and rules; accounting for overhead costs, variable costs, etc.

Additionally: "trial sales"
Sometimes, for completely new products on the market, it makes sense to prepare and conduct so-called “trial sales”.
This method is very often used by trading companies - do they have the term “take it for testing”?
When organizing “test sales”, you need to draw up a precise sales program: what exactly do we want to test through this promotion?
In no case should you set yourself the goal of selling a trial batch of a product with a planned profit - it is much more important to check the accuracy of the choice of packaging, price, promotion methods, and sales channels.
Methods/tools used:

“trial sales” program - tasks, conditions, methods, deadlines;

organizing “trial sales” - logistics, instructing sellers, collecting information;

analysis of results.

Block 5. Withdrawal (promotion) program
The results of the third and fourth blocks of work (and sometimes “trial sales”) provide the basis for the development of a business program (business plan) for the launch and promotion of a new product. The detail and elaboration of this program depends on the specific situation: product, market segment, degree of saturation, etc.
For example, the program may consist of the following sections:

description of the product (including its strengths and weaknesses);

product positioning;

sales markets and target audience;

sales policy (including a description of the “ideal” buyer);

sales channels (existing, new);

sales promotion (tools used);

individual special marketing projects and their implementation (special projects aimed at promoting a new product, for example participation in an exhibition, “promotions”, etc.);

trading conditions (relationships with customers) and pricing policy;

advertising and PR;

marketing budget.

When developing the program, all available information from the market and production is checked again, and calculations are clarified. Ideally, the program should undergo examination.
It is quite possible that experts will find significant flaws in it that will force them to either return to previous levels or even abandon the release of a new product. Example No. 3, which we have already mentioned, was just such a project. However, our specialists conducted an examination of the program after the fact, when certain losses had already occurred (which, in fact, was the reason for the examination). You can avoid many mistakes by consulting with experts in a timely manner.
The most loyal clients, independent market specialists, partners, management and marketing specialists and consultants can be involved as experts at this stage.
Methods/tools used:

examination of the program - expert assessments, results of “trial sales”, customer surveys, etc.;

SWOT analysis - the presence and content of winning promotion strategies.

Block 6. It's finally happened!
And now that all the difficulties have been overcome, all the checks have been made, it is necessary to begin implementing what was planned.
Based on the program obtained in block 5, a detailed work plan with a new product is built for the marketing and sales departments, and the production plan is adjusted accordingly.
According to experts, for a period of one to two years, a new product should be in the close attention of all top managers. Constant monitoring of the situation will allow timely identification and correction of errors and inaccuracies. This minimizes the risk of failure with a new product. But there will always be mistakes and blunders, since even the most large-scale and expensive research does not provide a one hundred percent guarantee of success.
An effective method is to allocate a separate “product manager” assigned to a new product. The entire “chain” should be in the area of his attention and control - from the purchase of raw materials to final sales. The task of the “product manager” is to promptly inform management about any cases when the actual development of the situation deviates from the planned plans and indicators. It would be logical to tie his salary to the results of serial sales of this product.
Methods/tools used:

structure of the promotion program - required volume, degree of detail;

production plan - dynamic, including adjustment mechanism;

cost adjustment program - based on actual labor costs;

algorithm and plan for launching the product into production;

distribution of control functions - for the period of launch and ramp-up of a new product to “design capacity”.

Part five. Let's sum it up

What does the proposed methodology give us?
First of all, it allows you to break down the entire project to launch a new product into separate stages, after each of which a decision is made to continue the project or exit it.
Each stage has a certain cost and a specific result, and this is the key to successful planning and organization of work, as well as the ability to control the project.
Depending on the situation in the company and on the market, one or another stage of the project can be significantly reduced or skipped altogether.
The concept of bringing a new product to market outlined here requires some ingenuity in putting it into practice and making real improvements in the company's work on new products. Answers to vital questions “how?”, “in what way?”, “in what ways?” not so easy to generalize. A new product launch program that is successful in one case may often be unsuitable and often dangerous in another. That is why we focused on the main, fundamental steps - the stages of work on a new product.
The presented scheme is the most general algorithm for working on a new product. It takes into account most of the commandments and allows you to remember them. For complex situations (an innovative product, a saturated market, etc.), the diagram can be detailed and supplemented with other necessary blocks.

We wish you, dear reader, successful new products! There is no need to rewrite this article 20 times, but three or four photocopies for office managers won’t hurt!
Good luck!!!

Elena Nasobina, project manager at Tochka bank for entrepreneurs

Not long ago we launched a product for calculating taxes for individual entrepreneurs. Some clients enthusiastically accepted the new service. They understood that the probability of an error in the calculations of the “machine” was much lower. But among the clients there were also those who were wary of the new service. Some entrepreneurs have been entrusting all calculations only to their accountants for many years and did not want to “trust” a soulless machine. The main snag was that it was very important for them to have their own person who they could turn to at any time.

In many cases, skepticism was overcome thanks to the fact that we sat down with clients and described all the calculations in detail. Or they calculated together using a formula from the tax authorities, why such a sum of contributions was calculated.

