Profitable New Product Development

Profitable New Product Development - 7 Marketing Musts
By Tammy Katz

1. Delight your target consumer
DO focus on creating items that truly solve your target consumer's needs and points-of-pain
DO meet and exceed their needs
DO create fans, not just customers
DON'T focus on internal issues
- Can you precisely define your target market and what motivates them?
- Does 50% of your target audience say they definitely or probably would buy your product?

2. Make sure it's profitable early
DO screen ideas for profit potential at the idea stage
DO rework ideas early to address any profitability issues
DON'T pursue a flawed business model
- Does my item yield a lucrative P&L on a total and per unit basis?
- Do I have a viable business in Year 1 and "Year 3"?

3. Select and perfect ideas
DO choose the best among several ideas
DO challenge and refine good ideas to make great ideas
DO seek feedback from your target consumer and development resources
DO strive to exceed expectations, be different, be better
DON'T jump to one answer
- Is this among our best 1 in 3 or 1 in 5 ideas?
- "What could make this even better?"

4. Position and clarify the product idea
DO ensure you clearly articulate what it is, what it does and how it benefits your consumer
DO take full responsibility that your customers (trade and consumer) understand its benefits
DO be different and superior
DON'T overlook any opportunity to precisely tell your story (e.g. every touch point)
- Can you explain your concept in 5 words or less? Do customers (trade and consumer) understand and respond to your idea?
- Are you different and/or superior?
- Do you have a compelling profit story for the trade?

5. Keep your marketing frugal, focused and factual
DO identify your business goals before you spend anything
DO compare and choose among alternatives (suppliers, programs, methods)
DO quantify the productivity and efficiency of your programs
DON'T "just do it"
DON'T overlook low-cost and no-cost public relations opportunities
- Does this plan/program meet my business objective?
- What is the return-on-investment? Is there a more efficient option?
- Is this program fully leveraged and consistent?

6. Perfect your business model
DO maintain, measure and continuously improve a test market
DO test and refine product mix, pricing, and sales and marketing tactics
DO track and improve profit performance
DON'T measure progress only by total sales growth
- Have you identified a small market in which you can monitor your business model?
- What is your P&L performance in this small market?
- Are you continuously testing and improving performance?
- Can you expand your best business model?

7. Outmaneuver the big guys
DO monitor and react to consumer feedback
DO identify and own your niche
DO develop new products faster
DON'T compete directly with them where they are strongest
- Do/can you own your niche?
- Can you serve market needs and gaps that big guys consider 'too small'?
- Can you incorporate feedback for more, superior new products?