Managing New Products

Taufik
Associate Partner, MarkPlus, Inc
Head of MarkPlus Insight
E-mail: taufik@markplusinc.com

How can we win the product war among the swarm of hundreds, if not thousands, of similar products already existing in the market? What must we do?

These questions often surface, particularly from product managers, particularly when the product is new - whether it is new to the company or new to the market. As with other new things, many other things need to be adjusted. And acceptance as well as adaptation are required, be it from the company or the market (read: customers).

Based on my experience in handling various clients from different industries, a few problems that usually occur in the development of a new product are:

• False interpretation of market trend or condition and consequently incorrect formulation of a suitable product
• Problem in coordination with internal teams, e.g. design, production, finance, marketing communications and distribution
• Limited budget and difficulty in calculating Return on Investment (ROI) of the product
• Inefficient market testing and misleading measurement of the efficiency of the marketing communication program
• The long amount of time taken for development, missing available opportunities
• Premature product launching, while infrastructure and facilities are not yet ready

Actually, the product development program is extremely complex due to its end-to-end nature. A product manager needs to fully comprehend this and be involved from the beginning, starting from idea development, design, production, up to product launching.

Indeed, new product management happens in different stages. In the idea development stage, for example, solid decision making is essential, where everyone obeys and conforms to the decision. In the development stage in R&D, a thorough testing that fulfills the existing standards is needed. While in product launching, market acceptance of the new product has to be evaluated routinely.

To anticipate and minimize the risks that may be present in the process managing a new product, there are a few things that marketers, especially product managers, have to pay attention to. They include all stages, from design, development, up to product launching.

For one, in the design stage, marketers have to be able to answer the following problems: How to read future trends and current consumer needs; How to translate these trends into opportunities for the new product; How to specify the elements content and context from this product embryo to being accepted by the market.

Meanwhile, in the product development stage, we need to find the solutions to the following problems: What are the steps taken in the company in developing the new product; How to form a solid work team; Who should be involved and what is the most effective and efficient flow of work; How to estimate the budge, costs, and market size of the new product; How to get approval of upper management on the project; How to execute the entire development stages rapidly in a time-based process.

And finally, in the product launching stage, the following problems need to be solved: Necessity of product prototype; How to conduct an effective and efficient market test, and the measurements used; How to create an effective and efficient distribution and marketing communications for the launching program; How to educate the market to accept a new product/ concept that is foreign to them; And how to measure the effectiveness of the launch in the first 3 months.

I’ve witnessed a number of companies overcome the various problems present in the multiple stages of new product management and achieved success. For example Mizone, which cleverly enter the health/energy drinks market with a new category. On the other hand, we are familiar with the creativity of Nokia, which is able to routinely launch new products in short periods of time while creating phenomenal product launches.

Management of a new product is indeed a risky process but nevertheless promises an alluring profit. I would say it’s extremely risky, because if it fails it may upset the performance of other, already established, products. Nevertheless, if market acceptance is good, the new product can act as the competitive edge of the company.

Therefore, manage your new product properly. A saturated market does not mean the door has already been closed; there are always opportunities for those who are innovative and persistent!

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