By: Amy Heath, Internet Marketing Consultant
In order to identify potential risks associated with new product introduction (NPI), it is important to understand the role of market research, proactive marketing efforts and communication to properly assess the impact of risks to your practice. Many of our clients work with Page 1 Solutions and other vendors to promote new products and services. Although it's tempting to adopt a "set-it-and-forget-it" mentality when it comes to marketing, you, your team and any marketing companies you engage for NPI campaigns all have a stake in maximizing the benefits and reducing the risks of adopting this product. The same risks are not likely to apply to all stakeholder groups and the impact of some risks may present a greater financial threat to the company, thus demanding a higher priority in risk management planning. For example, any risk for internal stakeholder groups presents immediate, negative impact and may actually disallow new product introduction, ultimately impelling potential for the worst possible risk: terminating relationships with internal or external stakeholder groups.
Risk mitigation planning is the process of developing options and actions to enhance opportunities and reduce threats to project objectives. Only by properly identifying potential risks will it be possible for a company to assess potential impact and prepare to train others on how to mitigate these risks. Risk mitigation begins with market research, often performed by an outside marketing company; as part of an iterative process, a risk tracking tool should be implemented and referenced daily to record the results of risk prioritization analysis. This type of tool provides input for both risk mitigation and risk impact assessment. The risk mitigation step involves development of mitigation plans designed to manage, eliminate, or reduce risk to an acceptable level. Additionally, activity cost estimate reviews are useful in identifying risk as they provide a quantitative assessment of the likely cost to complete scheduled activities and ideally are expressed as a range, with the width of the range indicating the varying degrees of risk for the company.
Risk Mitigation Planning
To effectively address the previously identified risks, members of internal stakeholder groups must communicate with marketers to provide an overall NPI strategy and goals supporting that strategy. Marketers must remain operationally nimble throughout the project, responsive to company needs and feedback. The highest priority for risk mitigation among internal stakeholders should be given to marketing employees and strategic marketing partners, in order to generate mass appeal and properly forecast new product demand. Ineffective marketing prior to launch, potentially caused by insufficient understanding of target demographic or improper NPI campaign messaging could be disastrous for the company. Obviously, the best approach to mitigating this risk involves the proper budget allocation to support market analysis and campaign reach.
Whenever possible, developing a specifically assigned risk management team to be part of a larger project team is highly advisable in order to achieve NPI goals. From the outside perspective, the ultimate definition of success or failure for a new product launch often lies within customer satisfaction. Understanding, evaluating, defining, and managing customer expectations are key components of market analysis and NPI success. This requires a combination of conformance to company standards to ensure the project produces what it was created to and assurance through marketing efforts that the new product satisfies a real need presented through clear and consistent campaign messaging.
By bringing personnel from all potentially impacted groups together to form an interactive, cross-functional team, issues can be discovered and resolved more effectively than they otherwise would. A stratified marketing communication plan between many teams requires many more planning sessions and has a high probability of communication breakdown. Because of their interactive nature, well-facilitated planning sessions for a cross-functional team tasked with supporting NPI can lead to increased stakeholder consensus and ultimately better product launch.
If you are launching a new product and need to discuss marketing recommendations with experienced digital marketing experts, call Page 1 Solutions at (303) 233-3886 today.