Marketing for a new product

The marketing strategy behind rolling out a new product is a rarely appreciated animal, but the buzz it creates is worth its weight in sales

By Kimberly Griffiths, Associate Editor -- Industrial Distribution, 8/1/2005

With a new product's research and development taking anywhere from 18 months to three years, and a huge investment, manufacturers and distributors know how much is riding on a key marketing strategy. Even so, rolling out a new product is a marketing feat that few understand, and even less really appreciate.

A little-known fact is that the marketing strategy begins about the same time the tool's own development begins. Both tool and campaign propelling through their own testing, developing, research, and endless tweaking—then arriving on a distributor's doorstep all wrapped in a neat package—is a huge achievement.

''The process certainly does not begin five months before the tool is ready,'' says Randall Coe, director of product marketing at Bosch. ''Although some have done it that way. A successful campaign is all about communication from early in the development of the product. But it can take 18 months to three years to develop and carry out.''

An initial marketing meeting could include almost everyone involved in every aspect of the new tool, including the product people (the guys behind the technicals); communications people (for branding); and the channel people (participants in the channel of distribution). Each strategy is tailored to each product.

''Everything flows from the tactics of that strategy,'' says Coe. ''The message though, is to keep it simple and straight-forward.''

New products play an important part in most any company, and how those products are received by those that both distribute and buy them is paramount. Branding, strategy and creativity are essential to a successful marketing plan.

''On average, new products represent 25 percent or more of our annual sales year after year,'' says Randy Breaux, vice president—marketing, for Baldor Electric Co. ''Baldor has a defined method of new product development. The process starts in the field with our sales representatives.... From that feedback, we then determine if an opportunity for a new product is present. If so, a proposal is written and submitted to Baldor's new product development team. The NPD team is headed up by me, and includes members from engineering, manufacturing, applications, sales and materials.''

That the marketing department is so involved in the development of the tool from the beginning is significant. That first meeting affords the strategy team a more intimate and informed look at the benefits the tool could bring the customer.

Of course, there is a general set of steps that are followed for the roll outs.

''Reelcraft utilizes manufacturers representatives as a primary conduit to our industrial distribution,'' says Rex Larkin, vice president—sales and marketing, for Reelcraft Industries, Inc. ''We use several steps in rolling out new products, including: special literature created and sent to the sales reps; direct mail conducted to active distributors; extensive advertising conducted in a wide variety of publications; new products placed on the Web site for easy access; e-mail blasts sent to enlisted distributors and customers; Internet search companies used to help customers access information; and customer-service personnel actively discussing the products with distributors and customers.''

With so many avenues available to market a tool to its distributors and customer base, the strategy session is invaluable to the roll out.

''The whole thing could be loosely described as 'buckets' when developing the marketing plan,'' says Coe. ''Merchandising, launch quantities, training, promotion and advertising are all different components. Bosch has learned that these many different variables are necessary to make a product successful, and launch it successfully.''

Focusing on the product plan is a new and important position for the launch leader, says Coe, who must ensure that all the parts are on schedule.

''Depending on the product and the market opportunities, some products require a different roll-out process than others,'' says Breaux. ''If the product is designed for a specific market, we will tailor a roll out or product launch designed to hit that particular market segment only [with trade journal ads, press releases, new literature and literature releases]. If it is a product that will serve the needs of a broad-base of applications and customers, we may do a larger launch that will include a press reception at a national trade show.... Each of these launches typically prove successful.''

So how important are these roll outs to the ultimate life of the product? Do they really make that much of a difference down the line?

''The roll outs are very important in getting to the market quickly,'' says Larkin. ''The long-term success of a product can hinge on the speed and completeness of the roll out, especially when offering a product with much differentiation in the market.''

Other marketing gurus agree, though they also state that the life and death of a product really rests on the product itself.

''You can have an awful product and launch it very well, but, because of the product, it won't be successful long term,'' says Coe. ''The ultimate success of the product is in the product. A good launch will have short-term benefits, but the product has to be good.''

Creating the kind of buzz that's really needed for a successful launch though, starts at home. Excitement from the manufacturing company and its distributors can have the biggest impact.

''When launching a new product, one of the keys is getting 'buy in' from your sales force and creating excitement,'' says Breaux. ''Giving the salespeople something new to talk about with customers, especially when the new product provides a benefit to the customer..., always creates success.''

Adds Larkin, ''People sell to people. Good distributors are the key to success of any new product in the industrial market. For many manufacturers, distributors offer what we cannot: bundled products, face-to-face relationships, and local service. Distributors act as the voice of the customer.

''The difficult part is always the complete communication from the manufacturer to the distributor,'' he continues. ''The electronic media has helped very much, offering both e-mail and Web sites as a media to roll out new items. Reelcraft also relies heavily on the printed media, as well as direct mail, to communicate our offerings to distributors and their customers.''

The buzz and excitement, therefore, are paramount to a successful launch.

''We have a very good track record of success for our new products,'' says Breaux. ''I believe this is mostly due to the fact that ideas for new products originate with the customers, and are not something conjured up in engineering. We have a simple philosophy, 'We build what we sell, not sell what we build.' That means, let's put time and effort designing, building and selling products that customers have already told us they want to buy. It makes our job in new product development quite a bit easier, because once the product is produced, we already have customers waiting to buy it.''

Too often, a product is developed, and there's little to nothing to say about it, explains Coe. ''A credo that we've taken on in development is said from the customer's perspective, 'how are you going to hook me?' Over the last four years, things have shifted. They don't want to be told why something's great. They want to see the difference demonstrated to them.''

The success of a roll out hinges on the company's consistency and execution of the launch.

''Customers in Tennessee and California need to see the same message and display,'' says Coe. ''The big three words for any roll-out strategy are: execution, focus and consistency. But in the end, if it's a great product, you already have a great argument as to why the customer should buy it.''

Comments? E-mail Kimberly at kgriffiths@reedbusiness.com.