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Commercialization of a product

Commercialization of a product means launching a new product into the market. This is often considered post-NPD (New Product Development). This includes activities to ensure that projects have a clear market, customer and business focus, and development and implementation of sales and marketing strategy.
  1. Launch the product
  2. Produce and place advertisements and other promotions
  3. Fill the distribution pipeline with product
  4. Critical path analysis is most useful at this stage

In this stage, the product is launched, advertisements and promotional activity begins and increases heavily, and the distribution pipeline is filled with the product. The actual launch of a new product is the final stage of new product development, and the one where the most money will have to be spent for advertising, sales promotion, and other marketing efforts.

It is often confused with sales, marketing or business development. The Commercialization of a product has three key aspects:

  1. The funnel. It is essential to look at many ideas to get one or two products or businesses that can be sustained long-term
  2. It is a stage-wise process and each stage has its own key goals and milestones
  3. It is vital to involve key stakeholders early, including customers

Commercialization of a product will only take place, if the following three issues are satisfied:
  1. Timing of launch

    : When facing the danger of cannibalizing the sales of the company's other products, if the product can be improved further, or if the economy is down, the launch should be delayed.
  2. Launch location

    : It can be in a single location, one or several regions, a national or the international market. This decision will be strongly influenced by the company's resources, in terms of capital, managerial confidence and operational capacities. Smaller companies usually launch in attractive cities or regions, while larger companies enter a national market at once. Global roll outs are generally only undertaken by multinational conglomerates, since they have the necessary size and make use of international distribution systems (e.g., Unilever, Procter & Gamble). Other multinationals use the "lead-country" strategy: introducing the new product in one country/region at a time.
  3. Target consumers

    : The primary target consumer group will have been identified earlier by research and test marketing. This primary consumer group should consist of innovators, early adopters, heavy users and/or opinion leaders. This will ensure adoption by other buyers in the market place during the product growth period.
The company has to decide on an action plan for introducing the product by implementing the above decisions. It has to develop a viable marketing-mix and create a respective marketing budget. When a plan is in place for each of these three issues, then the Commercialization of a product may begin. Our approach includes the following elements:
  1. Evaluate product cost and performance. What are the estimated costs of producing the product or service, and what is likely operating performance when introduced to the market? Is there an anticipated "learning curve" as the client gains production experience over time?
  2. Estimate market potential. Work with the client to develop a credible model of product and service markets, and simulate the likely purchasing decisions made by customers, given the product's attractiveness relative to competitive offerings.
  3. Identify key performance targets. Using the results of the market models, explicitly quantify key technical and market uncertainties, and identifies the most critical performance targets for achieving successful commercialization.
  4. Assess multi-party financial impacts. Consider the costs and benefits to all parties who can play a role in successful Commercialization of a product - producers, customers, suppliers and taxpayers - to better understand the incentives and impediments to commercialization faced by each party.
  5. Design incentive structures. Carefully designed incentive structures among parties - such as tax incentives or other risk-sharing agreements - can often improve the chances for commercial success.

Marketing decision models

 

Business strategies definition

  1. Market and product development
    1. Beta testing
    2. Market research testing
    3. Commercialization of a product
      This is often considered post-NPD (New Product Development).
  2. Business and revenue model
  3. Positioning and differentiation
  4. Multi channel distribution
    'With each new sales channel, a company expands its sales and market coverage'.
  5. Multi channel communication
    The goal of writing multi channel communication plan is to get an audience to invest their time, money or efforts in a product or service.
  6. Marketing communication mix
    The importance of online service for some organisations are indicated by bank Nationwide.
  7. Organisational capabilities
 
  1. Idea generation
    1. Opportunity analysis
      The strategy of assessing the potential for a change or enhancement to enhance the generation of revenue.
  2. Idea screening
  3. Business analysis
    1. Break even analysis
    2. Benefits of break even analysis
    3. Fourt Woodlock equation
      The tool used to determine whether the product idea will be profitable or not.
  4. Critical path analysis
  5. How to make critical path analysis?
  6. Critical path in business
  7. Logistics strategic plan
    Logistics is how to get raw materials, move them in the system, distribute and replace them.
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