The Role of Market Research in Product Development and Innovation
Having something new to offer to the market is always a challenge, but new things are usually easily embraced and positively taken. Everybody wants to try something new or have the latest products on the market. It's exciting and people are usually very willing and open to trying new things. This is because they hope they will be better than the old ones and will positively change their lives.
So then why do new product launches fail so often and so quickly? Statistics vary for different industries, but most of them are very gloomy with extensively high numbers of product failures. And product failure usually leads to business failure even for some of the most successful ones out there.
Knowing this makes it very difficult for people to get inspired to try out, risk, and launch new products when the odds are against them in most cases. And why is it so difficult to develop a new product and maintain its relevance?
Well, being innovative and having a great idea for a product is one thing. But launching it, knowing when, where, and to whom to offer it, requires a completely different scope of skills and knowledge.
The saddest thing is that most of those failures could've been prevented and didn't necessarily need to happen. How? By researching the potential market, potential customers, and their needs. Most of those who failed didn't bother to address these issues.
That's why market research is the key and most successful element to be conducted beforehand. Properly conducted market research is a protective tool against product failure. It can aid product development and innovation immensely.
So to anyone who is wondering why their product failed or how to approach launching another one here are the biggest advantages of conducting market research for product development. This article will provide you with the hows and whys of doing market research in the process of developing your product.
Product development is the process of bringing the product from being just an idea and a concept to reaching the market. It's the initial stage of creating the product before it's launched.
Market research or marketing research is the process of gathering, analyzing, and interpreting information about a specific market segment. In the process of product development, market research is done to determine various factors that would influence its launch. Market research in this stage can prevent the product from failure and will determine whether its launch is feasible at all. It's a complex process that needs to be approached from several perspectives. Here are the most important things to pay attention to.
Learn more about this field with the help of market research companies that will guide you through the complicated market labyrinths and will be by your side when you make better-informed decisions. You may think that reading online is enough to be able to do market research, but if you want to achieve any real results and have tangible and useful data about the targeted customers then leave it up to professional companies that can obtain this information for you. It might seem like an investment, especially in the initial phase where you still haven't launched your product but it's definitely worth it in the long run. Having professionally gathered statistics will put you in a great position to start making reasonable decisions regarding the launch of your product.
Use ready-made form templates
It's hard to look professional at the very beginning when most of the things are done for the first time. That's why using pre-prepared contract and agreement templates will easily get you on the right track and save you lots of time and energy. Proper documentation is essential during the product development stage for several reasons:
- Clarifying the expectations
- Protecting intellectual property
- Establishing clear communication
- Managing risks
Moreover, establishing Good Documentation Practices in this initial phase will set up the tone, establish professional routines, and make things easier in the future. Having easily editable, ready-to-use templates that even provide signature features is just a gift at this starting point.
The most important thing that needs to be tested during market research at this stage is the potential customer's reaction to the product. That reaction wouldn't be possible unless we have something to show them. However, since we don't have a final version of our envisioned product at this point, the best we can do is create as close as possible a description of it or display a prototype of some sort to allow potential buyers to assess it. The variety of prototypes that can be used depends on the product or service itself, but the ideas are out there you only need to find the right one for you. The best results in this research would be achieved when we can bring people as close as we can to the real-life experience they would have with the product.
So, in digital products, for instance, it would be best to create a dummy sales page, a landing page, or a Powerpoint presentation simulating your web page. If this is not possible then a detailed description including all characteristics of the product would do the job. It's very important that this description is given in the clearest way possible.
It's also important to note that you don't have to have your final version at this stage. You can even have several different prototypes and get reactions to all of them to see which one would work best. And that is the whole point of market research at this stage.
As said previously the most important role of market research in the stage of developing the product and before its launch is to prevent product failure. In order to do this, market research needs to determine several things and cover a few aspects. These include
Establishing whether there's an actual need for our product on the market is of key importance and solid research should be conducted before going any further with product development. Sometimes this process takes us in a whole new direction. The results can show there is no need for that particular product or service but rather a new idea comes up of something else that is needed instead.
For instance, a private language school interviewed companies and their employees on the need for online individual Business English lessons. A significant number of the employees answered that they would prefer having their language lessons right before or after their working hours within the premises of their company instead of taking up their free time at home. So the whole concept of the offered service changed due to the established needs of the customers.
Researching similar products and various solutions for the same issue will not only lead you to determine the need for the product but also will offer ways in which we can alter the prototype to suit the target market better. By reading reviews of competitors' products we'll get an idea of what people like and don't like about the product, what they think is lacking, and what can be improved. So we can use all that to create versions of our initial concept that will fill in all the missing gaps in the reviews. Or we can remove some features that people think are an issue.
In short, the pros and cons of our competitors will serve us as a compass in terms of where exactly our product should be located on the market.
Conducting pre-launch market research doesn't only provide ideas on how to alter the initial idea and adapt your product to the needs of the market but it also gives pretty clear directions on how to go about advertising the product. Most of the research consists of gathering and processing information on competitors' products and services among which their marketing strategies as well.
The research should provide you with sufficient information on how to best sell your product, what works and what doesn't for your targeted segment of the market, and what marketing strategies to use. If done properly, market research at this stage should put you in a position to build up your marketing vision based on statistics and relevant data.
We hope that the article we've put up for you will inspire you to start using market research as early as the product development phase. We hope that you're now convinced of the importance of this research and its role in preventing product failure.
It's also worth mentioning that market research is not an exact science and should be looked at more as an experiment. One that will hopefully lead to the fruition and fulfillment of your goals.
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The WorkFlow podcast is hosted by Steve Glaveski with a mission to help you unlock your potential to do more great work in far less time, whether you're working as part of a team or flying solo, and to set you up for a richer life.
To help you avoid stepping into these all too common pitfalls, we’ve reflected on our five years as an organization working on corporate innovation programs across the globe, and have prepared 100 DOs and DON’Ts.
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