{"id":12,"date":"2017-05-23T04:59:30","date_gmt":"2017-05-23T04:59:30","guid":{"rendered":"http:\/\/innovaxis.wpengine.com\/?p=12"},"modified":"2022-04-27T16:53:09","modified_gmt":"2022-04-27T21:53:09","slug":"new-product-development-do-you-feel-lucky","status":"publish","type":"post","link":"https:\/\/www.innovaxisinc.com\/de\/b2b-marketing-strategy-blog\/new-product-development-do-you-feel-lucky","title":{"rendered":"New Product Development: Do You Feel Lucky?"},"content":{"rendered":"
\n

\"Market<\/p>\n

It happened again. We’ve observed another software vendor that released a new product that has generated almost no sales
\nin the first year and which faces an increasingly grim outlook.<\/p>\n

How
\ndoes a vendor with an otherwise successful track
\nrecord in their bread-and-butter market fail so miserably?<\/p>\n

The answer is a lack of insight into both
\nchannel and end-user requirements\u2014insight that could be
\nobtained through primary market research<\/a>.<\/p>\n

We’ve seen this scenario play out time and time again, with millions wasted and many people fired. Two
\ninstances come to mind where products were launched with no evidence of market or channel demand, only to see them fail.<\/p>\n<\/div>\n

Does This Sound Familiar?<\/h2>\n

The first example comes from a software vendor
\nwhose engineers came up with an interesting
\nconcept that was a spin-off of a successful, narrowly
\nfocused product. Internal discussions probably went
\nlike this: “This is cool. It certainly satisfies the needs
\nof its existing users. Let’s develop it for a broader
\nmarket and get sales to sell it.”<\/p>\n

Because the software vendor is more engineering than
\nmarket-driven, little or no feedback was likely
\nobtained from the reseller channel or from end-users.<\/p>\n

As a result, the vendor was totally surprised
\nwhen it found its channel wasn’t interested in the
\nnew product. Turns out, one reason was that the
\nselling price was lower than the vendor’s other
\nsoftware products, and resellers wouldn’t make a
\nhigh enough margin to make it worth their effort to
\ntake it on. And, end users weren’t interested
\nbecause the software simply didn’t meet their needs.
\nIt was the classic case of a solution in search of a
\nproblem.<\/p>\n

Common Fallacy: High-End Features Equate to Value in Low-End Models<\/h2>\n

In another instance, a hardware manufacturer was
\nintroduced with functionality previously only seen in
\nhigh-volume models. While this is certainly a nice
\nidea, there were two problems.<\/p>\n

First, the company’s
\nown salespeople, as well as its channel partners,
\nmade more on selling a single high-volume models than 50 low-end models.<\/p>\n

Second, users of low-end models did not see the same value in the “high-end”
\nfeatures that high-volume users did.
\nAdditionally, the form factor of the new unit was
\ndeemed inferior by users, which was significantly different when compared to the
\nform factor of other low-end models.
\nIn neither case did these vendors talk to their
\nchannels nor end-users before releasing new
\nproducts.<\/p>\n

The Result:<\/em> millions of dollars were wasted
\nproducing and marketing products that no one
\nwanted to sell or buy. It took over three years to sell through the mountain of inventory in the warehouse, and at fire sale prices. Every day, the CEO walked past that mountain and grew increasingly upset.<\/p>\n

Note:<\/em> it is<\/em> possible that high-end features do have value in low-end models \u2013 just not always.<\/p>\n

Market Research Equates to Insurance<\/h2>\n

Investing money in market research is like buying
\ninsurance on new product development.
\nUnderstanding what salespeople will sell and end-users will buy is information that can be obtained
\nthrough primary market research\u2014in other words,
\nasking people a structured series of open-ended
\nquestions that seek both quantitative and qualitative
\ninformation.<\/p>\n

We know:<\/em> insurance is not sexy, but new product development equates to gambling and doubling your growth rate with a successful new product that’s easy to sell and profitable is very sexy…<\/p>\n

The Industry Analyst Trap<\/h3>\n

Some vendors confuse analyst reports as market
\nresearch. While industry analysts do talk with
\nvendors, their main shortcoming is that they do not
\ntriangulate their findings with information collected
\nfrom channels or users. Thus, there are no checks
\nand balances to information obtained from
\nvendors\u2014whose best interest may not be served by
\nsharing sensitive sales information that will be
\naggregated and sold to their competitors in the form
\nof industry reports. Additionally, analyst information
\nis reported at a macro level while vendors seeking to
\nlaunch new products typically need information at a
\nmicro level, which is almost always only available via
\ncustom research.<\/p>\n

Internal Market Research vs. Outsourcing<\/h3>\n

Market research can certainly be conducted
\ninternally, but that is a tough row to hoe. Vendors
\nneed experienced people that can set aside several
\ndays at a time to hit the phones\u2014and do nothing
\nelse. I have taught subordinates, co-workers and
\nstudents how to perform this research. It’s usually
\npainful at first, and it may not get better.<\/p>\n

While hiring an experienced market research firm
\ncan be a significant investment, it’s often a far better
\noption, in terms of quality and the avoidance of
\npain. Just make sure to hire one where the people
\nmaking the calls are both experienced and involved
\nin the analysis. Many firms will blather on about
\ntheir methodology only to outsource their work to call
\ncenters better suited for telemarketing or consumer surveys than
\nbusiness-to-business (B2B market research).<\/p>\n

The Truth Be Told…<\/h2>\n

It’s true that some vendors get lucky and hit a
\nhome run without doing any market research.<\/p>\n

So,
\nwhen launching a new product, in the words of Clint Eastwood\u2019s Dirty Harry, “You\u2019ve got
\nto ask yourself, do you feel lucky? Well, do you?”<\/p>\n

Contact us to learn more about primary market research for new product development <\/a><\/p>","protected":false},"excerpt":{"rendered":"

\"Market<\/p>\n

It happened again. We’ve observed another software vendor that released a new product that has generated almost no sales
\nin the first year and which faces an increasingly grim outlook.<\/p>\n

How
\ndoes a vendor with an otherwise successful track
\nrecord in their bread-and-butter market fail so miserably?<\/p>\n

The answer is a lack of insight into both
\nchannel and end-user requirements\u2014insight that could be
\nobtained through primary market research<\/a>.<\/p>\n

We’ve seen this scenario play out time and time again, with millions wasted and many people fired. Two
\ninstances come to mind where products were launched with no evidence of market or channel demand,<\/p>… Continue Reading >><\/a>","protected":false},"author":10,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[45,64],"coauthors":[],"class_list":["post-12","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-market-research","tag-product-development"],"acf":[],"yoast_head":"\nDo You Feel Lucky? | Innovaxis B2B Marketing Agency<\/title>\n<meta name=\"description\" content=\"New products developed without understanding market and channel requirements often fail - here's why\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.innovaxisinc.com\/de\/b2b-marketing-strategy-blog\/new-product-development-do-you-feel-lucky\" \/>\n<meta property=\"og:locale\" content=\"de_DE\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Do You Feel Lucky? 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