How Market Research Determines New Product Success
You have invested countless hours into building your business. Things are going well. You have connected with the right clients, your sales force is humming along, and you have figured out your sweet spot for your products and services. Congratulations!
It is time to ask yourself: Am I providing a product or service that never changes or is a standard part of a consumer demand? If the answer is not a resounding Yes! then you must determine how to appeal to new customers or increase your value proposition to existing customers in order to survive long term.
Determining what to offer as a new product or service might seem simple. After all, you are successfully doing it now, right? But your idea must addresses an unmet need in the marketplace, or the idea may not be viable.
Where do I start?
That is where market research comes in – taking the time to thoroughly plan and research a concept before moving forward. Market research can be invaluable when it comes to helping you determine your idea’s potential. Research involves determining several key factors:
Is there a need for this product or service?
Is there competition?
What would a client be willing to pay for the product or service?
How will you reach potential clients?
How do I know if there a need for my new product or service?
An idea that is designed as an add on to an existing product or service appears that it would be an easy sell. Business owners can sometimes be handicapped from being so close to the business. Emotional ties can hide the truth – is this a product that fits a true customer need?
Where can I get preliminary feedback on a proposed product or service?
The fastest and easiest way to get honest feedback is to go to those who already buy from you. Your customers are your biggest asset in market research.
Talk to your customers about how they use your current product or service by asking some preliminary questions:
- Are they using it the way you anticipated?
- Are they modifying it to more closely fit their business practices?
- What are some of the things that they wish your product or service could do?
Would my current customers buy it?
After hearing how your customers use your goods, talk to them about your idea. It may meet a need or help them expand their business. This type of research helps you understand if the new product or service is something that can be sold in a new marketplace or is it mainly an add on for existing clients. Ask the price they would be willing to pay for it. This will indicate the benefit/cost to them and give you an idea of what your margins could be.
Is my competition already doing this?
The next step is to take a look at the marketplace for ideas that are similar to your concept. If competition exists, identify how it differs from your concept. Evaluate what is already out there. Look at quality, functionality, and marketing. The customer service level of the competition could be creating a need for the same concept delivered by a different player.
Another useful approach is to prepare a SWOT analysis. A SWOT analysis can be used to evaluate a product, business, or industry and is usually prepared by an internal team through extensive discussion and feedback.
Strengths of your product or service
Weaknesses of your concept
Opportunities that are available with the products or services
Threats that could thwart the success
With all of this information available for review, a SWOT enables you to analyze the potential of your idea.
How will my customers find out about the new product or service?
One of the elements of your research should also include how you are going to reach customers. Do you have an inside sales department that is structured in a way that can support your initiatives? A new product or service may also require taking an in-depth look at your company’s sales process. Is it time for new ideas or techniques to help you reach your target audience?
Many businesses are looking at expanding their reach by using sales channel partnerships. Sales Channel Management is a process in which a company creates specific programs for reaching customers by using a sales vehicle such as the internet. Channel Management can positively impact the reach of your business.
To determine if your idea is a viable one, you must take the time to evaluate everything. Market research can be daunting, but it takes the guesswork out of whether or not your time and investment will allow you to accomplish your objectives and goals.
Chameleon Group does the heavy lifting for you.
Chameleon Group provides customized solutions for B2B development based on your specific needs. Because we have the experience to identify key opportunities for growth you can have confidence that you will minimize risk and maximize success. Utilize the experience from our proven track record in creating specialized sales teams and customized programs. After all, you want to spend your valuable time on business development, focus your efforts, and improve your bottom line.
Want to talk more? Reach out using our contact us form and we can talk about your options for business growth. It is always a good time to succeed.