E-commerce is booming, meaning there’s more new products introduced each day than ever before. So with the industry slated to experience even further growth over the coming years, e-commerce entrepreneurs are looking for ways to expand business and sell more to keep up with the competition.
However, there comes a point when sellers have reached the limits of their market, and decide to enter new markets globally, or introduce new products to their existing market in order to boost sales. While neither of these strategies is always going to be the right fit for all e-commerce stores, sellers can do the proper research in advance to ensure that they pursue the strategy that supports e-commerce growth in the most efficient way.
Continue reading below as we discuss why an online store would decide to introduce new products, and the stages you’ll need to take in order to do so successfully.
Introducing new products seems like a great way to bring in more sales and support e-commerce growth, though this must be done with the proper strategy in order to be effective and worthwhile.
This is because 95% of the consumer products that are launched each year fail. This doesn’t mean that each of these products are necessarily bad, but it does mean that many of these businesses didn’t do the proper preparation and product promotion to make sure their launch was successful.
You can offer the best products on the market, but if you don’t introduce them at the right time or place, or do enough marketing to build interest around the launch, you likely won’t get the results you hope for. Plus, a failed product launch could even taint your brand reputation going forward, impacting your long-term success.
Thus, adding new products or categories to your store can be effective to boost sales and better meet the needs of your customers. So if you don’t have the resources or time to invest in your launch strategy, it may not be the right time to introduce new products. However, you can take the following steps in order to create a successful new product launch strategy and support e-commerce growth.
To begin, a good product launch will be based on customer research into the actual demands and desires of your audience. Without this step, you could be introducing a product that doesn’t actually resonate with your clients, or won’t be received well coming from your brand.
Many product launches come from customers voicing demand for certain products, or making suggestions about additions to the store. Thus, you should listen to what your customers are telling you, and work to satisfy their needs in the best way possible.
Even if you’re drawn to the idea of a certain product that is growing in popularity, but your research tells you customers wouldn’t be interested, you may want to steer away from the idea. So, do some surveys among your customers to see their likelihood of purchasing the new product, why they would buy it, and what types of problems it solves in their lives.
Using these responses, you can decide to go forward with the launch, and it can even help you direct your promotion strategy when you understand the value the product brings to consumers.
Once you’ve narrowed down on the new products you’d like to introduce and have backed up your reasoning with customer research, you can begin to analyze the competition you’ll face. You likely have already identified who your competitors are given your existing product offerings, but if you’re entering a new product category, you’ll likely need to reassess who your peers are.
At this point, you can see whether there’s too much competition in the space and not enough potential to grow your business with the given product. Or, you can take ideas from existing sellers and see the ways that you could make improvements to their offerings.
Before going forward, you’ll need to identify what your store will do differently in order to successfully launch the new product and boost sales. Essentially, why would consumers pick your store over the competition?
This assessment will help guide the rest of your product launch strategy, or may even help you recognize when an idea is not worth pursuing altogether.
With your customer research and competitor analysis out of the way, you can begin developing and testing out the new product. This can be a costly step, which is why it should only be done once you’ve determined that it’s a worthwhile avenue to expand business and boost sales.
Working on the development of the product and running tests on it will ensure that you’re not putting out a defective product on the market. So if you don’t take this step seriously, you could harm the strong brand reputation you’ve built for yourself by rushing the launch of a product before it was ready.
At this point, you may want to hire beta testers who can try out the goods to give you feedback and help you improve the product if needed. The last thing you want is to provide a faulty product to customers that will result in dozens of complaints and returns. So, it’s best to take your time and only launch a product once it’s ready.
During the planning stages, you should also start to make some financial forecasts and crunch the numbers on how much you expect to make off the launch. At this time, you will work on setting a price point that will keep customer demand high, but also bring you a good profit margin to make the launch worthwhile.
It may sound obvious, but if you realize you can’t set the price point high enough to balance profit and customer demand, you may need to go back to the drawing board with your new product launch.