There are also clients who really liked the service - they didn’t really want to go into the details of the calculations, but warned: “If something happens, you will be responsible!”

It is difficult to say why this particular product caused skepticism from customers. There is no need to say that people are simply not ready for innovation, because cloud accounting has been on everyone’s lips for a long time.

2. We were not prepared for high demand

Ekaterina Makarova, co-founder of BelkaCar car sharing

When we launched premium car sharing BelkaBlack, we did not expect such a boom. On the day of the announcement, the number of applications exceeded ten thousand - no one was prepared for such a development of events. We sat day and night and solved the problem only a week later, when the number of verifiers doubled.

When you introduce a new product to the market, you should work out as many potential situations as possible: what to do if an emergency happens, where to hire people, from which departments to attract employees, which relatives to call if the team cannot cope. You should have a ready-made solution for all these problems so as not to waste time working through the situation later.

3. Clients did not understand the logic of pricing

Dmitry Zubkov, CEO at Dostavista

Our express delivery service now operates in 10 countries around the world. We launched in India in 2016 - before that there were delivery services there, but our service was a new product: crowdsourced door-to-door delivery in 60-90 minutes.

At first there was a problem with addresses: in Indian cities, only districts and streets are indicated on the map. The buildings do not have numbers. This created difficulties for couriers and customers.

The former often could not find the right address or Google Maps showed them the wrong point on the map, and they simply arrived in the wrong place. And clients did not understand how the tariff was formed. The same delivery could cost differently today and tomorrow.

They “helped” again: if you change at least one letter in the address description, they will consider it a different point. For example, today a client could write: “Mumbai, Link Road, the house is opposite a vegetable shop,” and tomorrow - “Mumbai, Link Road, the house is red, there will be a vegetable shop across the road.” The service, by order of Google Maps, calculated different prices.

We solved the problem by changing the algorithm for calculating tariffs: now the cost is calculated based on the distance between specific small areas, and not points that were previously determined incorrectly. It is still difficult for couriers to find a specific house; it helps to be able to contact the client via chat or phone.

4. We wanted to receive money immediately (but it didn’t work out)

Sergey Shalaev, founder and CEO of Relap.io

In 2014, the Surfingbird team and I began working on a new (at that time) project, Relap.io. We had internal fears - if before we were engaged in a b2c project, now we decided to switch to b2b, since even then we felt an increase in demand for native . But no matter how big Surfingbird was, we understood that we were about to hit a ceiling in terms of inventory growth and were afraid that by doing everything at the same time, we would not succeed anywhere, but we still decided to open up new opportunities for ourselves. And, as it turned out, not in vain.

The main problem was that we wanted to immediately get paid for using recommendation technology with the media. But it didn’t work out that way, since these were not the best of times: media managers simply did not have extra money, and it was very difficult to convince editors and journalists that our algorithms could suggest more interesting content to the reader than the editor.

As a result, we decided to provide our technology for free, which we still do today.

And time solved the problem with installing the widget and the conservatism of the market - the journalists really saw that readers liked our recommendations, they fit naturally into the site’s content and did not cause rejection. Readers began to spend even more time on the site, which affected the amount of advertising inventory at sites. Subsequently, we invited partners to mix recommendations with advertising and earn money with us.

5. Launching a new product is a lottery

Yuri Galtykhin, product manager of JSC Firm MMS (PROLOGY brand)

Bringing a new product to market is always a lottery. You never know how customers will accept a new product until it hits the store shelf. But before the product ends up in the store, you need to go a long way - from developing the product concept to delivering the finished batch. And every stage has its own difficulties.

In electronics manufacturing, the biggest headache is designing the electronic part itself. Let's say we decide to release a new model based on the existing one - but we need to reduce the dimensions of the case and add several functions. In theory, this is not very difficult for car radios: they usually have a lot of free space inside. We install the new main board and check: the sensitivity of the radio tuner has decreased. We're looking into it, and we've found the place where the microcircuit is leaking. We added a metal screen and laid out the board a little differently. We check, the radio is now ok, but the maximum current on the USB ports is not enough to charge the phone. We are looking into it, we found out the reason, and again we installed the board in a new way. We are checking if everything is fine with the radio and USB ports, but we found a new problem. And this could happen twenty more times. And this is not counting the problems with the software, there are also a lot of interesting things there.

Separately, I would like to say that creating a new product is always a compromise. A compromise between price and set of functions and properties, but not between price and quality.

Even when planning the release of a new product, we immediately assign it a place in the product line, set the maximum price and the desired set of functions or properties. And then we try to make sure that the price remains within the limits and that the quality does not suffer. For example, let's take the case. Plastic parts are cast into special molds, and each has a maximum surface angle above which it will be impossible to remove it from the mold without damaging the part. If the design of the device involves the use of complex shapes, then expensive composite molds are used: the cost of the mold itself will be higher, as well as the price of producing one part. If we are approaching the limit of the allotted budget, it would be better to change the body design to use a one-piece mold.

