Every year, thirty thousand goods are launched, with 95% of them failing. Businesses risk wasting a lot of time and resources if they don’t get their new product right with those odds. It is very important that every organisation have strategies for increasing sales, in place.
To beat the odds, define your target market, analyse risks, and make sure your product is the proper fit. You can sell better, close more transactions, and increase conversion rates if you have a marketing and sales strategy.
We’ll go over how to sell a new product in this article. To prepare your company for a successful launch, follow these six steps.
1. Conduct new and existing consumer research to define your target market.
Find out if there is a huge enough market for a new product before developing it and figuring out how to sell it.
Talk to your current customers as part of your study to see how new product ideas can help them solve existing or adjacent challenges related to why they’re already investing in you.
Then consider to who you’ll be marketing the goods. Determine your target market by defining:
- Your ideal client (e.g. occupation, age, location, company worth, etc.)
- Their requirements (for example, what issues do they have that your new solution can address?)
- The fit of the product (will your new company ideas genuinely help them?)
You risk spending time and resources building a product that no one wants or needs if you don’t identify these core target audience characteristics.
Next, evaluate your product’s potential in your target market:
- Competition. Determine if companies are already selling a similar product and what makes yours stand out (USP). If it’s more efficient or was produced by a purpose-driven company, for example, you’ll want to emphasise that.
- Size. Determine whether your target market has enough potential consumers who fulfil your ideal customer profile (ICP) to meet your revenue targets and profit margin targets.
- Potential revenue. Calculate whether the expenses and hazards of marketing and selling the product outweigh the expected profit. This will be determined by the size of your target market. Determine your total addressable market (TAM), serviceable addressable market (SAM), and serviceable obtainable market (SOM).
This market research and strategic thinking can help you decide whether your new product is worth the risk in your target market.
2. Consider the operational challenges of marketing things.
The demand on your team’s time will be one of the most difficult operational challenges you’ll face. You must account for this increase in time spent selling when selling a new product or product range.
More complex selling will be required for innovative products. To comprehend them and sell them effectively, reps will require further training. They’ll also devote more time to showing clients how it works. Your sales reps may take longer than they would with established items to establish trust and demonstrate the product’s worth through use cases and demonstrations.
Your marketing department will also be involved. Educating potential clients and making them feel comfortable with your new product can be as simple as writing and publishing informative how-to blogs on the company blog or conducting webinars.
In step five, we’ll look at how you may train and equip your salespeople to market new goods efficiently.
Finally, automate as many menial jobs as possible to reclaim time back. Workflow automations can help you save a lot of time on mundane activities like updating lead scores or deal stages. Outsource duties to automated assistants to allow your employees to focus on more vital responsibilities, such as creating relationships.
3. Make a marketing strategy and a sales process map.
Define the new product’s goals and the activities you’ll take to attain them as part of a successful marketing and sales strategy.
A sales plan for new items should include the following:
- Mission statement and positioning. Explain why your product or service exists, its market position, and the challenges it solves. This component of the plan will include thorough information about your competition as well as your value proposition (the features and benefits of your product).
- Team structure for sales. Plan out your sales team and organisational structure if you’re selling to a completely new market in a new territory. Every member of the sales team will have duties, responsibilities, and compensation. Define who will be engaged in the sale (e.g. a sales engineer) and what stages in the sales pipeline you’ll need to bring them in if you’re selling a new product to the same target market and audience, especially if it’s a technically sophisticated product.
- Goals. Create revenue targets and revenue goals based on previous sales activity and performance. Break out pipeline phases and rep activities across the client journey in this area. Include specific details on sales targets (such as quotas and indicators), revenue goals, and the number of sales reps required to meet them.
- Performance tracking and KPIs. When it comes to marketing the new product, your team will be judged on the metrics and key performance indicators (KPIs). Include how performance will be monitored, KPIs for each sales stage, and whether you’ll be tracking victories with spreadsheets or software (such as a CRM).
After you’ve produced a basic sales plan, you’ll need to consider your sales strategy. Your sales strategy will link your activity-based goals, results-based goals, and positioning to the selling tactics your team will employ.
Whatever your precise objectives are, make sure to map them to your present sales process to ensure that they are compatible with your current workflows and stages of the sales pipeline. If not, you’ll need to fill in the blanks to guarantee that your sales process for your new product or solution is as efficient and successful as possible.
Consider when you’ll be ready to offer a minimal viable product once your sales plan and approach are complete (MVP). This is the initial version of your product that you can distribute to customers with core functionality.
Because investing in the product’s features without first obtaining feedback and surveying early adopters might be hazardous and expensive, your MVP isn’t a finished product. Once you have this information, you may adjust the solution to better suit your consumers’ needs.
When creating your MVP, keep the following in mind:
- Cost. When will your MVP be ready, and how much will development cost?