So, take a look at your existing products to see the historical sales volume, profit levels, and make adjustments based on the research you’ve done for your new products. If you expect to sell more, or that demand will be higher than for your other products, you may be able to justify a higher price point. Either way, you need to be realistic with your expectations so you can avoid a disappointing launch, and set a budget for how much you can spend on promotion and other costs ahead of the launch.
Once you’ve taken a look at the numbers you expect to bring in from your product launch, you can use your set marketing budget to create a promotional plan that will generate interest and demand for the new product.
This is one of the most important steps, as you can focus all the time and effort on creating a great product and ensuring it’s something customers want, but if you don’t know how to promote it properly, the launch could fall flat.
So, it’s important to get started with marketing efforts before the launch in order to build up customer intrigue. Some stores may choose to run a pre-sale to gauge customer interest before ordering the inventory. This can be a great way to ensure you’re being realistic with the interest in the new product, and don’t end up with too much or too little product come launch day.
You can build up anticipation in a number of ways in hopes to sell more on the launch, like:
In order to grow your business with the new product launch, you’ll want to make sure you have a good supply chain in place to ensure the products get to you or the customers in a timely fashion. If your suppliers won’t be able to fulfill enough goods given the demand you expect, or the logistics of your new product will be too complex, you may need to re-think the feasibility and timing of your launch.
Maintain good and open communication with your vendors to ensure you’ll have enough product, and how you can go about ordering a new shipment when you need more stock. This is especially important when you have a successful launch and need more products than you initially anticipated.
All the above steps have led you to the actual launch date! With each of these aspects taken care of, you can expect a smooth launch that will resonate well with your audience. No launch ever goes completely according to plan, so be flexible with your expectations and expect some friction. However, all the preparation work you did will help you immensely to sell more products and boost sales from your launch.
The most important detail here is to stick to your launch date once you’ve set it and communicated it with customers. They will be understanding to some extent, but you can’t expect each customer to accept a later date, especially if you’ve built up a lot of hype around the launch. This is why you do so much prep work ahead of time, to ensure that you’re fully ready come launch time.
There are many parties involved with the launch, including suppliers, media outlets, customers, and employees, so keep your promise to them and understand all the implications of sticking to your launch date.
Once the product is finally live and your customers are beginning to make orders, the work on the launch doesn’t stop here. You need to keep promoting the new product to make sure all interested parties are aware that the product is now available, and inform anyone in the public who could be a potential buyer.
So, make sure you’re still getting press coverage, posting about the launch on your social media pages, and encourage purchasers to post about their order once they receive it in the mail. Get customer feedback on the new product to see how much they like it and any potential changes you could make for the second version.
A powerful promotion tactic to sell more at this point is to share the product story with your audience, like how the idea for the product came about, the development process, and all the steps that went into the product before the launch. This can show the dedication and care you put into the product, and instills more confidence among consumers that the product is worth the buy.
Entering new product categories and expanding your offerings can be a great way to boost sales and better serve your customers. However, this must be done with the utmost care and planning to ensure a successful launch that will actually promote e-commerce growth for your store.
With the proper preparation, you can create a successful product launch that will bring in more sales, and help you further grow your brand and build a more loyal customer base. As you can see from the above stages, a new product launch doesn’t just happen overnight, and requires a good amount of investment.
Because of this, many online sellers require external financing in order to invest in new products. While there are many financing options available to merchants, asset-based financing is quickly becoming one of the most popular methods. Preferred for its lean documentation requirements, flexible repayment terms, and quick lending decisions, asset-based lending is a great way for online sellers to take advantage of growth opportunities and propel their business forward.
When working with Myos, online sellers don’t need years of business performance history to secure the necessary funding to expand business into new product lines. They can access the cash they need, when they need it. Rather than base our lending decisions on historical performance, we analyze the future potential of your store based on the products you sell and the current marketplace conditions. Thus, we will never require a personal guarantee from you.
Boost sales and grow your business today with Myos asset-based financing to take advantage of all the benefits of being an e-commerce entrepreneur, without the risks.
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