It is often said that countless new products are launched each year, yet 99% fail. What exactly causes such a high failure rate? Factors such as product positioning, pricing and margin structure, selling points, and promotional investment are certainly among the various reasons, but the execution capability of the marketing team cannot be overlooked as an exceptionally important factor for success or failure. This article will explore how to ensure execution during the new product launch phase and thereby improve the success rate of new product launches.
Seven Execution Problems in the New Product Launch Phase What kinds of execution problems arise during the new product launch process? Li Zhengquan summarizes the common problems into the following seven categories.
Lack of Execution Skills: Not Knowing What to Do I once served as a marketing consultant for a soy milk company. In the first two years, this company launched a high-protein soy milk with protein content ≥2%. However, after the launch, the distribution speed was slow. Why was it not ideal? Let's listen to the questions that salespeople asked me during a special meeting on the new product launch phase. "Mr. Li Zhengquan, I want to ask, 'If the company has no display budget, how do we get products on shelves?'" "Mr. Li, my question is, 'How do we solve the problem where store owners prefer to promote a product that earns only one mao per bottle, rather than our product that earns one yuan per bottle?'" ... The questions were numerous. But in summary, the majority were cases where they faced problems and didn't know what to do. Yes, a new product launch requires distribution, and to distribute, our salespeople must know how to solve various problems and execute the distribution. Otherwise, the lack of execution skills becomes a major hindrance to new product distribution and shelf placement. This is particularly prominent for new companies operating new products and newly formed sales teams.
Knowing What to Do but Not Wanting to Do It Compared to execution skills, the problems in the marketing team's execution willingness and attitude are another significant issue affecting the success of new product launches. In the past, mature markets for old products had relatively stable sales, and distributors were familiar and adept at operating them. New products, however, require a market introduction and cultivation period before generating substantial sales. In such cases, people tend to "do what they know rather than what they don't," making it more likely they stick with familiar products. Relative to this problem, those labor-intensive and meticulous tasks are often neglected by salespeople who are accustomed to focusing on big, easy, and rough tasks. For example, during the new product launch phase, posters are pasted and torn repeatedly, and continuous display improvement and terminal visualization are time-consuming and detailed tasks. These detailed tasks become execution problems that many are unwilling to handle.
Ruthless Targets: Deviating from Execution and Focusing Only on Results Before the new product launch, a set of targets is already formulated, such as: within two months, a certain person in a certain region must complete the recruitment of three distributors in their area; within three months, they must achieve distribution in 70% of target outlets in their area; and they must complete a certain amount of shipment volume based on ex-factory price. These targets are often linked to benefits and positions, forcing everyone to focus solely on results while ignoring the standardized marketing behaviors and rules previously established. For example, regional salespeople may relax distributor selection criteria to meet recruitment targets, allowing distributors with incompatible business philosophies, who do not identify with the company or product operation concepts, or who have other unsuitable issues, into the distributor system. Sales directors may turn a blind eye to various problems to meet targets. In the end, everyone focuses only on temporary target completion, relaxing execution standards or even executing chaotically, causing a new product to be fraught with problems from the start, unable to sustain or even grow.
Insufficient Foresight: Execution Plans Encounter Obstacles After a new product launch, many problems may arise that were previously unimaginable and thus unanticipated. This lack of foresight regarding new product launch issues inevitably leaves the marketing team unprepared for battles, affecting execution. A functional food company that sells through OTC channels launched a new product. After two to three months of distribution, the product flow sheets returned from terminals clearly showed that even natural sales exceeded expectations, with average monthly sales per store surpassing projections, indicating good prospects. To "boil the water" of the new product launch, the company decided to implement promotions in selected stores: in-store tasting by promoters and in-store discounts. However, after a week, sales at the promoted stores barely changed. Where were the problems? Li Zhengquan accompanied the company's vice president of marketing to visit the market and found that the biggest problem was "we didn't expect our promotional activities to be so poorly executed." In-store, there were no floor displays or end caps; the discount notice used a small tag similar to the price tag, with original price, discounted price, or "you save" information not prominently displayed, easily overlooked even when passing by the shelf. Outside the store, the tasting area had no stack of display boxes, only three or four boxed products on the promotion table, with small posters and small text, low attention, and even the promoter playing with their phone when no customers were around. This is why the promotion was ineffective. In fact, the mindset that "we thought this was simple and should be done well" affects not only terminal promotions. Because management is not refined and marketing behaviors are not standardized, those "small things" you assume everyone can do well become obstacles to execution.
