New Product Development for Export Markets
There is an ever growing desire for customers to have new products. Meanwhile, companies frequently use new product development as a means to refresh their competitive advantage and some even set it as a business objective. With respect to international business, faster new product development is essential for companies wishing to secure increased export involvement. Ceris Burns, international marketing specialist for the cleaning industry considers new product development for overseas markets and outlines the implementation process that should be followed to minimise risk.
Few products these days are revolutionary which means that companies need to be innovative in every aspect of their business in order to keep one step ahead. Most often new products refresh or reinforce a product range by complementing the existing offer as opposed to being a catalyst for business change. Companies should bear in mind that the time needed to copy products is shortening and as such fast and cost-effective simultaneous launch of new products across multiple markets can be prudent.
The process used to develop products for international markets is similar to that for domestic markets. The main steps include; idea generation, market screening, business analysis, product development, market testing, marketing and product launch. The major difference is the increased requirement to analyse a product’s suitability for launch as several countries are to be targeted as opposed to one. In depth research and reliable local knowledge is crucial to ensure that local product needs are met and for products to be positioned correctly from the beginning.
The process for international product development should include:
Make sure you use all resources available to you both internal and external for new idea generation. Get everyone involved from employees, R&D, competitors, customers, sales personnel and distributors through to external experts.
Develop tough criteria to test ideas for their suitability in all target regions or countries so opportunities and any country specific restrictions are not missed. What will work wonders in one country might not make it off the starting blocks in another. Also remember to assess the level of adaptation needed for the product to be accepted in each market.
Establish criteria to measure launch success and failure and link these to your target markets. You should also make provision for contingencies and unexpected events that might just occur.
All relevant functions from production to design should be involved in the product development process. Whether in-house or external R&D is used, it’s important that key management has easy access to the technology experts. It might also be practical if R&D were located close to your key target markets.
Test Your Market
The test area must be representative of your key target markets if the results are to be trusted. Infrastructure for market research, advertising and distribution will need to be established and you should remember to consider how your competitors may respond in your test market and globally.
Prepare a launch plan for either sequential launches where your primary focus is on lead markets or for a simultaneous launch where all countries are entered at the same time. Be ready for your competitors to react. If serious players they shouldn’t give up their slice of the market without a challenge.
Protect Your Competitive Advantage
Think about your competitor’s ability to copy and launch similar products. You should protect your Intellectual Property by taking out patent protection. Establishing a licensing agreement could also protect your position by enabling fast widespread distribution of your product on a regional or even worldwide basis.
Timing Is Everything
Finally, timing is critical for new product development to succeed. Get it right and you’ll be able to fully exploit opportunities or competitor weaknesses. It is also important to keep your time to market i.e. from idea generation to full market distribution, to a minimum.
For more information about new product development contact Ceris firstname.lastname@example.org