Although there is no golden rule on how to successfully market a product online, there are some key things that you can do to improve your chances of success. Unfortunately, although it takes time, money and effort to successfully create and launch a new product, this effort is not always rewarded by a receptive marketplace. Recent marketing studies have come to the grim conclusion that in the United States only 5% of new products profitably pass the five-year mark. The numbers within Europe are only slightly better with 10% of new products showing a profit within the five-year window.
cc licensed flickr photo shared by stevendepolo
In order to beat the statistics, here are five keys that market research shows can improve your chances of success:
Key 1: The Product Must Fulfill a Real Market Desire
Instead of creating a product that is in search of a market, you’re more likely to be successful if you first find a market need and then try to create a product to satisfy it. Occasionally, it’s possible to succeed by simply creating a product that delights customers instantaneously because it fulfills a latent need. Unfortunately, this is the exception rather than the norm.
Your chances of success will improve exponentially if you first do market research by finding ways to survey and talk to customers.
It’s best to first find an unfulfilled need and then create a product to fulfill it.
Key 2: Thoroughly Beta-test the Product before Releasing It
Although companies like Microsoft have managed to beat the competition by releasing their new operating system to market before their competitors and then fixing glitches as consumers discovered and reported them, this is a risky way of doing business.
What works for Microsoft will probably not work for a smaller company. Microsoft is able to get away with this tactic because they have a feedback loop that allows automatic reporting of errors in the software. They are also able to get away with this questionable way of doing business because they are able to spend millions on reputation management campaigns.
For a small to medium-sized business, this technique only results in consumer frustration and customer loss. Not only will customers choose to get their products from your competitors, but they will also be sure to tell other people how bad your product turned out to be.
Key 3: Prefer to Over-deliver than To Overprice
Customers part with money because they believe that your product offers them more value than the money they hold in their hands. When they find that you deliver more value than they paid for, they are both shocked and delighted.
Alternatively, when they find that your product does not measure up to their expectations, they feel angry and frustrated at having lost their money. Even if they are able to get a refund, it becomes a situation where nobody wins. The customer did not get the satisfaction they anticipated and you, the product creator, did not make a profit.
With the global recession, customers have become increasingly price-sensitive. It is now even harder to satisfy their expectations and their budgets. For this reason, it is necessary to do extensive research on what competitors are charging for similar products and what customer’s expectations are about the value they expect to receive.
If you get the equation right and manage to exceed their expectations, you will have customers who are eager to buy your next product. Winning a customer’s trust will earn their loyalty for a long time.
Key 4: Focus on Your Product’s Uniqueness
The more unique you can make your product, the closer you will be to having a monopoly on it. This can translate into enormous profits if the product fulfills an important need. However, your product should not be too unique. It should be somewhat familiar, yet different enough to stand out from the competition.
Again, do not follow Microsoft’s example in this. Microsoft is bringing out Windows 8. This is remarkably different from Windows 7, Vista, XP, and other earlier generation operating systems. This is a huge gamble because it forces people to step well outside the comfort zone. While this may work, a flop will result in huge losses.
Once again Microsoft is large enough to take this type of risk and absorb the loss. For a smaller organization, this kind of creative leap may be something that will force them into bankruptcy.
In the final analysis, your product needs to differentiate itself from the competition, but it should not force consumers to feel bewildered by the extent of change. From a marketing perspective, incremental improvement always does better than a radical redesign or a completely new innovation.
Key 5: Prepare Your Marketing Campaign Well Ahead of Release
Perhaps you remember hearing about the release of an Internet movie called, “The Secret” a few years ago. Prior to its release a lot of anticipation was built up by heavily advertising previews. These previews were online videos as well as television commercials that merely hinted at what the movie was about. Due to this brilliant strategy, the website was ranked close to the top of Alexa for high traffic volumes as people all over the world were frequently checking to see when it would be released. When the movie was finally released, it instantly became an Internet blockbuster because it fulfilled a deep need people have to live empowered lives. The lesson from this marketing story is that if you can excite your audience before you even show them the product, it will do very well.
Edwin Blakely is a marketing director and guest author at Top Marketing Schools, a site with guides and information to help prospective students evaluate schools to get marketing degrees.