The same applies to the choice of components. Automotive electronics are subject to the highest requirements for reliability and resistance to external influences. If a home TV does not require operation in conditions of very low temperatures or high vibrations, then for a car radio with a display these are normal operating conditions. If you get into a car in winter at -20ºC, you won’t wait half an hour for the display to warm up and start showing something, will you? Therefore, when we choose, say, the same display, we can sacrifice resolution (put a regular display instead of a high-definition display to reduce the price), but this display will still work both at +60 and at -20.

In conclusion, I can’t think of any one product that had a lot of problems during its creation. With every product there are problems when they are launched on the market - without this we have never had one. But any problems can be solved. The main thing is to clearly understand what the product should be, and at all stages of development and production to control quality and compliance with requirements, including the budget. After all, a low-quality or too expensive product will not be sold.

6. We are faced with the fact that the product must be “flexible”

Igor Eremin, founder of the telemedicine service “Mobile Doctor”

When launching the MVP of our telemedicine platform, we were faced with the fact that the product must be super flexible in terms of customization, since insurance companies, banks, mobile operators and many others can be partners in telemedicine. And everyone has their own tasks and “wants” in terms of functionality.

The solution was to build into the service architecture a lot of “custom” things that were not activated until the first partner appeared from one area or another. For example, functionality for uploading monthly statistics on consultations, activated policies, recording, automatic calculation, and so on. This made development more expensive initially, but saved a lot of time and money in the long run.

7. The main difficulty was in the business model itself

Andrey Myakin, operating director and co-founder of TNOMER company

The biggest difficulty in entering the market was that there were no analogues to our business model. I’ll explain what’s special: the classic service retail model is designed to offer one service in general, for example, only major renovations of an apartment. We have about 50 services that cover all repairs in the apartment, in the house and on the site. That is, we strive to accompany the client at all his life’s turns: after renovating the apartment, we will build a bathhouse, after the bathhouse, a fence, a gazebo, and lighting on the site. Then renovations in a new apartment and so on.

At the same time, we are not a construction company, but a platform for three participants in the process: the client, the material manufacturer and the team. These three lines should not intersect with each other; we are the guarantor and representative. Rounding it all out is the TV channel of the same name, which is integrated into the business model to create trust and generate customers, but must exist separately and independently in order to grow an audience, and for this to produce interesting content.

We built such a complex model in about six months, and we are still optimizing it.

Another difficulty is television filming at the facilities that we are repairing. To show viewers the renovation as it is, we film the renovation process, accompanied by expert comments. And in small areas surrounded by 5 tons of various materials, filming is quite problematic. Therefore, it was necessary to create an interaction algorithm that would allow them to be carried out in such a way that it would not affect the quality and duration of the repair itself: find out in advance about the readiness of the facility, figure out where to put the cameras, how to combine the work of the film crew with the work of the construction crew.

8. It was difficult to convince clinics to work with us

Ekaterina Yakubchik, product manager of the DOC+ mobile clinic

We have a partnership system with clinics: through the application you can make an appointment with highly specialized specialists. There were a number of problems at launch, which will be discussed below.

Problem: finding good clinics

We care about our patients, so we carefully select doctors for our staff, train them and control the quality of each treatment. When we send clients to third-party clinics, we want to be sure that they will receive highly qualified medical care.

Solution

First, we researched the medical services market, where we paid attention to the business reputation of clinics and looked at reviews from clients and doctors. After that, we went to each medical institution as ordinary clients, and at meetings with the management of the clinics we found out how they find doctors and control their quality.

We checked each clinic ourselves. Like ordinary clients, they came to an appointment and looked at what the organization looked like from the inside: is it clean, does the receptionist communicate with you adequately, is the doctor a good person, does he not sell unnecessary services, does he conduct a full examination, does he explain his prescriptions. Then the diagnoses and prescribed treatment were assessed by our head physician.

Once the clinic is connected, it doesn’t end there. We selectively check the quality of medical care using medical records and take feedback from each client about the quality of service.

Challenge: Integrating Online Scheduling and Medical Data

We wanted to make the most convenient product for the user: you go into the application, select the doctor’s specialty, a convenient time and place, make an appointment, and after the appointment you receive all the data in the application. No calls to the clinic, no paperwork - everything is done through the application. This simplification of the patient’s life “complicates” our life: we need to integrate with the clinic’s medical information system in order to have access to their online schedule and receive the results of the patient’s appointment. Our IT resources allow us to do this quickly, but on the part of MIS (medical information systems) everything turned out to be more complicated.

There are two types of MIS: large players who supply their systems to other clinics, and small clinics with self-written MIS. For large MISs, we are a third-party company that is not even their client, which means that by default we are at the very end of the list of priorities. In the case of self-made MIS, clinics are not IT companies; for them this is a completely non-core story, and resources for any improvements are severely limited. Both the first and second can be understood, but for us integration has become a very serious obstacle.

Solution

In the end, the only strategy that worked was to be patient and constantly make contact until we achieve results. For example, it took us about a year to convince one of the largest players in the market, but in the end we gained access to a large number of partners. So just patience and no magic.

Introducing a new product from a construction organization to the market is a complex, multifaceted and sequential process. In this case, it is necessary to find the optimal solution that meets both the market requirements and the capabilities of the organization.

