There is nothing better than watching sales of your newly launched product go through the roof.
Sales and marking teams and doing high fives all round – even with each other. Then sales plateau or fall off a cliff. Let the finger pointing begin.
So what do you need to know to ensure you new product has the best chance at succeeding in the market?
The first thing to understand is what is driving you sales in the critical launch phase. The good news is there is only two metrics to consider – trail and repeat.
Trial measures how many outlets have purchased the product. This largely reflects how well the rep has sold the product to the outlets and is also influenced by other below the line activity including supporting sales material, deals, promotions etc. Building trial and the resulting distribution base is critical for maximising the products availability to potential consumers and the effectiveness of above the line advertising.
Repeat purchasing by outlets over the medium term is an indirect measure of consumers repeat purchasing. In other words, if the product delivers on the consumer’s exceptions they will continue to purchase the product as part of their standard repertoire. Determining how many outlets are repeat purchasing the product multiple time is a very effective yardstick of the products longer term success.
More importantly, assigning sales to each metric gives a very clear picture whether trial or repeat purchasing is the key driver of sales and how this changes over the longer term.
Finally, identifying which specific outlets have only trailed the product and which outlets are repeat purchasing multiple times enables the reps to take action to ensure the success of the new product.
Outlets that have purchased multiple times can be supported so they will continued to push the product. Additionally they can be used to build good news stories to share with outlets that have not yet purchased the product. Further analysis can completed out on where these outlets are and used predict other ‘high chances of success’ regions.
Outlets that have only trial the new product (particularly those that have a large initial purchase) need to be identified and supported with merchandising support to ensure the stock is pulled though by the consumer.
Of course speed in identifying and actioning the metrics around your new product launch is the most critical piece of the puzzle to ensure your new product has the best chance of succeeding.