Despite billions spent on research, development and innovation, studies show that as many as 90% of new product launches fail.
Whether you're a tiny startup or a Fortune 100 corporation, "successful innovators blend optimism with paranoia — an acute awareness of all the hurdles that new products need to overcome if they are to be successful," said Stuart Jackson. Jackson is the vice chairman of L.E.K. Consulting.
Even more important, Jackson said the best innovators harvest those fears to boost the odds of success for their new product.
Anticipate Innovation For A New Product
Whatever your idea is, chances are that there are several other people and organizations working on the same thing, Jackson said.
If that sounds overwhelming, here's the good news: "Success is not defined by those who do it first, but by those who do it right," said Jackson, who with Ilya Trakhtenberg wrote "Predictable Winners." The two L.E.K executives focus on best practices for launching new products.
If you consider the biggest innovation successes of the past 50 years — Microsoft in desktop operating systems, Amazon.com in e-commerce, Alphabet's Google in search and Apple in smartphones — in each case there were others who launched products first but were quickly overtaken, Jackson said.
To fend off competition and succeed, "you need to plot a path to competitive success with more compelling features, greater scale, better pricing or lower customer acquisition costs," he said.
One way to create a competitive advantage is to determine how your competitors are looking at your product and service. You need to keep your product unique in consumers' eyes.
Test New Product Innovation Efficiently
Look for low-cost signals that give insights into what customers want.
The "fast fail" approach used to launch millions of software applications each year highlights this approach. Developers start by putting out a basic version of the app to see if it gains traction. They then invest in refinements if the product takes off, Jackson says.
There are products where it's just not practical to launch a low-cost version. Companies might need other validation tools, such as insights from social media or buying behaviors for consumer products.
Jackson offers the example of the Litter-Robot, a self-cleaning litter box for pet cats. "Despite its hefty price tag, the concept was a huge hit on social media, quickly attracting 23 million Instagram followers — clearly an unmet need waiting to be tapped," Jackson said.
Manage For Success Beyond The First New Product
You can succeed with a new product launch but still ultimately fail if you haven't planned for success. Be prepared to scale up commercial operations, anticipate new competitors and meet growing requirements for investment.
"Innovative new businesses need to have a plan for dealing with each of these challenges," Jackson said.
Continually Drive Innovation
Some entrepreneurs think a single good idea is all they need. But in reality, you need to keep looking for new product innovations as your business grows.
"In a fast-evolving world, staying innovative means constantly looking beyond the immediate horizon," said Michael Huppe. He's the president and CEO of SoundExchange, which protects recording rights for creators. "Fostering a long-term mindset is one that any business — large or small — can adopt."
Always ask what emerging problems could be solved and what new product or service can serve customers' needs for a greater good.
"Innovating with purpose creates solutions ahead of the curve," he said. "By solving an industrywide pain point in service of a mission, you create a business that resonates."
Invert Your New Product Process
Start with the ultimate experience you want to deliver to your customers and then work backward into the solution before launching into new product development, says Jeff Meredith. He's the CEO of Chamberlain Group, which creates access software and devices for garages, residences and commercial properties.
Meredith offers this example: "I'm returning home from a business trip on a January night," he said. "I'm exhausted, it's snowing, my hands are full. I want to get inside, but my keys are buried in my backpack. I need the door to see me, recognize me and unlock intuitively."
This experience frames an example of what you want to deliver for your customer, he says. On paper, nearly every development process has a similar mantra: "We put the customer at the center of product innovation," Meredith said. "In practice, most processes start with a product and go in search of a customer."