The introduction of a new product to the market allows a company to establish itself in a specific segment, maintain competitiveness, and expand sales. To reduce the risk of failure in the market when releasing a new product, it is necessary to model the decision-making process that ensures the choice of the optimal option for a new product, strategy and tactics for its sales.

In every work, especially creative work, there is always the problem of maintaining a balance between theory and practical experience. When introducing a new product to the market, many companies try to follow advanced theoretical developments, while any entrepreneur has his own experience of working in the market - both successful and not so successful. When launching a new product, to what extent should one rely on the methodology, and to what extent on one’s own experience? What tools are advisable to use?

We will try to find the answer to this question by considering several methods.

First, a little theory. In order to correctly navigate the market situation, an organization must correctly answer the following questions:

1) determine what product to produce;

2) choose a sales strategy;

3) determine the need for additional research to increase the reliability of the available information.

To solve these issues, it is proposed to use a decision-making mechanism, the multifactor system of which is presented in Fig. 2.3.

Initially, it is necessary to formulate the main goal that the company wants to achieve by releasing a new product.

Next, information is collected on the basis of which decisions will be made. When collecting information, you need to pay attention to the following nuances: it is necessary to consider all possible options for new products, the internal capabilities of the company and market conditions.

The multifactor system contains the following main stages of management decision making. It includes the selection of the optimal option for a new product (service), taking into account the potential capabilities of the company and the risk of each option depending on market conditions, takes into account the internal environment of the company, and analyzes the external environment, which consists of assessing risk based on information about the situation on the product market. The criterion for choosing the optimal option is the expected profit. First of all, the optimal marketing strategy for the new product is selected. Based on information about the probability of the occurrence of a particular market state, the possibilities of adjusting the strategy when the external environment changes are considered, the reliability of the choice of a priori probabilities of the occurrence of market conditions is checked when introducing a new product to the market, and the expected utility from clarifying these probabilities is calculated. For this purpose, a decision tree is built.

To launch a new product on the market, we will consider an organizational scheme for selecting options for a new product, taking into account the capabilities of the company. In this case, system analysis is performed in the following sequence:

Creation of a structural model of the system;

Construction of a matrix of relative assessments;

Calculation of the specific weights of each option and determination of priorities.

Creating a multifactor system involves studying the constituent elements and their relationships, grouping these elements according to similar properties and distributing them among levels depending on their subordination to each other. Elements of one level act as targets for elements of a lower level and at the same time are subordinate to elements of a higher level. It is advisable to carry out distribution by levels until it is convenient to compare the selected elements. At the highest level, a global goal is formed that they want to achieve when introducing a new product to the market (Fig. 2.4.).

At the second level, significant factors of the external environment are listed: the organization’s position in the market; provision of the company with all necessary resources; technical capabilities of the organization, etc.

At the third level there are more detailed factors that are supporting elements of the second level factors: the possibilities of product sales channels; availability of a specific type of resource; level of automation of technological, production processes, etc. At the lower level, selectable options for new construction products are presented.

Thus, an organizational scheme for selecting product options is formed based on the potential resource capabilities of the construction organization.

The matrix of relative assessments is based on an analysis of the internal environment of the company. It establishes, through comparison, the relative importance of elements at the same level with respect to elements at a higher level.

If all values of relative importance have certain properties, then by calculating the specific weights, it is possible to determine the priorities of the options. For the system shown in Fig. 2.4., we have the following sequence of actions and calculations.

Comparison of second-level elements relative to the main goal.

1. Comparison of elements of the third level relative to the second level.

2. Comparison of new product options relative to the third level.

3. To determine the priority of new product options, it is necessary to calculate the relative weight of each option relative to the main goal.

Among all the options, the one that has the maximum specific weight is selected, that is, the maximum value of the specific weight determines the most promising option from the point of view of the company’s resource capabilities. Sorting the obtained specific gravity values in descending order establishes the order of the remaining options for the development of new products.

Thus, an array of priority options has been formed. Consequently, the most promising version of the new product was selected, meeting the real conditions of the organization.

In the process of introducing new products to the market, there are many unpredictable moments and factors independent of the will of the company's managers that must be taken into account. These factors include risk, for which mitigation strategies are being developed simultaneously. The task is to choose from a variety of possible options a management decision with minimal risk. To do this, a table of probabilities of market states and utility is created, in which, for each selected option, the probability and utility for a particular market state are indicated.

Under objective market condition refers to market conditions related to a certain point in time, a situation characterized by the relationship between supply and demand, the dynamics of prices and inventories, the presence of competitors and their position, etc.

Under usefulness you can understand what result the company will have after selling new products, and the result must be expressed quantitatively. After choosing the optimal feasible option for introducing new products to the market, the company's management needs to make a management decision and develop a sales policy, market behavior tactics, a strategy for increasing market share and profit growth.

At the same time, it is important to obtain reliable information to make an objective decision. To reduce the uncertainty of the final result, you can consider and analyze the perspective of the company's activities using the theory of Markov chains and Bayesian decision making theory.