Lack of Process Management and Supervision Managers who habitually stay in the office "commanding from the rear," browsing the internet, drinking tea, and enjoying air conditioning, cannot grasp the real situation of new product launches in real time. Even with supervision and feedback, the information they receive is often delayed and second-hand. In such cases, if there is no department or dedicated position to perform supervisory functions, some problems in the new product launch may go unnoticed for one or two months. For example, at Shanqing Beverage Company, during the launch of a new product, it required salespeople in each district to conduct a carpet search of suitable stores, do route visits, and intensive distribution. However, after nearly two months, at a sales meeting, the marketing director discovered that some salespeople often appeared at the easternmost and westernmost points, or the southernmost and northernmost points of their districts on the same day. The company's cold-chain delivery trucks also ran around, "the money earned from daily deliveries was less than the fuel costs." Clearly, Shanqing's new product launch problems were closely related to execution supervision and process management.
Lack of Planning in Execution When starting to recruit distributors, the recruitment manual is not ready; when starting distribution, the supplier of small gifts for store owners and staff has not delivered; when launching promotional activities, the distribution rate is not up to standard, and promotional materials are not prepared... In short, either "unexpected" problems occur or things are disjointed. This lack of planning in new product launch execution not only affects the morale and enthusiasm of frontline salespeople and channel partners but also affects the execution of recruitment and distribution plans, inevitably leading to problems and reducing the chances of success.
Inadequate or Incomplete Special Assessment for New Products Many companies that fail in new product launches are directly related to this problem. Always remember: salespeople will only do what you assess—that is, they do what you measure, and those items you do not assess or consider will be selectively ignored. If the new product launch is not linked to the performance of the marketing team and distributor team, the new product will inevitably be forgotten. Typical phenomena include: inactive distribution, inactive distribution, inactive sell-through, inactive market maintenance, and inactive cooperation and execution of headquarters' new product launch activities.
Hold Fast to Execution: Unyielding as a Mountain Who would promote a new product that cannot succeed? But have you provided sufficient execution guarantees for the successful launch of your new product? Now, let us hold fast to execution, unyielding as a mountain, to promote the success of new product launches.
Anticipate Problems Early and Prepare Plans, Understand Key Points and Hidden Dangers If we divide the new product launch into several stages, there are the new product project planning period, product trial production and debugging, packaging printing and other product preparation period, product launch recruitment and distribution period, and product sell-through attack period. If we break down the new product launch by involved departments, we have R&D, production, planning, sales, and finance. If we further detail the preparation and execution work before and after the launch along the marketing line, we can break it down into even more detailed tasks. In each link or professional area, what are the key matters affecting success or failure? Considering the actual situation of your company and marketing team, what hidden dangers or problems might exist? Think through these issues and prepare plans in advance for high-frequency, high-risk problems. This will help us be well-informed and proceed step by step during the new product launch.
Problem-Oriented Training, Joint Visits, and Regular Meetings to Improve Skills Many companies' training for new product launches and newly formed marketing teams has problems. The typical issue is: heavy emphasis on product knowledge training and general marketing knowledge training, while neglecting customized training for new product launches based on anticipated problems or actual problems encountered after launch. Training meetings during the new product launch phase should focus on the eight characters "successful launch, launch success" (成功上市、上市成功). What helps the marketing team solve actual problems in new product launches is precisely problem-oriented, problem-solving training. However, it is not guaranteed that thinking and skill training will improve every marketing team member's marketing thinking and working methods. To achieve this, we cannot rely solely on "the master leads you in, but practice depends on the individual," completely depending on the team members' own understanding and persistence. Instead, we should ensure that every training has effect tracking, and every meeting has resolutions and problem follow-up. How can we track effectiveness? Important methods include: First, skill competitions on the trained knowledge—use sales contests to strengthen the application of trained skills; Second, track and collect improvements in sales problems corresponding to the trained knowledge, and promptly remind and awaken skills; Third, conduct assessments to help the trained knowledge become skills for each team member—conduct 2-3 "exams" two weeks and one month after training, combined with the effectiveness of solving corresponding sales problems, for comprehensive evaluation, and give rewards or punishments based on performance; Fourth, designate those with strong knowledge and skills and willing to share as internal mentors to provide targeted coaching to colleagues with weaker professional skills. Of course, the other two important aspects are joint visits and regular meetings. For irregular or regular joint visits, not only is it beneficial for us to observe the training effects on the front line, but more importantly, we can closely observe the strengths and weaknesses, habits, and behaviors of the accompanied salespeople, allowing us to point out problems in time, give suggestions for improvement, and teach and practice through words and deeds. For sales meetings, we can also have top performers and skilled individuals share their experiences in applying skills after training, or have them speak from personal experience—of course, this is just one content item that can be arranged in sales meetings.
