Canadians love new and innovative products. In fact a 2013 survey by Product of the Year Canada found 8 in 10 of us factor products being innovative into our buying decisions. Yet product innovation – whether it is improving on existing products or disrupting the market with entirely new ones – can be very difficult, and the road to success is littered with failures. A lot of failures: Some estimate that as many as two-thirds of new products will fail within two years. We talked to some of Canada’s leading experts to get their insights on how manufacturers can maximize their chances of successfully introducing new products to the Canadian market.
1. Know What Support is Out There
There are plenty of resources available that Canadian companies can tap into for support when developing or launching new products. This is especially true for SMEs, says Kevin Davis, Canadian Manufacturers and Exporters‘ Director of Memberships and Strategic Partnerships. “Don’t think you are alone in this – look for the resources that are available to you,” he advises.
“If you’ve developed a new product that meets a need then there is government support available, for example, you can claim for the cost of work hours.” Government support is often available on local, provincial and federal levels, while the Canadian Trade Commissioner can provide market intelligence and universities or colleges can be tapped into for in-kind academic support. “There is a lot out there. Industry organizations such as the CME are aggregators of information and can be great places to start finding out what support – financial and non-financial – is available to you,” Mr. Davis says
2. Ensure People Can Afford What You’re Selling
The best new product in the world is doomed to failure if consumers cannot afford it. Modern consumer financing offers simple and efficient ways to ensure people can afford your product without impacting your margins, says Crelogix Power Products Managing Director Serge Maheux. Something very important considering the high costs of R&D. “Successful sellers in any market understand the success of their product isn’t just dependent on the tangible product they are selling,” he says. “It’s dependent on your ability to market and sell to consumers.”
There are countless historical examples of how understanding this has helped companies successfully introduce innovations, from automobile giant GM using financing to make cars more affordable to multinational sewing machine success Singer using financing to move more product. “Offering financing options such as monthly payment plans can help more people afford your innovations, and could ultimately be the difference between a successful and an unsuccessful new product launch,” Mr. Maheux says.
3. Know Your Limits, Create a Plan and Stay Focused on What Matters
Having a plan is not enough – businesses need to ensure they stay focused and measure their results, says KPMG LLP National Industry Leader for Industrial Markets Laurent Giguère. Mr. Giguère surveys 150 Canadian manufacturers typical of the market every year for the Canadian Manufacturing Outlook, and says the latest survey reveals that 54% of respondents do not believe their processes and systems are effective in determining profitability. Something that concerns him. “Companies need to be focusing on profitability,” Giguère said. “If there’s a message that needs to be shared when it comes to new product launches, it needs to be about knowing your limits, staying focused and being able to measure your performance.”
Innovation is crucial for Canada’s future in an increasingly competitive international market, Giguère argues. But it needs to be introduced right. “Companies must be able to stick to their plans as they move along, or recognize they need adjusting,” he says. “They need to be focusing on profitability and tied to that is risk management. Set your limits and make sure you know how to measure your performance as you go – this is key to successfully launching a new product.”
In a nutshell
It is vital to remember that the success of a new product depends as much on the groundwork you do as the product itself. Three simple ways to help ensure your innovation is successful in the Canadian market are to plan thoroughly and measure your results, incorporate affordability and be aware of the support that is available. Do this and you can maximize the chances of your innovation’s successful entry into the Canadian market.