To use quantitative methods of analysis, you should create a utility matrix, on the basis of which the optimal sales strategy can be selected. It lists all possible and mutually exclusive, that is, independent, market states, as well as the chosen strategies and possible utilities.

First, the expected utilities of all strategies are calculated, and then the maximum one is selected.

Due to the constant volatility of the market, the company faces the question: how to change its strategy so as not to fall into a crisis situation? In the process of quantitative forecasting of the market situation, it is advisable to use the Markov chain apparatus. The use of this device allows you to make a decision in advance when the market condition changes. The forecasting process uses the transition probability from one state to another.

Any change in some market state will almost certainly lead to a change in utility, that is, it will bring additional profit or loss. These utilities are recorded in the following matrix, which is called the transition utility matrix.

Based on the transition probability matrix and the transition utility matrix, a decision-making matrix is constructed when market conditions change.

Using the information from this matrix, you can find out which strategy should be used in a certain period and in a selected market state.

In the practical marketing activities of a company, it is often necessary to compare the costs of obtaining partial (incomplete) information and the costs of finding additional new information in order to make a better management decision.

The manager must evaluate how much the benefits obtained from additional information cover the costs of obtaining it. In this case, Bayesian decision theory can be applied.

When new information is received, the expected utilities of each strategy are calculated, and then the strategy with the maximum expected utility is selected. With the help of new information, the decision maker can correct prior probabilities , and this is very important when making decisions.

The results of marketing research cannot be absolutely reliable, namely, they cannot exactly coincide with the true state of needs for a given product. Therefore, decision makers use hypothetical different probabilities of coincidence of the obtained marketing research results with the true state of market demand.

The methodology for making management decisions on the launch of a new product seems interesting (Fig. 2.5). Let us describe the model of the management decision-making process for introducing a new product to the market in stages.

Block 1. At this stage, the idea of a new product is formalized.

A description of the product is drawn up, its distinctive features, nuances of technology, competitive advantages are indicated - everything that will allow it to find its niche in the market.

Such a description is usually does not contain exact characteristics, such as weight, size, color, etc. Rather, when formalizing the idea, ranges are indicated according to the specified characteristics and consumer qualities are formulated, for example taste, smell, usefulness, convenience, etc.

Here, to a first approximation, we describe differences between the new product and its analogues or direct competitors.

After compiling a product description, it is necessary to analyze it places in the company's current assortment: which products the new product will replace, which ones it will complement. This analysis often leads to the timely refusal to release a new product: for example, because it displaces the most profitable or successfully sold one available.

At this stage, a decision may be made to implement an idea in the form of a separate business.

It is very important, even before launching full-scale product research, to understand what place it will have in the company’s assortment. It is at this stage that the first significant screening of ideas occurs: out of 10-20, 2-3 remain.

Formalization (description according to the diagram) – preliminary requirements (wishes) for sales, production;

Consumer properties of the product;

Planned differences from competitors, etc.;

Comparative sales modeling.

Block 2. Initial study

This block is formed request for market research and technological development of a new product. In this case, the research can and should be small, low-budget, but providing answers to precisely asked questions: how will buyers react to the new product, how much are they willing to pay for it, what analogues are offered by competitors?

At the same stage, it is necessary to determine possible options for the technologies used, as well as explore the limitations and capabilities of existing production, the need to purchase new equipment, recruit new qualified personnel, etc.

The combined results of these two studies will give assessing the prospects of working with a new product On the market. It often happens that existing production cannot produce a new product at acceptable market prices, and re-equipment is too expensive.

The analysis will make it possible assess the real capabilities of the company – both internal and external - on the withdrawal of this particular product and discard it in a timely manner, saving a lot of money. In this case, it is better to spend tens of thousands of rubles on research than to lose millions of rubles on equipping a new production facility, relying on intuitive proposals.

Rice. 2.5. – Model for making management decisions on bringing a product to market

In addition, at this stage a decision may be made to place a new product in one of the existing production facilities, to find and analyze the capabilities of a potential supplier, to market possible alternative channels, etc.

Methods/tools used:

Request for marketing research (technical specifications) – parameters, criteria, completeness and depth, resources, deadlines;

Marketing research - methods are selected depending on the specific request and product: open sources, sample surveys, etc.;

Production diagnostics – modeling of capabilities.

If a decision is made to produce a product outside of our own production, it is necessary to obtain prototypes of the future product , manufactured in accordance with technical specifications, and not “model samples” of the manufacturer. At this stage expedient send engineers or technologists to future production so that they can analyze not only the quality of the resulting product, but also quality of organization of its production.

At this stage, real production possibilities are analyzed, the cost of a new product is modeled, and its economic feasibility for the company is determined.

Upon completion of this stage, a decision is also made on the advisability of launching a new product into mass production.

Methods/tools used:

Technical specifications (TS) for the product - technical and technological characteristics, requirements for raw materials, materials and equipment, restrictions, etc.;

Examination of samples - expert assessments, “focus groups”, “quality circles”, etc.;

Cost calculation - in accordance with accepted accounting standards and rules; accounting for overhead costs, variable costs, etc.