- The price point for newcomers. Decide on a price point for your MVP that is competitive with the competition.
- To BETA or not to BETA, that is the question. Decide whether you’ll offer the MVP for BETA testing to your existing consumer base. This allows you to collect thorough feedback before making it available to the general public.
After you’ve drawn out your sales strategy and process, you’ll need to create a sales and marketing budget.
4. Establish an accurate sales and marketing budget
You’ll need to figure out how much your organisation is willing to spend on sales and marketing before you start selling directly to end-users.
These costs should cover everything from marketing and advertising to MVP testing and any initial sign-up discounts or product offers involved in launching the new product.
Let’s begin with the marketing and promotion approach.
According to a report, new businesses typically spend between 12 percent and 20 percent of their gross revenue on marketing. This is divided between brand development costs (for example, promotional channels such as your website, social media accounts, blogs, and sales collateral) and direct marketing campaign costs (for example, advertising campaigns, SEO, and trade shows).
Consider your sales budget next.
To get an approximate estimate of prices and deadlines, use your existing sales data. A typical sales budget may account for sales cycle lengths and employee costs and will cover weeks, months, or quarters.
You should be able to estimate revenue and expense based on previous sales data. The budget should also break out estimated sales over a specific time period, product prices, and total revenue. Calculating these numbers can help you understand how much your sales efforts will cost and how much money you have available.
Include any fundamental operating expenditures related to marketing and selling the goods. Among them are:
- Operational. What your goods will cost to make and transport.
- Staff. The amount of money you’ll spend on staff, including bonuses and sales commissions.
- Business expenses in general. This should include software/hardware, building rent, and utilities.
Remember that your staff will be marketing a new product, so educate them on its features and applications.
5. Provide in-depth training to your personnel.
Selling a new product will be successful only if your salespeople are well-versed in it.
Determine what kind of training your salespeople will require to sell the new product, taking into account its complexity, features, and price. Work with your product teams to figure out what problem it solves, why it’s beneficial, and how to best sell it to customers.
It’s critical to make your sales staff passionate about the product and its differentiators so they can confidently market it to customers early on in the sales cycle. This will also necessitate the salesperson’s knowledge of the product’s characteristics and how they might assist the consumer in overcoming their challenges and pain spots.
Your comprehensive training should include:
- Putting it to use. A detailed description of how the product works in practice. Demonstrate how to use it to your salespeople as if they were the customer.
- Benefits and ramifications of the product. This section of the training should emphasise the product’s immediate and long-term benefits, as well as how it will impact the target audience’s lives.
- Background information. Provide your team with as much information on the product’s development and use cases as possible. Assume the new product is software for email marketing. In that situation, your salespeople must be familiar with the fundamentals of email marketing and be able to comfortably use industry-specific terms and phrases when speaking with customers.
You can also broaden your sales training to include other aspects of the sales process, such as how sales reps should qualify leads and address objections.
6. Create sales and marketing feedback loops to boost success.
Track the success of your sales and marketing activities once your team is ready and your product has been released to the public.
After the initial release, tools like product surveys and feedback forms will help you fine-tune the product. To make continuous improvements and use success stories as social proof in marketing efforts, you should also collect testimonials from early adopters.
When evaluating the success of your new product, some measures will come in handy. The following are some basic KPIs to consider measuring:
- Customer lifetime value average
- Score of net promoter
- Won deals vs. lost deals
- Revenue from new customers vs. revenue from current customers
- Revenue earned vs. selling costs
- Market encroachment
- Progress through time
Furthermore, specific measures such as the number of new product trials and engagement rates are particularly important for assessing a new product’s success:
- New tests. It’s critical to know how many people are joining up for your new product and how many of them convert to paying customers after the trial period has ended. A lower conversion rate could mean that clients are unhappy with the product or that it is overpriced. Customer surveys and other tools can help you figure out why.
- Rates of product engagement. Because new trial numbers don’t often tell the whole story, it’s also crucial to keep track of how customers interact with your new product. If engagement is low, it could be due to a lack of features or a UX issue that is affecting their experience and needs to be addressed.
- Obtaining leads. Tracking lead sources and closure rates can also help you determine how effective your lead acquisition and marketing channels are and whether you need to reallocate resources. If your marketing team notices that Twitter is bringing in the majority of your new clients, it may decide to shift some advertising spending from a low-performing channel to enhance income even more.
Your team can also measure activities that directly impact the goals you’ve set for selling your new product using a CRM platform like RisePath CRM.
With the odds stacked against you, it’s critical to get your company ready to go.
This can be accomplished by spending time learning about your new market, studying your target clients, and developing a sales strategy that connects your revenue targets to your product. Your sales and marketing teams will be able to confidently sell new products to new customers with the correct training.
Measure your efforts and solicit client feedback to ensure that your product is continually improving. Adding appealing features to your product during the early stages of development can help your launch succeed and increase your profits.