Throughout the life cycle of a product, from ideation to monetization, it's important that product developers stop at each stage to ask questions. Does this idea or concept merit further consideration? What consumer base are we targeting? Will the company make money? Viktor Bogdanov draws from his experience with software development firm Intersog, to examine the abstract questions that drive product development.
An idea and the desire to bring it to life — this is the starting point for any new product launch. But, once you have an idea, what are your next steps to make it a reality?
Three challenges come to mind when thinking about next steps for launching a new product or service:
- Determining whether an idea actually has the potential to become a useful product
- Defining your product’s potential target users
- Creating a business plan to monetize your product
As a B2B marketer and PR and communications strategist with over ten years of experience helping tech companies in Europe and North America launch their digital products and services, I walk you through each step you need to take to go from idea to successful product launch, including evaluating your product’s value, identifying target markets, and defining your business model. (For simplicity, I use the term “product” to encompass physical items as well as services.)
How do you know if an idea has the potential to become a useful product?
Step 1: Identify the Main Points of Value
Before developing a new product, it’s necessary to verify the feasibility of your idea to ensure it’s worth the required time and financial investment to launch.
A starting point for analyzing the viability of your idea entails determining the potential product’s unique selling points (USPs), or the unique features that differentiate it from any existing competition in the market.
Your product is more likely to achieve success in both the mid- and long-term if it has unique characteristics and value.
Therefore, you need to fully understand its usefulness before making any investments. In other words, what’s the main value of the product for end users and business stakeholders?
Here’s how to get started determining value.
First, ask yourself two questions:
- Will the product be unique and original, or will it replicate similar, existing products?
- Does the product fill a role for which there is no good alternative already available on the market?
Then, if your answer to these questions is “yes,” think about the following:
- How will the product differ from others?
- What characteristics will make it stand out from the crowd?
Examples of differentiating factors could include higher quality, lower price, better price-quality ratio, newer features or functions, greater ease of use, or higher quality design.
Step 2: Get Expert Feedback on Your Product Idea
One of the best ways to validate your new product idea is to get feedback from peers, leading industry players, and niche experts with relevant knowledge.
For example, attend networking events, and talk about your product idea with entrepreneurs who have experience creating and launching new products. Ask for professional input, criticism, and advice.
Ten minutes of objective, constructive critique from experts is often worth much more than ten hours of talking to friends and relatives. Experts who are honest will outline potential pitfalls and offer constructive criticism that you may need to hear (even if you don’t want to).
In contrast, friends and relatives are likely to praise your idea, which may make you feel good but won’t help get your product launched.
Step 3: Re-Assess & Create a Plan
After collecting feedback from experts with experience launching a product, re-assess your idea to determine if you still want to proceed.
Assuming you’re still excited by your product idea, ask yourself, “What do I want my product to be in five years?”
There are several scenarios to choose from when answering this question:
- Proprietary product that supports the main business, such as Microsoft Windows or Google AdWords
- A product that’s sold to a larger company, such as Viewdle, a revolutionary face recognition technology that was first built in Ukraine and then sold to Motorola Mobility.
- Social product that’s not-for-profit, such as Wikipedia or an application for sporting facilities for special needs children or neutering programs for stray animals
Your product launch strategy will vary depending on your five-year vision.
How do you identify your product’s target users?
Step 1: Learn About Your Audience
If you don’t consider your user from the very beginning of the process of designing a new product, you’re destined to fail after your product launches.
Therefore, it’s important to collect information about your audience in four key areas: the motivation for making a purchase, the reasons why they wouldn’t make a purchase, the challenges that your product can solve, and the use cases that would “wow” them.
Questions to Ask to Determine Your Target User Groups
- Who will use the product now?
- Who will use the product in two-to-five years?
- How will you ensure the growth and sustainability of the product’s user base?
- Is your audience financially reliable and stable?
- What’s the minimum and maximum price that people are willing to pay for the product?
- How do those figures match with financial expectations?
- How will your target audience’s income change in two-to-five years?
- What portion of your product user base will become a loyal user group?
- What happens if you’re unable to attract the right audience after product launch?
The stronger your insight into the type of people and businesses who will seek value from your product, the easier it will be for you to tailor your product to their needs.
Step 2: Get Input from Prospective Users
One of the best methods to get initial feedback from your target users is to conduct focus group research.
