The Right Way To Launch A Successful New Product

Author

My Say, Contributor

September 19, 2014

The vast majority of corporate R&D is done by well-established companies investing in relatively low-risk, medium-return, N+1 (next-generation) products. These products and their business models seldom need more than a few tweaks. For development and go-to-market teams the N+1 process is quite routine.

The Challenge

Problems present themselves on big gambles: new products and markets. They bring new technology platforms, customers, use cases, and even channels. Despite the considerable resources and experience that established companies have, new product development is a heavy lift for any team.

Additionally, new-product teams – engineers, designers, marketers, and general managers – typically lack the shared, face-to-face customer experiences and layers of data it produces that they have with pre-existing products.

To address this, teams buy market research, conduct focus groups, do A-B web testing, and assign a marketer and technologist to interview prospective users. This produces a single-layer of survey data that the team uses to deduce their new product and business model.

The flaw in this process is that customers are not exposed to the results until beta or worse – at scale — when bad news arrives that’s too late to fix.

Some companies address deduction risk with market validation. They walk their business model and test-sell their product. What they test, however, is often visionary and vague and produces false-positive conclusions, the worst kind of result.

Prospects still didn’t see the product, its use cases, specs, limitations, roadmap, use cases, implementation requirements, support services, or price, all of which are common sources of bad news which only reveal themselves at purchase and first use.

Solving these problems takes a process and skillset that most N+1 teams don’t have.

Minimum Viable Product

Develop the Minimum Viable Product (MVP), that which has the highest return-on-investment versus risk. It’s the product that’s ‘big enough’ to sell in volume, with good margins, but not so big as to have exponentially increasing risk and investment with each new feature.

The MVP is also a mindset of the management and development team. It says, think big for the long term but small for the short term. Think big enough that the first product is a sound launching pad for it and its next-generation and the roadmap that follows, but not so small that you leave room for a competitor.

A team can be its own worst enemy when it comes to ‘minimal’. Their imagination, pride, professionalism, brainstorming, etc. heap one idea atop another unbounded by risk and investment considerations.

For example, Symphony from Lotus, the company that invented the spreadsheet was too big, the equivalent of Excel, PowerPoint, and Word in a single product. It failed and dramatically devalued Lotus.

Get on the Right Track in 90 Days Using the Scientific Method

Hypothesize the product and business model; design ways to test them, conduct tests, and pivot until you succeed or realize you’re doomed no matter what you do.

In other words, reverse the traditional development process: design-build-sell. Instead, sell-design-build. Sell the MVP that you plan to build, defined in every way possible using visualization and breadboarding tools, specifications, limitations, and a roadmap from version one to a long-term vision.

Sell and design iteratively. When prospects object to a hypothesized MVP, work out the kinks. As iterations abate, prospects will agree to become customers. That brings development funding and a team.

1. Check that You Meet Sell-Design-Build Prerequisites

Shun traditional market research and customer interviews. It only slows you down. Assume success and test sell. It produces few, if any, false positives or negatives.

Assign a small core team – GM, engineering, sales, and marketing − who can conduct sales-like customer meetings, face to face, on their premises. Give them authority to act within a defined strategic envelop, make them accountable for success, and have them analyze field results and plan next steps regularly with a board or management team.

Be sure the product (MVP) is at least 80% feasible by any measure (laws of physics, availability of resources, etc.) and that early, target customers are within three time zones of the core team. (Compromises are expensive and sometimes fatal.)

 2. Kickoff Meeting, Day One: The 3Ps — Prospects, Pitch, Product

Conduct a two-day, team kickoff meeting. The first morning, hypothesize market segments and customers by name, location, and decision-making team. For business products, target respected brand-name companies and list twenty.

That afternoon at the white board, hypothesize your MVP. Make it small enough that you risk embarrassing yourself. Create a question-based sales pitch. Start with a James Bond-like movie opening that grabs attention immediately:  “You had me on slide one.”

This quickly establishes your relevance and credibility and earns you the right to ask the customer questions − who, what, where, how, problems, and planned solutions.

Then, define your MVP ‘solution.’ Use images, callouts, screens, mock demos, specs, limitations, roadmap, installed footprint, justifications, pricing model, buying model, and wrap up. Pepper the pitch with trial-close questions (Who will use it?) to continually test where you stand with the customer. Close by planning the next meeting.

 3. Kickoff Meeting, Day Two: Set Two Customer Meetings

Drawing from your list of 20 prospects, set meetings with two companies’ Decision Making Teams: resource allocating VP, functional director, manager, one or two users, and internal support, two full weeks out.

Target easy companies first. Research a prospect, customize a script, and call. (Emails and referrals don’t work as well as calling.) Book meetings at 9:00 a.m. or 2:00 p.m. on Tuesday, Wednesday, or Thursday. Setting two meetings locks in “Wave One.”

4. Get the Meeting Or Get A Restraining Order

Meet with brand-name customers, not just people you know. If you have to explain who a customer is, it’s the wrong one. Resume calling. Start at the C-Suite level and get referred.

Calling requires a two-person team. Call during ‘prime times’: 7:30 a.m. to 9:00, 11:30 to 1:30, and the best, 4:00 p.m. to 6:00.

Clearly state your purpose, set a hook and close with, “How’s Tuesday at 2:00?” Explain that you’re bringing a team of five and why. Ask, “Who’ll attend on your side?” Send a confirming email, you’re first marcom.  Trumpet your product, team, and the value of the meeting to help your sponsor pull in her team.

5. Conduct One Wave Of Six Meetings Every Third Week

Block the core team’s schedules for roadshows (“waves” of six meetings) every third week. Prepare by doing team edits of the presentation, assigning meeting roles, and doing a dry run of the meeting. At meetings, take transcription-like, voice-of-the-customer notes. Don’t summarize or interpret. Tag the notes with problems, use cases, objections, etc. to make them searchable.

6. Pivot Your Way To Success (or redeployment of resources if doom is certain)

Debrief each meeting to assess volume, price, and margin potential. Iterate to better and better customers, DMTs, value propositions, MVP, and business model. Update senior management after each wave. Seek input. Use good news to get funding and recruit people and bad news to pivot.

One meeting per customer is not enough. Advance initial relationships with subsequent meetings synchronously as you develop the product so that when you’re ready to ship they’re ready to buy.

Make no mistake, the heavy lifting of “build,” where a lot can go wrong, is still ahead. But at least you know early, that the destination is worth it, and that you’re on the right track.

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