The research behind successful product launches

The stats say it best.

Numerous studies have documented that more than 60% of new products fail, which makes launching a product a significant challenge for any company. It’s not innovation that’s the issue; it’s what comes next. BI WORLDWIDE talked to Michael Ahearne, professor and the C.T. Bauer Chair in Marketing at the University of Houston and the Research Director of the Sales Excellence Institute, about the difficulties to successfully introduce a new product into the marketplace and what companies can do to overcome the obstacles.

BI WORLDWIDE: Dr. Ahearne, what are the barriers to selling what you call “new-to-the world” products?

Dr. Ahearne: My colleague, Thomas Steenburgh, and I found, through several studies including a survey of 500 salespeople at B2B companies, there are three issues salespeople face when bringing a new product to market:

1. It takes more time to sell something new. Customers need to be educated and new products require explanations. In fact, salespeople spend 35% more time in the sales cycle with customers when selling new products. Time is money so organizations may want to consider special incentives that are commensurate with the effort.
2. It’s harder to close the sale. While clients are open-minded to hearing about new products, ideas or solutions, they feel the risk of being early adopters. Sales people can secure meetings but in the end, they might not have anything to show for their effort. Companies may consider offering incentives to sales people for getting appointments (steps to the sale) and should also consider rewarding early sales.
3. It requires learning beyond features and benefits. It’s easy to get excited about what the product, solutions or service can do, but the training that gets ignored is understanding and developing a profile of the ideal customer. What type of buyer will take a risk? What cultures will support change? What behaviors indicate purchasing cues? It pays to develop training that goes deeper than the bells and whistles.

BI WORLDWIDE: What are some key traits you see in salespeople who can successfully sell new products?

Dr. Ahearne: Based on a study we conducted that looked at characteristics of over 2,500 salespeople across industries, we found several differentiators in those that achieved success. For example, they look at the big picture versus the short-term win. These salespeople manage their time wisely to create the extra time they need to sell new-to-the-market innovations. They focus on the success factors, including the right buyer, the right company and the right timing.

Another characteristic we identified is grit.  If you’re in sales, you need grit, but new product sales often stall late in the process, just when there should be a consensus to buy. It’s all about the future payoff. You have to persevere and sustain the effort.

BI WORLDWIDE: What other pitfalls do companies need to be aware of as it relates to selling new products?

Dr. Ahearne: Behavior change is difficult, for both the sales manager and salespeople. Understanding the gaps in skill sets can determine who is able to make the leap. Then identify what communication and training is required to get to the next level of new product sales. There also needs to be a focus on the entire landscape to ensure conversations are happening with the right people at the right level of the company. This may require a re-mapping of the account and opportunity as it relates to the new product or solution.

Finally, the company needs to be aligned, from senior leadership to the sales force, and have a passionate, long-term mindset for success. It’s not as simple as a handoff from R&D to an ill-prepared sales force.

BI WORLDWIDE: Thanks, Dr. Ahearne. New-product selling really requires a different mindset and a different strategy for success.

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To read Dr. Ahearne’s article titled "How to Sell New Products: Focus on learning, not performance", see the November-December 2018 issue of the Harvard Business Review or visit hbr.org.