Ron Sidman has spent most of his adult life in the juvenile products industry. Motivated by his interest in parenting and child development, he created the parenting lifestyle oriented brand, The First Years, and was Chairman, President, and Chief Executive Officer until the company was sold in September of 2004 to the RC2 Corporation for $162 million. Ron is now acting as a business consultant to industry CEO’s through JPMA’s CEO Mentor Program, and executive blog, the CEO Play Yard.

When you come up with a new product idea, you can’t help but fall in love with it. But before you start investing real money, it’s wise to make sure that your target customers are as excited about it as you are.

 
In my role as business adviser to companies inside and outside of JPMA, I’m exposed to a lot of new product ideas. In some cases, I might be working with a start-up with just one product and in other cases it’s an established company trying to expand their existing line or enter a new category. I love it most when I get brought in early before a lot of time and money has been invested in the new concept. Unfortunately, too often what I see are products that are well along the development path or even tooled up and in stock but just not unique or “wow” enough to be successful. The client is still hoping I can give them the magic solution that will enable them to be successful. The problem is it’s usually too late.

 
Whether your company is well-established or a startup, there is no reason not  to optimize the likelihood of new product success. Here’s some of the advice I give to my clients:

1. Do your background homework up front.
Product development is not for the faint-hearted or weak-disciplined. You really ought to become as much of an expert in the product category as you can before you get too far down the road. Think of yourself as a detective diligently looking for information and clues. Your early development checklist should include questions like:

• What consumer problem are we solving and is it a serious enough problem that customers are really desperate for a solution?

• Who are the targeted “users”, “payers”, and “influencers” including age, income level, lifestyle, geographical location, etc.?

• How do the “payers” make their buying decisions? Ask them directly and also go to stores and watch them shop.

• What are all the key competitive products, which are the big sellers, and why?

• What’s the revenue potential for your product?

2. Make sure you have a significant competitive advantage and that it’s easily communicable and sustainable.
It’s not enough for your new product to be slightly better than the competition, slightly cheaper, or slightly anything. You need a “Wow, when can I get one of those?” kind of reaction from potential consumers that see your sketch, sell sheet, or prototype. Unless and until you get that, go back to the drawing board and figure out how you can add more value.

 
Test to make sure customers “get it” quickly and easily. Make a sell sheet that contains the information that would be on your package as well as the retail price. If potential purchasers don’t understand the benefits and superiority right away just by looking at the sell sheet, you’ve got a problem to solve. You could test using a video as well as long as you think you’ll get wide consumer exposure to your video when you go to market.

If your product is successful and can be readily “knocked off” by competitors, it will be—fast! It’s a tough world out there. What’s your protection? Create as many obstacles to imitation as you can—patents, copyrights, trademarks, secret sauce, etc. And, once you’ve launched the product, don’t ever stop trying to come up with added value improvements or cost reductions that will keep competitors in a chasing your tail mode.

3. Understand the necessary channel and roll out strategy.
Back in the 90’s, my company had what we thought was a blockbuster new product—the first ever instant-reading, digital, underarm thermometer for infants. We knew parents didn’t like taking their baby’s temperature with rectal thermometers and we got an overwhelming positive response to the concept from parents in our market research. Not only did parents like it but retail buyers went gaga. We had instant distribution in every major national chain. Just to make sure the product flew off the shelves from the get go, we even did a national advertising campaign in baby magazines to support the launch. The result? A total dud.

 
We realized too late that since the product was a totally new concept that no one had seen before, it needed time to gain traction with parents. The overnight distribution success was the worst thing that could have happened. When the product didn’t sell well in the first few weeks, every retailer dropped it. New ideas, even if they’re good ones, sometimes need time to catch on. It took five years for the Avent bottle to become a hit. We always wondered what would have happened had we started on a small scale with specialty stores where the product could have been explained and where we would have had more time to get to the “tipping point.”

The lesson is even a “wow” idea can fail. You need to understand which distribution channel is best to communicate the superiority of your product and you may need to be patient for a while to let word-of-mouth start to build.

Next Steps
Take a hard look at your product development process if you have one and make sure that the hurdle that new product ideas need to jump over is sufficiently high. As difficult as it can sometimes be, ditch the product ideas that have only a marginal competitive advantage and focus your time and money on the clear winners.

 
If you’d like more detailed information or customized guidance regarding best practices in product development or about other management issues, please set up a Skype session with me by contacting Kyle Schaller at kschaller@jpma.org or sign up on the JPMA website. Your first session is free and subsequent sessions only cost you a $150 charity donation.