Failure to Launch

Volume 8 Letter 5

Remember the Apple Newton? Perhaps ahead of its time the Newton was the precursor to the Blackberry and PDAs we know today. The Newton had a touch screen, used a pen based stylus allowing the user to write messages right on the display and send them off in a fax or an email. Like today’s Blackberry, you could manage your contacts and organize your calendar etc. Priced at only $1000 and a little too large to fit in your pocket (any pocket) the product got slammed for its bulky size and failure to truly recognize handwriting as advertised. The coffin on this product was nailed shut when Gary Trudeau made it the butt of many of his jokes in his “Doonesbury” comic strip.

The Apple Newton floundered on the market for six years, but product failure was really pre-ordained right in the first few months. Research shows that 80% of a new product’s monthly sales volume at year three will be achieved in the first six to nine months of launch. To put it bluntly if the product isn’t successful out of the gate the likelihood it will ever succeed diminishes rapidly.

Like the Apple Newton, many products get launched into the market place only to slam into a brick wall. Good strategic planning and scenario planning (war-gaming) are key elements of a highly successful product launch. Over seventy percent of new product launches experience delays yet incredibly only seven percent of the launch teams incorporate a crisis plan into their product launch planning strategy. By not planning properly the launch team significantly reduces or eliminates any potential profit the product may have had.

When launching a new product each stage of the planning process must be developed and executed flawlessly. Which customer segments to target, how to distribute the product to them, what sales strategy will best deliver that message etc. must all be planned in great detail.

It is amazing how many new products get launched with a poor or ill conceived strategy. How can we avoid some of these problems experienced by the Apple Newton?

  • Involve marketing early on in pre-launch activities as they can help guide the R&D efforts to the target customer segment. In the Newton’s case the fussy handwriting recognition and the bulky size made this hand held a non starter.
  • Develop strategic plans early in the launch process. As one pharma exec stated “blockbuster products aren’t discovered – they’re built”. They are built with good strategies and flawless execution.
  • Identifying the best customer segments for early market penetration.
  • Focus attention from both R&D and marketing on key customer attributes.
  • Identify all the stakeholders – purchasers, users, distributors, etc and determine what are their key buying criteria. Design the “whole product” to appeal to each customer segment.
  • Aggressively build pre-launch awareness amongst opinion leaders, key stakeholders and the market in general.
  • Spend assertively to achieve record levels of early year sales.

Apple’s Newton was onto something big but they stumbled so poorly out of the gate that they had to withdraw from that market. Do the hard work, plan meticulously – don’t be a “failure to launch”!

1. Based on notes from Thomas Foster of IIBD Ltd

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