How To Market A New Product
So you've invented the next great gadget, and you're sure it'll be a hit. In fact, you've got cartons of inventory stored in every room of your house that you're itching to sell, sell, sell. Your test market said they love it, but how can you reach the legions of consumers you're sure will want to buy it?
Welcome to Sales 101. While there are countless books you can read about sales and marketing, here's a relatively simple, proven strategy that'll teach you how to market a product and grow your sales.
Create a Sales Plan
First, define your market as accurately as possible so you have a deeper understanding of exactly who you're selling to. For example, instead of all women, it may be working women with above-average incomes and kids under age 5. Instead of all men, it may be divorced men in their 40s with six-figure salaries. The more specific you get, the more accurately you'll be able to target your sales and marketing efforts, choosing the sales channels most receptive to your product.
Next, you'll need to develop a sales plan. Before you groan, "Another plan," understand this can be a simple document for your eyes only that'll help you organize and think through your sales strategy. Write it in a way that makes sense for you. Typically, it should include the following:
- Sales goals: These goals should be specific and measurable, not something like selling a million units. Base them on the nature of your product and try to break them down into manageable parts. For example, sell 50 units to end-users in 30 days and sell 100 units to local independent retailers in six months.
- Sales activities: These are your tactics--how you plan to make the sale. You may say you'll sell direct-to-consumer through a website or via craft shows, for instance. Or this part of the plan may include activities like developing a sell sheet to send to independent retail stores.
- Target accounts: Your sales plan should also include the accounts you want to sell to. If it's end-users, for example, plan how you're going to reach them through eBay, classified ads or your website.
- Timelines: Put dates to all of the above elements so you can define your steps within a realistic timeline. Don't forget that your timelines should be fluid--if you're underachieving, your sales plan can help you figure out why and define the corrective steps you need to take.
Finally, follow a proven process for growing sales over time. While it would be fabulous to have Wal-Mart carry your product right out of the gate, it may not be realistic. Most large retailers want to see a track record of successful sales before agreeing to take on a new product.
Build Your Market
To learn how to bring a product to market, begin by selling directly to end-users. This'll give you confidence that there's demand for your product and will also create referenceable customers that you can contact for product and packaging feedback before you hit the bigger leagues. So where can you reach your end-users?
The web is one highly effective channel, and you can reach your market through your own website or via a site like eBay. You can also tap into your own personal network as you begin. Host a home party to share your product with friends and friends-of-friends, sell through local community groups and e-mail your network.
Once you get feedback directly from your customers, refine the packaging and price point before approaching your next market--wholesalers. You'll probably start with small, independently owned, local stores. It's a good idea to start with them before hitting larger chain stores because it's easier to get in touch with the direct decision-maker, and they're more inclined to take on new, unique or hard-to-find items to differentiate themselves from larger stores. To sell to these retailers, be prepared and bring a product sell sheet, photos, product samples (if possible) and a succinct introductory letter to explain what's in it for them, highlighting your product's profit margin, features and benefits, and proven sales record.
Expand to New Markets
Once you've established sales strength with independent retailers and are ready to support new markets, it's time to sell to the big guns. Of course, exactly who those big guns are will depend on your product. For some, it's powerhouse general mass retailers, like Wal-Mart and Target, while other products will fit more specialized but equally powerful retailers, like Williams-Sonoma, The Sharper Image and Sephora.
Note that when dealing with these major accounts, the sale is just the beginning of the deal. Handling fulfillment, returns, rollbacks, slotting fees, advertising and more will require strengthening your business's infrastructure and resources.
But back to the sale. What's the best way to approach a larger retailer? Here's a quick cheat sheet:
- Get the correct buyer: One of your biggest challenges is finding the right buyer within a large organization, so do your homework. If you're experiencing roadblocks, consider hiring a distributor or manufacturer's rep who already has established relationships in your industry.
- Be prepared: Develop a presentation and have professional-looking sell sheets ready. Your product should also have packaging that's ready to go.
- Know your target: Understand what products they already carry and how yours will fit in. Don't waste your time pitching to a retailer who's unlikely to carry your product.
- Take advantage of special programs: Some mass retailers, such as Wal-Mart, have local purchase programs that give managers authority to try local items. And other retailers may have different initiatives, such as minority business programs.
- Be patient: It can take up to a year or longer before you see your product on store shelves, so don't get frustrated. And if the final answer is no, try to turn it into a learning experience.
Finally, remember there are other sales channels besides the traditional brick-and-mortar retail store. Catalogs, TV shopping networks and online stores can also be excellent methods to enable you to learn how to market a product online.