Importance of Metrics to identify new products

The launch of a new product in the middle of a very competitive business sector has proved very difficult. To ensure success, important metrics of new products should be determined.

The launch of a new product to market is a big gamble by a manufacturer or distributor. This is because substantial investments would have to be spent in marketing and advertising this new element. This activity is very crucial as this is how potential customers or target customers are informed about the product.

Without these promotional activities, it would be very difficult or even impossible, to create demand for the product when it hits the stores and other retail outlets. Similarly, these promotional activities will also be done on a regular basis to maintain customer demand especially in the early phases of product distribution.

These days, new products are introduced both as a brand extension or an extension of the product. Brand extension, also known as brand stretching, is a well-used marketing strategy in which the company uses an existing brand to market a new product that usually belongs to another category of products. This is usually done by companies to use capital backed trademark or a long-term sustainability and equity to their advantage.

The effectiveness of brand extension, however, depends on how strongly consumers in relation to the values ​​and objectives of some brands. In 1990, it was revealed that about 81% of new products were launched through this strategy. This was seen as an effective way to reduce the financial risk due to promotional activities, and to improve consumer perceptions of the brand's core value. However, companies that use as a brand extension strategy must still be focused on launching and promoting the new product like this can potentially damage brand equity or lower the value of the brand.

A new product can also be cast as an extension of the product. This marketing strategy paves the way for the introduction of a new product that serves a different market segment, but is closely associated with an existing product. In short, is a new version of the parent product. Some companies have taken this strategy to build brand awareness and brand loyalty. Normally, consumers are likely to buy a new product, if it brings with it a brand that you trust. Among the companies that have successfully implemented this is Coca-Cola, when it launched the product of Diet Coke.

Unfortunately, brand extension or the extension product is not an action that all organizations can use. Many companies have had to start from scratch, as they come up with new and innovative products to offer to the public. For these companies, it is imperative that managers should come up with metrics for new products that can be used to evaluate how the product is doing in terms of sales and market reach. Furthermore, these parameters provide accurate information to support managers can use as a base for their future actions regarding their new product offerings .......