Additionally: "trial sales". Sometimes, for completely new products on the market, it makes sense to prepare and conduct so-called “test sales”.

This method is very often used by trading companies - they have the term “take it for testing.”

When organizing “test sales”, you need to draw up a precise sales program: what exactly do we want to test through this promotion? In no case should you set yourself the goal of selling a trial batch of a product with a planned profit - it is much more important to check the accuracy of the choice of packaging, price, promotion methods, and sales channels.

Methods/tools used:

“Test sales” program – tasks, conditions, methods, deadlines;

Organization of “trial sales” – logistics, instructing sellers, collecting information;

Analysis of results – it is possible to use SWOT analysis in a reduced volume.

Block 3. Clarifying research.

The tasks of this block of work: development of precise technical specifications (and technical specifications - TS) for the parameters and external design of the product, indicating the necessary technical characteristics (color, size, weight, etc.), determining the most effective sales channels and methods of promotion, clarifying the price range and obtaining other information necessary for drawing up a business program (business plan) for the launch and promotion of a new product.

At this stage, regular monitoring of the needs and preferences of the company’s clients, as well as the competitive situation in the market, is carried out. In addition, research in this block may be less expensive if the previous steps in the method have been worked out carefully and successfully.

At this stage, the following is determined: the product name, the main positioning parameters, as well as the most significant aspects of the promotion strategy. It should be taken into account that the work of this block is closely related to the next stage of bringing the product to the market.

Methods/tools used:

Request for marketing research (technical specifications) – parameters, criteria, completeness and depth, resources, deadlines;

Marketing research program – development, implementation:

Marketing research - methods are selected depending on the specific request and product: open sources, sample surveys, etc.;

Analysis of results.

Block 4. Trial production.

A very important stage, at the end of which it becomes clear to what extent the calculations coincide with reality. In production, this stage is also known as the “prototype”.

Product samples are made and undergo comprehensive technical and technological examination. Packaging options are being checked.

It is specified here profitprofitability (profitability) of the future product.

Upon completion of this stage, the product production technology, its weaknesses, and possible risks are clarified.

Block 5. Product launch (promotion) program.

The results of the third and fourth blocks of work (and sometimes “trial sales”) provide the basis for the development of a business program (business plan) for the launch and promotion of a new product. The detail and elaboration of this program depends on the specific situation: product, market segment, degree of saturation, etc.

For example, the program may consist of the following sections:

Description of the product (including its strengths and weaknesses);

Product positioning;

Sales markets and target audience;

Sales policy (including a description of the “ideal” buyer);

Sales channels (existing, new);

Sales promotion (tools used);

Individual special marketing projects and their implementation (special projects aimed at promoting a new product, for example participation in an exhibition, “promotions”, etc.);

Trading conditions (relationships with customers) and pricing policy;

Marketing budget.

When developing the program, all available information from the market and production is checked again, and calculations are clarified. Ideally, the program should undergo examination.

It is quite possible that experts will find significant flaws in it that will force them to either return to previous levels or even abandon the release of a new product.

The most loyal clients, independent market specialists, partners, management and marketing specialists and consultants can be involved as experts at this stage.

Methods/tools used:

The structure of the promotion program – the required volume, degree of detail;

Program examination – expert assessments, results of “trial sales”, customer surveys, etc.;

SWOT analysis – the presence and content of winning promotion strategies.

Block 6. Bringing the product to market.

Based on the program obtained in block 5, a detailed work plan with a new product is built for the marketing and sales departments, accordingly the production plan is adjusted.

According to experts, for a period of one to two years, a new product should be in the area of close attention of all top managers. Constant monitoring of the situation will allow timely identification and correction of errors and inaccuracies. This minimizes the risk of failure with a new product. But there will always be mistakes and blunders, since even the most large-scale and expensive research does not provide a one hundred percent guarantee of success.

The method is considered effective allocation of a separate “product manager”, assigned to a new product. The entire “chain” should be in the area of his attention and control - from the purchase of raw materials to final sales. The task of the “product manager” is to promptly inform management about any cases, when the actual development of the situation deviates from the planned plans and indicators. It would be logical to tie his salary to the results of serial sales of this product.

Methods/tools used:

The structure of the promotion program – the required volume, degree of detail;

The production plan is dynamic, including an adjustment mechanism;

Cost adjustment program - based on actual labor costs;

Algorithm and plan for launching the product into production;

Distribution of control functions - for the period of launch and delivery to “design capacity” of a new product.

Consideration of methods allows you to break down the entire project to launch a new product into separate stages, after each of which a decision is made to move forward with the project or exit it.

Each stage has a certain cost and a specific result. Depending on the situation in the company and on the market, one or another stage of the product can be significantly reduced or skipped altogether.

The concept outlined here for bringing a new product to market requires some ingenuity in putting it into practice and making real improvements in the company's work on new products. Answers to vital questions “how?”, “in what way?”, “in what ways?” not so easy to generalize. A new product launch program that is successful in one case may be unsuitable, and often dangerous, in another. That is why we focused on the fundamental steps - the stages of the project to bring a new product to the market. The presented diagram is a general algorithm for working on a new product. It takes into account most of the “commandments” and allows you to remember them. For complex situations (an innovative product, a saturated market, etc.), the diagram can be detailed and supplemented with other necessary blocks.