Focus groups give you the opportunity to gather a group of potential users, share a product prototype, wireframes, or sketches, and monitor how the potential users react. This qualitative data will help you understand how a user will interact with your product and the existing pain points.
To use a focus group to test how users interact with a mobile application, you need four groups of users :
- iOS users
- Android users
- Experienced app users
- Inexperienced app users
At Intersog we once had a client who wanted to build an information visualization system prototype that provided scatter plot visualizations of U.S. legislative behavior. The goal was to allow users to observe legislative changes over time and make conclusions.
As a development provider, Intersog initiated focus group research as an opportunity to conduct a free-form discussion with potential tool users. Our focus group included four participants and two research facilitators. One of the facilitators controlled how users operated software, while the other took notes, video recorded the session, and assisted with conversational flow.
As a result, not only were we able to get feedback on features and usability but also were able to gain invaluable insight into what questions were most important for users when it came to legislative initiatives.
We converted those questions into calls to action and functional features and added them to the future application to better meet user demand.
Step 3: Use Existing Sources of Info to Learn About Your Audience
Although learning about a bunch of unknown, potential users sounds daunting, it’s important to remember that you can learn a lot by observing your every day surroundings, interactions, and circumstances.
Approaches to Observing & Learning About Your Users
Popular sources of art, like music, which often reflect our concerns, fears, hopes and aspirations.
- Conversations in public places, like on a bus or walking down the street. Being aware of conversation topics may help you identify a common challenge or pain point that a new product could solve.
- Reality shows on the Web and TV from which you can get insight into what your target users like to eat or wear, what sports they play, and more.
- News feeds in social media will help you visualize your users, understand their habits and concerns, and see which topics and/or products impress them.
- Discussion forums or events that connect you with your target user group.
Essentially, become a user yourself to better explore their needs and issues.
Consider how Mars Incorporated, a global pet care, chocolate, food, candy, and drink brand, used popular hypotheses and assumptions about human behavior to create an award-winning TV ad campaign.
Hypothesis: When people are hungry, they struggle to think deeply about anything but their hunger and potential sources of food.
Next Steps: Mars Inc. used this assumption to create an ad tagline that appealed to this common user phenomenon.
Result: Successful TV commercials for Snickers candy bars based on their hypothesis: “You're not you when you're hungry.”
How do you prepare to monetize your product?
Create a Business Model Before Launching Your Product
A product idea doesn’t become a business idea until you can describe how you plan to make money from it. This plan for making money, or business model, requires determining how you’ll attract users to buy your product.
One way to put your product ideas together and better define your monetization path is to use the Business Model Canvas. The tool helps you visualize your business model by guiding you through an exercise that touches on nine aspects of creating and launching a new business product.
The nine business model building blocks include the following:
- Customer Segments: The people and organizations for which your product creates value.
- Value Proposition: The products and services that create value for your customers.
- Channels: The ways through which you interact with customers to deliver value
- Customer Relationships: The type and quality of connects you establish with your customers.
- Revenue Streams: The pricing mechanisms you use to determine the value of your product.
- Key Resources: The infrastructure required to create, deliver, and capture value. These resources are indispensable.
- Key Activities: The things you need to perform well.
- Key Partners: The people who can help elevate your business model
- Cost Structure: The prices you charge for access to the products and services that make up your business.
As you experiment with business modeling, you’ll get a more in-depth understanding of own product and its values, which will help you prepare market initiatives and find the right monetization model.
You can see how Coca-Cola used the Business Model Canvas in the image below.
Each sticky note identifies a key component in a successful business plan for Coca-Cola, from creating the main product, a soft drink, to bottling and selling it in bulk.
Be Creative & Adaptable When Launching New Product
Successful businesses are able to adapt to volatile market conditions. This guide walks you through the steps necessary to grow your business by creating a new product.
First, take your basic product idea and evaluate it against different scenarios, use cases, what-if simulations, and measurable key performance indicators.
Second, conduct user research to understand potential users better. Gear your product toward their needs.
Third, create a business plan and calculate potential financial outcomes for each scenario.
About the Author
Victor is a content writer, turned PR guy, turned head of marketing at Intersog, a U.S. based technology company with R&D Centers in Ukraine and Canada. As a professional B2B and technology marketer, Viktor loves talking and writing about innovation and how it affects our lifestyle.