Matters, Time Points, and Responsible Persons: Put Everything on a Table for Promotion Earlier, we mentioned the need to anticipate problems. Since we need to anticipate problems, marketing managers should list the problems they foresee, especially important ones involving time nodes and responsible persons, into a "New Product Launch Success Promotion Table" or a "Gantt chart," and post it on the wall, clearly showing what should be completed by a certain department/region/person on a certain date. Through clear positioning on the matter table and timely work checks, we can keep ourselves in a clearer and more orderly planned state, knowing what has been done, what has not been done well, who, where, and when has lagged behind, and promptly find solutions to get back on track. We can enable every member of the marketing team to work with us to urge or help those who lag behind, stimulate the competitive spirit of individuals and sales branches, and promote the successful launch of new products with more "positive energy."
Key Matters and Nodes: Supervise Execution and Manage the Process A Gantt chart alone cannot manage everything. To better ensure the success of new product launches, we must pay special attention to the execution of key matters at critical time nodes and manage their execution processes. But what are our key matters and nodes? After a new product officially starts its launch, apart from advertising and promotional investments that most marketing directors and managers cannot ultimately decide, the recruitment completion rate, distribution compliance rate, target audience reach of advertising information, and cooperation and execution of promotional activities are key factors affecting the success or failure of the new product launch. We need to lock onto these, maintain sensitivity to execution problems, track the execution process, and intervene and control to an appropriate degree. Once execution problems occur, we need to correct, optimize, and improve them immediately.
Frequently Visit the Frontline to See the Truth, Identify Problems Early and Correct Them To grasp the true execution of key success factors in new product launches, the best way is to leave the office and maintain a certain "frontline appearance rate." Only by doing so can we discover problems at the first time and handle them at the first time. In Li Zhengquan's view, from this perspective, managers who habitually stay in the rear to remotely control the market and marketing team are dangerous, and new product launch companies with such managers are also dangerous for both the new product and the company.
New Product Assessment Must Be Linked: Increase Attention and Facilitate Implementation Under the execution ecology of "you assess what I do," for a new product to receive attention from the marketing team and distributor team, and to make them act and quickly complete distribution and shelf placement plans, terminal visualization display plans, advertising and promotion plans, sell-through and subsequent restocking plans, it is necessary to add performance assessments directly linked to new product launch indicators. What are the key performance indicators for new product launches? The distribution outlet compliance rate, barcode distribution completion rate, terminal visualization qualification rate, etc., mentioned earlier, are the indicators to pay attention to. Of course, considering the feasibility of performance assessment, if we cannot set up a separate set of performance indicators for new product launches, we often need to adjust the previous assessment indicators. But in reality, even if we only add one indicator, such as new product shipment rate, to the marketing team's old assessment indicators, or even if we only add one indicator, such as new product order compliance rate, to the distributor team's old assessment indicators, we can better guarantee the path of new product launch.
[Reprint note] This article is from [Business Trends], excerpted from Li Zhengquan's (WeChat: lizhengquan01) forthcoming book "Leadership Execution" (tentative title, or "Marketing Execution")
Reply with the following keywords to categorize and query related professional articles: Sales Supervisor, Second-tier Management, Regional Manager, Distributor Management, New Channels, City Manager, Competition, 2015, Manufacturer-Dealer Game, Product Stagnation, Terminal Visit Management, Route Management, Deep Distribution, Internal Management, Sales Skills, Profit Improvement, Recruitment, Distribution, Daily Management, Team Motivation, Trade Promotion, Sales Misconceptions, New Product Launch, Township Market, New Product Pricing, Sales Target Achievement, Closing Deals, Market Visit Inspection, Baijiu, Beer, Sales Increase, Agency Products, Cross-region Sales, KA, Terminal Visualization, New Market, Market Operation, Learning, Book Recommendations, Inventory Management, New Salespeople, Consumer Promotion, Execution, Old Products, Expired Product Handling, Model Market, Recruitment, New Media, Distributor Development, Performance Assessment, Assessment, Annual Planning, Shopping Guide, Morning Meeting, Display, Transformation, Pressure Stock, Holidays, Distributor Cost Control, Channel Operation, Marketing Theory and Laws, Brand Truth, Order Meeting, Team Management, Training, Debriefing, Debriefing Report.