Prostova, N., Renard, A. Launching a new product on the market // Journal of company management. – 2005. – No. 10 (53).

The success of modern business organizations largely depends on the quality of strategic planning and management. The ability to timely and effectively plan and update the product portfolio serves as the basis for the competitiveness of the enterprise and the products it puts on the market. No company producing products for consumer markets will be successful over a long period of time without taking steps to develop and improve its products. This need is due both to the existence of the life cycle of each individual product, which must be monitored and adjusted as necessary and possible, and to the constantly changing needs of consumers of goods. In addition, various external environmental factors can cause changes in the market activity and product policy of the enterprise.

New products may vary in nature and origin. The classification recognized in world practice is presented in Figure 1.

Figure 1. Classification of new product varieties

Shorter deadlines (due to the unstable, too rapidly changing economic situation, and the weakness of strategic planning of organizations);

Making decisions to create a new product at the will and order of management, and not based on the results of an assessment of conditions and necessity;

Priority of the product over the consumer during development (basically, the target group is selected later, for the finished product);

Focus on Western models and copying them;

- “pseudo new” products (production of cheaper products by reducing production costs, reducing the number of ingredients or replacing them with cheaper analogues);

Taking into account the preservation of state regulation and socio-political interests in a number of sectors of the national economy, the operation of national economic development programs;

Massive import substitution of products on the market.

The strategy for developing and introducing a new product to the market includes nine main stages, presented in Figure 2.

Figure 2. Stages of a new product development and launch strategy

First of all, the relevance of a new product and its success in the market depends on the correct choice of search direction. Choosing a destination serves four main purposes:

1. Defines the area in which development should be carried out,

2. Helps direct the search efforts of all company structures,

3. Focuses the attention of developers on the assigned tasks,

4. The need to develop directions acceptable to all members of management contributes to their advance thinking.

Idea generation is a systematically organized process of searching and generating ideas for new products. In 2014, experts from the scientific and socio-political journal of the Russian Academy of Sciences “SotsIs” conducted a survey of managers of research departments, during which the frequency of new ideas passing through further stages of development was determined. The survey results are presented in Figure 3.

Figure 3. Percentage of new ideas progressing to further stages of development

Among the most common methods of generating ideas and used in companies are: the method of listing features, forced combination, morphological analysis, identifying the needs and problems of consumers, brainstorming (storming), synectics.

The idea selection stage aims to identify suitable proposals and reject unsuitable ones. In the initial assessment of proposed new product projects, it is necessary to answer questions regarding the benefits that consumers and society will see in them, the benefits to the company, the compatibility of the project with the goals and strategy of the company, the complexity of its development, advertising and distribution.

The next stage of developing and testing the concept of a new product involves creating a system of basic guiding ideas of the manufacturer about the product being created, its market opportunities and characteristics and testing the impact of this concept on groups of target consumers.

The development of a marketing strategy is based on the creation of a system of marketing activities through which the company intends to achieve planned sales and profits. The structure of the strategy presentation is presented in Table 1.

Table 1 – Structure of the presentation of the marketing strategy for a new product

After the concept and marketing strategy of the product are formulated, more specific questions arise about the likelihood of the actual sales volumes, market share and profits from the sale of the new product being planned in the project. This probability can be assessed by economic or business analysis.

Business analysis is a more detailed assessment of a new product idea in terms of required investment, expected sales volumes, prices, costs, profit margins and projected return on investment.

Economic analysis of an idea includes forecasting costs associated with product development, entry into the market and sale, assessment of competition and sales volume, profitability analysis and consideration of uncertainty and risks.

If a new product successfully passes the business analysis stage, it moves into the prototype stage, during which it turns into a real product. At this stage, it will be determined whether the product concept can be translated into a product that is profitable, both from a technological and commercial point of view, and whether the ideas contained in it are feasible in practice. Finished prototypes are tested. Prototypes that successfully pass the test for quality and reliability move to the trial marketing stage, where they are tested under conditions close to market ones.

As part of a new product development and launch strategy, the test marketing phase is one of the most important components and should not be ignored. It is a transitional link, meaning the completion of development and preparation for the launch of the product. Companies that pay insufficient attention to test marketing, or want to save time and money by neglecting it, end up losing disproportionately large amounts of money after introducing an untested product to the market in full, when changes can no longer be made or it costs enormous effort and expense. In addition to the ability to assess consumer reaction to a new product and make the necessary adjustments, test marketing allows you to select the most appropriate and effective marketing tools and distribution channels for use at the commercialization stage, after first verifying their effectiveness. When using test marketing, consumer product companies typically choose one of three methods—standard, controlled, or simulated test marketing.

In case of a positive decision based on the results of trial marketing, the project enters the commercialization phase. The commercialization stage means the development of mass production and the release of a new product to the market, which requires significant costs. When introducing a new product to the market, it is necessary to have clear decisions on the four issues presented in Figure 4.

