When you are planning to launch a new product in the market, there can be nothing as important as considering market potential of the same. Although bringing new product into the market might be important to keep up with changing demands of your consumers, making hasty decisions to do so should be the least thing in your mind.
There are many aspects that must be tested well before you get ahead with your new product development. You are upgrading an old product or introducing a new into the market to enhance your profit. Thus, evaluating the market is the most important factor. A good research means a successful product. Tools like testing concepts, testing prototype, testing markets and focusing of the needs and demands of your consumers all contributing determining the market viability of the product you plan to develop and launch.
This process can be complex, time consuming and expensive. Especially, if conducted in-house. Experts often suggest that such research and development should be conducted by a different company. Here are a few things you need to consider to determine whether there is a commercial market for your new product or not.
After you have found the answers to the above mentioned questions, you must move on to test the tactical aspects of new product development. You need to have an efficient and clear evaluation process to ensure that your product performs well in the market. Here is how you can do so:
If you think that your product has the “ok” factor, you must remember that you being okay might not deliver. The actual litmus test is whether your product is sustainable enough to bring the effective ROI. You must make sure that is your product is selling an USP it must be able to deliver the USP that you claim. Marketing to a certain need and then failing to deliver might spread negative sentiment and impact your image.
Understanding the customers and checking its prospects in the market is a very important step. A product or service that lacks a demand is unlikely to be successful. And, more importantly, you might lose your investment without earning any profit at all. Test the market well to check whether your concept or idea is viable enough to replace the prior product or fill the demand of new product. You need to assess the viability on a deeper level considering all the aspects like quality and scale.
Review the product or service that is already in the market on criteria like price, availability, reliability, etc. This will help you to compare the existing product with the new product or service that is being developed. If you are introducing a new product or service altogether with no matching counterpart you can make estimates. This step will allow you to see whether there are any alternatives that you can consider or alterations in the current idea or concept.
If the life span of your product is expected to be limited, you will not be able to recover even the well-managed cost base set up. A new product with longer life span expectancy offers greater opportunities in terms of sales and profitability.
In case you are in an actively growing market, a product that offers you stagnant sales might just pull you backwards. Thus, you need to turn your focus on creating new products or services that offer dynamic growth potential not stagnant ones..
There will be flow of impacts and effects after a new product is introduced to the market which you need to consider. Basing your new product viability reports on the present market conditions alone can be dangerous. You need to evaluate and estimate market response toward your product keeping the future in mind.
ROI is a very important factor in both new product development and new product assessment procedures. Your cost, pricing and returns are critical element. After all, it’s profitability that matters at the end.
Apart from the above mentioned points, you need to also check the capacity and capability of the new product that you are developing. There must be a well-planned exit plan in case the new product concept or ideas doesn’t work out well. A research and development company can assist you throughout the whole procedure and help in making your new product a success.