5 Powerful and Easy Ways to Product Success
“The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” – Peter Drucker, Management Consultant
Each day countless numbers of new products enter the market. What determines their success or failure has a lot to do with proper planning and marketing. These five simple tips will give you a great basis for developing your next launch.
1. Meet Customer Demand
Does the product answer unmet needs of the consumer?
New product lines should focus on solving a problem or addressing a need in a new or different way. Apple, for example, has historically proven itself as a company that recognizes consumer needs ahead of everyone else. From personal computers, portable MP3 players, and smartphones, Apple created new product markets and addressed a real customer need. Some even say it created the customer need “out of thin air”. Find creative and innovative ways to an answer those needs within your industry.
2. Identify the Target Market
Design and market a product that will sell to potential buyers
Prior to the launch of your product, understand the target demographic. Find out the needs and “pain points” of those potential buyers, and how your product can answer those needs on a budget. Test the product among members of that demographic to discover which aspects of the product appeal to them. Understanding the specifics of a target market allows you to tailor the functionalities of the product, marketing strategy, and distribution channels so your product will make a greater impact.
3. Capitalize on the Weaknesses of the Competition
Will consumers choose your product over the competition?
Understand your competitors and design a product that stands out from the competition. The failure of BlackBerry Playbook demonstrates how a competing product must offer very real, differentiating improvements to steer users away from the competition. Blackberry released the Playbook as an answer to other table devices like the iPad. However, its expensive price tag, weak battery life, and inferior app store selection led Blackberry’s tablet device to tank. Take a lesson from Blackberry. If you plan to release a product similar to ones that already exist, make sure it outdoes the competition.
4. Start Small, Think Big
Develop a product with the highest return on investment versus risk.
Develop a Minimum Viable Product which has the greatest return on investment with minimum risk. Start small by developing a product based on core features with a lower investment risk. Test the product with minimum resources and reduce wasted spending. Results from the initial launch of a basic product will allow you to evaluate if it will succeed. Take for example the Symphony by Lotus, a product that overstuffed the features of Excel, PowerPoint, and Word into a single software. Less is more when it comes to developing a product in its initial stages so stick with the basics before expanding the product vision.
5. Plan the Product Life Cycle
Adapt your marketing strategy as the product matures
The first phase leading up to product release will need to change as the product matures. Start out with introducing and educating the customer base about the new product. Continue to monitor marketing results carefully and adapt the campaign accordingly. Recognize if and when the product or marketing strategy needs to improve or expand. For example, after the initial release of Walkme, an interactive and online engagement platform, the company continued to expand its product offering so that it would appeal to a larger market base including customer support managers, training professionals, sales management, SaaS providers, and UX managers.
When it comes to launching a new product, planning and flexibility will allow your product to succeed. Research your customer base and the competition. Develop features that appeal to the target market, but set your product apart from its competitors. Aim high, but stick to simplicity that will lead to a greater return on investments versus risk. As the product matures, continue to monitor results and adapt the product and marketing approaches accordingly.
Now that you’ve learned a few tricks to achieving product success, it’s time to calculate one of your SaaS metrics — your Net New MRR — to see how you’re doing in numbers. Say you calculate your MRR by multiplying the total number of your paying customers by the Average Revenue per User (ARPU) per month. So, 600*$167/mo = $100,200. However, this number doesn’t tell you how that number expanded or contracted over previous months. If your MRR grew by $5000, you’re going to want to know from where. Net New MRR tells you from where because it not only takes into account new revenue, but also account upgrades, downgrades and churn. For that reason, Net New MRR is more informative and predictive of future growth than regular MRR. Use the Calculator below to help you measure your Net New MRR.
Does your MRR account for expansions, contractions and cancellations?