Figure 4. Contents of issues that need to be addressed when introducing a product to the market

Towards the end of the product development process, during which sales are zero and costs are increasing as the final stages of the process approach, the product enters a new stage of the product life cycle - introduction to the market, usually accompanied by a gradual increase in sales volume. The beginning of the stage is the first appearance of new products on sale. Even if a new product is very successful, it takes time to conquer the market. Significant funds are needed to attract distributors and create warehouse stocks.

When introducing a new product to the market, a company can adopt one of several strategies. The enterprise can adjust the level for each of the variables - price, promotion, distribution and quality of the product. Recommended strategies for introducing new products to the market are presented in Table 2.

Strategy	Variable level	Meaning	Conditions of use
Gradual extraction of maximum profit	The price is high, Sales promotion costs are low.	A high price helps extract maximum profit per unit, and low promotion costs reduce overall marketing costs.	Small market size and buyer awareness of the product, with their willingness to pay for it. A small number of competitors.
Accelerated extraction of maximum profit	High level of price and sales promotion.	Allows you to expand the circle of informed consumers, contributing to sales. Revenues must cover stimulus costs.	The market is small, the majority of buyers have little understanding of the product, and measures are needed to alert and convince them.
Accelerated market penetration	Price is low, sales promotion costs are high.	Ensures the fastest and most complete conquest of the market and capture of its highest share.	The market is large, buyers are price sensitive, unfamiliar with the product, and competitors are dangerous. The lower the scale of production and the richer the experience of the company, the lower the costs.
Gradually conquering the market	Weak sales promotion, low price.	Systematic introduction of a product to an existing competitive market with low capabilities and low ambitions of the company.	Limited finances do not allow spending large sums on withdrawal.
Average market penetration parameters	Average price level and average sales promotion.	The product is intended for the middle class, does not try to stand out, competes on the basis of quality, the emphasis in advertising and positioning is on high quality at an affordable price.	Mainly in the market of necessary goods, when targeting buyers who are more responsive to quality rather than price, and are also sufficiently knowledgeable and have some idea about the product.

The company chooses a strategy for introducing a product to the market in accordance with the intended positioning of the product. Choosing a strategy for the product launch phase is the starting point of the entire product life cycle plan. The company focuses its sales on those customers who are most ready to buy and holds events that allow them to try out a new product or interest consumers in it.

As world practice shows, a fairly small proportion of new products are commercially successful. According to some experts, only 20% of innovations are successful in the market.

The reasons why new products fail are usually:

Lack of a clear and adequate concept of the new product;

The product solves technical and technological problems without satisfying the basic needs of the consumer;

Poor coordination of efforts between employees and departments when launching a new product;

Management’s expectation of an immediate financial effect from a new product, unpreparedness for long-term investment and promotion;

Low quality of goods;

Incorrect pricing policy;

Late launch of the product to the market;

Weak distribution and lack of marketing support measures for sales.

Factors that make it difficult to develop new products include:

Short life cycle of goods and technologies;

Existing state regulation of innovation processes;

Significant amount of required capital investment;

Relative similarity of basic technologies for enterprises in certain industries;

High costs for product development and implementation.

The key success factors for new products are:

Superiority of the product (the presence of unique properties that bring additional benefits to the buyer, promoting better perception and interest);

Marketing know-how (better understanding of the market, development focus on the market and the client);

Technological know-how.

In addition, success factors include: intensive primary analysis, precise formulation of the concept, development plan, control of all stages of introducing a product to the market, access to resources, time factor, as well as a correct assessment of the degree of risk.

Thus, when forming a strategy for the development and launch of a new product, it is necessary to take into account all the success factors and reasons for failure discussed above, as well as a thorough study of the stages of product creation and the choice of tactics for introducing it to the market, corresponding to its positioning and the established level of price and sales promotion. The combination of these measures and a strategic approach to the processes of developing and introducing a new product to the market contribute to:

Http://socis.isras.ru (access date: 03/31/2016)

Izmalkova S.A., Tronina I.A., Tatenko G.I., Magomedalieva O.V., Laushkina N.S. Strategic analysis: modern management concept: a textbook for higher professional education. – Orel: FSBEI HPE “State University-UNPC”, 2013. – 315 p.

Izmalkova S.A., Tronina I.A., Tatenko G.I. Strategic management and marketing/textbook. – Orel: FSBEI HPE “State University-UNPC”, 2011. – 325 p.

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How to introduce a new product to the market. Encyclopedia of Marketing Introduction of a new product to the market

1. Launch of a new product accompanying the old one

2. Release of non-core products for traditional consumers

3. Release of new products that do not correspond to the company profile and are aimed at capturing a new market

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How to make the most of a new product launch: checklist

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Part one. Manuscript found in mailbox (electronic)

Part two. Examples and counterexamples

Part three.

Part four.

Part five. Let's sum it up

2. We were not prepared for high demand

3. Clients did not understand the logic of pricing

4. We wanted to receive money immediately (but it didn’t work out)

5. Launching a new product is a lottery

6. We are faced with the fact that the product must be “flexible”

7. The main difficulty was in the business model itself

8. It was difficult to convince clinics to work with us

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