For many B2B manufacturing businesses ongoing new product introductions are the life blood of the business. Products are naturally superseded by newer versions and customer requirements move on and change over time making a once great product idea obsolete. Without new products to replace the old a business will inevitably fail to achieve the growth it requires.
The required rate of new product introduction can vary wildly according to the market in which a business operates but the fact remains new products are often essential. The challenge is to find research and introduce products or services that satisfy a customer need and generate sales.
Ansoffs matrix often provides a useful starting point. Although a far from perfect model it does provide some useful insights. It suggests four business growth strategies and grades the risk of each. The four options, graded from highest to lowest risk are:
- New products to new markets – Diversification
- New products to current markets – Product development
- Current products to new markets – Market development
- Current products to current markets – Market penetration
If we consider the diversification and product development strategies then each presents its own problems. When attempting the product development strategy it is all too easy to fall into the ‘me too ‘ trap and either promote equivalent or similar products to those already delivered by the competition. To try to come from behind against already entrenched competition with a similar offering can be difficult.
The alternative is to develop products with a unique selling point that satisfy an existing market need in some different way. Ideally, to avoid competition, these products should capitalise on unique or specialist design or manufacturing capability within the business making them difficult to copy. The problem is these products can be more difficult to identify than ‘me too’ and present a greater risk of failure.
To go further and produce new products that are truly innovative and satisfy the needs of a marketplace not previously addressed can be a step too far. If it can be achieved the rewards are high but the risks of failure are also significant. Without detailed research addressing a new market can be a leap in the dark.
A simple way to get the new product ideas process moving can be:
- Identify the leading current products in the marketplace of interest.
- Identify the need they satisfy.
- Think of a similar product that may satisfy that need better, cheaper or easier.
- Research enabling technologies that may make the product a reality.
Then sketch out some product concepts without worrying too much about the engineering implications. These product concepts may then be progressed through a screening process to identify those worth further analysis.