Exploratory research with sales and marketing professionals prior to product development
Building a sales team, aligning manufacturer sales representatives, direct salary sales reps, sales managers, lead generators and consultants in early product development stages as part of Exploratory research early on is a critical element to success. Sales Team management and marketing support during life cycle stages can also provide a strong impact on sales results.
Wait, are we talking about marketing before a product is actually developed? Definitely! You might argue, marketing isn’t really a critical factor in the actual creation or development of a product. Some tend to believe Marketing is all about selling the product once it’s made. Sadly and quite often, this is how marketing is defined – when it shouldn’t be. When you are developing your product you are, in essence, developing a marketing program. If you view your product as an extension of your marketing efforts, chances are your business and sales results will be far more successful. In today’s markets, with increased access to information and rapidly decreasing product lifecycles, the management, development, and marketing of a company’s product are critical.
Market Analysis utilizing experienced independent sales representatives and independent consultants
An analysis of the market, talking with potential customers and niche specialty sales professionals can be useful resources in exploring the niche for a new product to occupy, success potential, demand needs, and sales process. This suggests that the organization must do extensive market research early in the development stages in order to determine what requirements the product must satisfy, the competitors in the market space, adaptability potential and more. There is no point developing a product, no matter how well it is engineered, if there isn’t a market for it. Breakthrough innovation is a key driver of competitive advantage and the determining factor in driving revenue growth across the organization. The marketing department will, therefore, have an important role, both identifying if the product should be developed but also developing a business plan to sell the product to the market. (Explore further and sign up if you are interested in market research opportunities. If you are a clinical professional, explore further and sign up if you are a clinician seeking market research consulting opportunities or explore a few of our publicly listed Opportunities for clinical consultants)
The life cycle concept is not well-suited for forecasting product sales.
As an example, if sales peak and then decline, sales and marketing managers may conclude that the product is in the decline phase and therefore cut the advertising budget, thus precipitating a further decline. The product life cycle concept helps marketing and sales managers to plan alternate marketing strategies to address the challenges that their products are likely to face. It also is useful for monitoring sales results over time and comparing them to those of products having a similar life cycle and those with a growing market share.
New Product Development (NPD) and Product Life Cycle (PLC)- Simplified, the stages through which individual products develop over time. The complete process of bringing a new product or service to market, from the new idea (Idea Generation) to concept to market penetration.
Idea Generation is also referred to as the fuzzy front end. Very often, only little effort is devoted to the early phases, in theory as well as in practice – ultimately, leading the product to high failure rates related to these insufficiencies during the early development phases and potential insufficiencies during market launch. Creative sessions, brainstorming, ideation, qualitative research including efforts put forth in market research, SWOT analysis (Strengths, Weaknesses, Opportunities & Threats), competitors matrix, R & D process (Research and Development), Distribution and sales process is an important process to successful sales results.
Product Life Cycle
Development Stage – Product development is the incubation stage of the product life cycle. Often times, there are no sales as the firm prepares to introduce the product – while others have already focused on sales and marketing efforts during exploratory market research, initiated introductions and aligned pre-order sales direct to the end user or stocking distributors. Considerations for manufacturer sales reps, distributor partners and sales managers are a critical part of being prepared and ultimately may be a determining factor of success or decline of the product.
Introduction Stage – Substantial research and development costs have already been incurred in getting the product to this stage. Marketing costs may be high in order to test the market, undergo the launch promotion and set up distribution channels. It is typically unlikely that companies will make profits on products at the Introduction Stage. Aligning with Independent Manufacturer sales representatives and independent commission only contractors already in the sales field calling on niche call points can provide a firm powerful and rapid entrance into the market at a savings of placing all direct salary sales reps. At this stage, products and sales teams promoting the product have to be carefully monitored to ensure that they start to grow, providing solid introductions into the market. Specialized sales management teams, utilized as consultants or sales team managers, can be of significant value to the success of the launch, introduction and growth stages. The introduction stage can be another huge learning and (often) a disappointing experience for the firm if corners were cut during earlier stages – market research, competitors, market trends, unpreparedness with pre-aligning sales representatives, acceptance by sales team members and end users.
Growth Stage – The Growth Stage can be characterized by the rapid growth in sales and profits. Significant promotional resources are traditionally invested in products that are firmly in the Growth Stage. Team management and sales team support are critical. For a unique combination of creative and analytical talents, access to additional sales representatives for deeper market penetration and professional sales managers can have a great impact on this stage.
Maturity Stage – This stage that competition is most intense as companies fight to maintain their market share. Marketing and sales personnel play a key role in this stage.
Saturation and Decline Stage – This can be characterized when the market begins to shrink, reducing profits and sales. Prices – profitability diminish, profit becomes more of a challenge as the result of production or distribution efficiency than increased sales. Saturation may be as the result of intense success, or upon the growth of new competitors additionally saturating the market. Like all other stages, care still needs to be taken to manage the product carefully. Production costs may have been reduced as the result of quantity production during the growth stage while careful considerations are warranted to determine whether the product remains profitable. Dependent of same, a company may decide to end the product, transfer production to a cheaper facility, reduce purchase cost to end users or sell into cheaper markets or release the product to another firm. (Product/Company acquisition – mergers.)