Member Article

22 Ways To Develop New Products And Services

Are you thinking of developing new products or services, but are not sure where to start? Here are some tips to help you to establish systems to generate, screen and test out ideas.

New ideas don’t always come naturally. They may be the result of following a systematic process, with lots of team input along the way. It makes sense then that the more an organisation can foster a creative and dynamic environment, which is open to a multitude of sources, the more likely it is to generate ideas. A bit like creating a brand new recipe, which can be down to the addition of one new ingredient, a different combination of existing ingredients, or even the personal touch of a new Chef.

Fully utilise your internal resources

• Build feedback into your reporting – the sales or customer services team is in a prime position to highlight any gaps in your portfolio and to suggest areas of improvement. Try brainstorming at sales meetings, or include a section to capture new ideas in monthly reports.
• Create an employee suggestions scheme – make this company-wide to allow for different perspectives, but ensure that someone co-ordinates responses. Providing some background on company goals may be helpful, as long as it is not too restricting. Acknowledging all contributions may encourage participation, so consider an award for ideas that are taken forward.
• Re-visit previous company research/ projects – it may not be a case of re-inventing the wheel. A change of personnel may mean that former work is forgotten, but this may still prove to be a source of inspiration for new product ideas.
• Share knowledge with partner/sister companies – they may be able to bring particular technical expertise or experience to a project, but in a non-competitive environment, with common goals.

Make sure you have a supportive organisational structure in place

It certainly helps if your organisation encourages creative thinking, enabling different departments to interact positively and ensuring that high priority is given to new product development.

• Establish a concept development team – ideally, this should be a cross-section of representatives from across the business – e.g. technical, production, design, commercial and financial, with members rotating periodically. New product development then belongs to the organisation as a whole, as opposed to a specific department, depending upon the nature of the products or services.
• Appoint a co-ordinator(s) - at least one team member should be responsible for monitoring all inputs, so that an overview is retained. This provides an effective reference point, since not all ideas may be able to be taken forward straight away.
• Create a market information system – this area is key and involves gathering industry and competitor information through a variety of different channels. The system should be centrally co-ordinated for maximum effectiveness and could encompass:
  • a structured reading list of consumer and trade magazines, business journals and newspapers. Since some markets may be more advanced than others, also consider relevant international publications
  • visiting consumer and trade exhibitions – ensuring feedback is circulated around the organisation
  • customer and prospect visits
  • monitoring competitor activities, e.g. product launches and strategic moves, both within the UK and overseas
  • investigating any licensing opportunities for UK distribution of international product ideas, or joint ventures, or studying patents to identify any new product gaps
  • identifying any company acquisitions that could be of strategic interest

Some practical tips for generating new ideas

• Brainstorming sessions and ‘think tanks’ – sessions could equally use internal or external resources, such as employees or customers, but should ideally be held away from site, to minimise any distractions.
• Analysing gaps - by studying the existing range of products on the market and those of competitors, and then plotting them all on a grid to reflect the various consumer needs that they fulfil, you may spot some gaps to exploit.
• Product attribute checklists - examining each individual component of your products/services in turn, and the added value to your customers, may lead you to understand where you can add even more value. You may ask customers to rank the relative importance of each criteria to arrive at the ideal combination of product attributes.
• Different user perspectives – take into account different audiences for the product (e.g. consumers or trade customers) and their specific customer journey. Break their experiences down, for example if you offer a tangible product, think about practical handling, functionality, aesthetics, storage etc. Is there a gap in the market?
• Analysing segments – is there scope to market your existing products to a different sector? New ideas may therefore be centred more on targeting an alternative sector. Or can you provide additional services for an existing product in an already established marketplace?

Draw on external resources – but set a budget

Not all the answers are likely to be provided in-house. Additional areas to consider include:

• Gathering customer/prospect feedback – monitor satisfaction levels, comments and complaints, whilst formalising discussions with key players. Consider a regular, quarterly survey, where feedback can also be used for PR purposes. Approaches might consist of:
  • pre-arranged depth interviews, on a one-to-one basis – either face to face, or by telephone, to provide insights into why customers/prospects want/may want to buy your/your competitors’ products, or, why they don’t – what makes you different?
  • group discussions to stimulate creative ideas
  • customer or user panels to regularly review and trial new products
  • quantitative studies to amass statistical evidence on the appeal of specific new product ideas (dependent upon confidentiality issues)
• Set up supplier development groups – material suppliers are also close to the marketplace and their technology may also be involved in the delivery of any new product development initiatives. Consider strategic partnerships to stimulate ideas (with relevant confidentiality clauses).
• Foster student projects – universities and colleges may be able to set up collaborative projects, a win-win situation which can help students to develop their portfolio and provide your organisation with fresh ideas. Consider running a competition to generate ideas.
• Involve creative agencies – don’t assume that everything has to be in writing – ask for some visual suggestions for new products, which could also be used as a potential talking point with customers.
• Consider inventors/ consultants – whilst potentially providing a source of great inspiration, using external inventors may ultimately cause legal problems over ownership of the idea and the marketing of the finished product. However, it may stimulate a novel approach.

Establish an agreed process for screening and prioritising ideas

Formalising the generation and screening of ideas may encourage suggestions for new products and services. Your screening process should however ideally be reviewed at least once per year, to ensure alignment with corporate objectives and to confirm that nothing is missed. Areas to consider include:

• Corporate fit – objectively rank ideas on how well they fit with company goals:
  • target ROI
  • projected volumes and revenues
  • development and investment costs
  • impact on existing products, markets and customers
  • relative company resources
  • relative company strengths, weaknesses, opportunities and threats (SWOT)
• Market novelty – assess ideas on the perceived degree of innovation which they bring to the marketplace and if they open up new opportunities (research may be required early on).
• Undertake concept research - a high level of compatibility with company targets and resources means that the strongest ideas may proceed to concept research with potential users. Similar groups could also be used at various stages to further develop the product through to prototype or market testing.
• Find ways to improve your screening, testing and development process with a view to reducing your overall time to market - after each concept development, or product launch, try to review as a team what worked well and where you could improve, but consider a qualitative, as well as a quantitative approach, since it is not always about data.

Gut instinct also goes a long way

A final note of caution, not all product ideas and developments can be totally formalised.

• Ensure that you allow for some creative and commercial flair – there may be no need to over- rely on testing at every stage. Some products may be so innovative that they may actually be ahead of the market. Slow reaction time, for example through over-use of research to justify activities, may result in a fantastic idea being lost – or worse, introduced by your competitors!

For further ideas on new products please visit www.freelance-marketing.com

Lorraine Davidson is a Fellow of the Chartered Institute of Marketing and has held roles in both marketing and market research for over 20 years, working with organisations in both the business to business and consumer goods sectors.

She set up Freelance Marketing Ltd in 1998, an independent marketing consultancy based in Richmond, North Yorkshire, which operates as an outsourced marketing department, providing market research, planning and project management of communications services. The company offers a very hands-on, creative approach to projects.

Freelance Marketing Limited, 2 Lawrence Crescent, Richmond, North Yorkshire, DL10 5QE

Tel: 01748 822063

Since all businesses have specific requirements, this article should be used for background guidance only and should not be interpreted as one to one, personal business advice. For this reason, no liability can be accepted by Freelance Marketing Ltd.

© Copyright Freelance Marketing 2014

This was posted in Bdaily's Members' News section by Freelance Marketing Ltd .