Product Failure and the Associated Fear
21 Mar 2015
Businesses go through various steps and product life cycles during their existence. While they pass through many ups and downs, their essence is the product or service being offered, and this, is the focal point of the business. Needless to say, it is extremely important that the product/service being developed and sold has the ability to attract customers and generate sales. With this comes the fear of developing a poor product that might fail, and as a result take the company down with it. The entrepreneur/ manager will therefore want to ensure he has come up with an unbeatable product /service, and some ways to do so are as follows:
Before deciding on a product, initial market research will be carried out in order to study the market trends. The manager/entrepreneur will need to decide what industry the business will operate in. Initial research will help them decide on factors such as who the target market will be, what product is needed or will be developed, why it is needed, a rough estimate of the demand of the product, and future predictions of the business success and growth if all goes well.
The company will have to study its market and come up with a product based on the market demographics, socio graphics, and general factors. The manager will have to develop either a unique product or choose and existing product and aim to stand out against competition.
Once the product has been decided upon, further research will be needed to decide upon the method of production, the processes and procedures involved in product development, the costs associated, and the final stages of pricing and marketing before it is sent out in the market for sale. Various departments will therefore have to work in coordination, keeping the market being targeted in mind. For example, a product being targeted towards the lower middle class, if priced high, will not be popular and automatically won’t sell. Similarly, a product for women sold in a children’s toy shop also would be unpopular and useless. Therefore, it is important to know what market your product is targeting and decide upon the Four P’s: Product, Price, Place and Promotion accordingly.
It is often wise to run a test marketing program in order to study the reaction of potential customers towards the new product. This test marketing phase is usually carried out in order to gather feedback and fix any possible problems that may be present. It also allows people to be introduced to the product, and get free samples etc, in order to reduce the hesitation of buying, at a later stage.
The initial stages of product development and test marketing should be carried out very carefully, because it can determine the future success and growth of the business. Any loopholes left during the initial phase could lead to numerous problems in the long run and could end up as failure of the business entirely.