Tag: R&D

8 signs your product is dying (and what to do about it)

Every product that launches into the market goes through four stages of the product lifecycle: introduction, growth, maturity and decline.

When the product reaches the decline stage, profitability will start to fall until it is no longer commercially viable to continue production, and it will most likely be discontinued.

In some cases, the original product will be replaced, either by a newer version with updated features or design style, or perhaps by a brand-new product. Car manufacturers, for example, update models every few years. The name continues but the older models are phased out, replaced by newer versions with updated technology and more modern designs. Eventually the model may be discontinued to be replaced by a brand new model e.g. Ford Escort – Ford Focus.

While the span of each product’s lifecycle is unique, (some tend to spend more time in the maturity stage), they will all eventually reach the decline stage. There may still be some core loyal customers, keeping the product afloat, but overall demand will continue to fall.

Think back to products that used to be popular; cassette players, typewriters, video recorders, even the Nokia 3310 (remember those? 😊). They will either have a very small production run now or will have ceased production completely. Eventually only second-hand products will be available, perhaps cherished by enthusiasts and collectors.

WHY DO PRODUCTS DECLINE?

 Decline is a natural part of the product lifecycle. Typically, when a new product is launched, it will be expensive to manufacture and therefore expensive to buy. As demand grows and production costs fall, competitors will start to sell rival products and the marketplace will fill up. The product will experience a period of growth followed by maturity.

There are several factors that may cause a product to decline, such as saturation of the market or the introduction of more innovative products, which will lead to a fall in popularity.

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Some companies will try to keep a dying product alive for as long as possible – clearance sales, special deals etc, but this is simply delaying the inevitable as the product will continue to lose market share until it doesn’t make commercial sense to continue production.

HOW TO SPOT IF YOUR PRODUCT IS DYING: 8 SIGNS

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1. Customer interest decreases

The interest in the product will fall – less chat on social media, fewer calls and email enquiries.

2. Competitors are launching ‘me too’ products

Competitor products will be launched that imitate the original. Production may be moved to the Far East where it is cheaper to manufacture.

3. Market share reduces

Competitors with newer products are stealing market share from you.

4. New technology launched, product is outdated / unsupported

The product will be unsupported by new software which will affect performance and customer satisfaction.

5. Product is only bought by loyal or existing customers

Demand from new customers will fall, the product will only be bought by existing customers.

6. Necessity to drop price to garner any sales

The only time sales are made is when the price is reduced, which will eat into any margin made on the product.

7. Decrease in marketing spend

Advertising spend will be channelled towards other products that provide a better return on investment (ROI).

8. Production / supply chain costs increase, while sales do not

As demand falls for certain components, it may be more difficult and expensive to source them. If you notice production costs are going up, yet sales are going down, it’s because the product is declining.  

WHAT TO DO IF YOUR PRODUCT IS DYING

Before a product reaches the decline stage of the lifecycle, the next generation product should already be in development. This is especially important if you operate in an industry where new technology is regularly released. Ideally, you should be working to a rolling three or five-year roadmap, with all future product launches mapped out.

Working on the next product development will ensure that your business and its products are always in demand, and keeping up with competitors to protect (and increase) your market share.

However, if your next generation product is delayed, there are some ways you can exploit the existing, dying product to generate some more sales – think of it like using a defibrillator on your product to restart its heartbeat.

Sony Walkman obsolete product

Photo credit: Unsplash

1. Reach new customers

You can try to revive the existing product by attempting to reach new customers, for example by using different marketing channels or platforms. This may require some advertising spend, but online advertising methods can be excellent value for money, and the payoff in extra sales may make this a worthwhile exercise.

2. Rebrand or redesign

You can redesign the existing product and launch it with new and improved features. Rather than developing a new product, a redesign of the existing model could be a quick cost-effective solution to boost sales for a short while. Rebranding the product may also boost demand temporarily. But ultimately, unless significant updates are made, you are delaying the inevitable.

3. New product development

Ultimately, the only option will be to develop a new product to replace the dying model. This is the most expensive solution, but it will have the most long-term benefits, and is essential if your business is to continue growing market share.

When you start developing a new product, it’s essential to conduct market research amongst your target audience. Look at reviews and feedback of the declining product. What do your customers love and hate about it. Invite some of your loyal customers to offer honest feedback via surveys and focus groups. And invite people who are not your customers, too. It’s just as important to hear what they have to say – how can you turn them into a customer?

Once the research is conducted, you will have an idea of the essential and nice-to-have features for your product. You will also know the price point that customers are willing to pay. You can then start developing a product that meets the needs of the target customer at the price they are willing to pay. During this process you may discover that some of the nice-to-have features are not commercially viable and will have to be dropped for this particular product.

We work with our clients to ensure thorough market analysis is conducted for all new product development – which also includes researching and comparing competitor products.

If you’re ready to start your next product development, get in touch with our team today.

Thinking about hiring an agency? 8 reasons why you should

Whether you’re a small business owner, product inventor or maybe even an R&D or marketing manager within a larger organisation, at some point you’ll probably be faced with the need to hire an external agency or consultant to assist with a project.

You may be reluctant to hire a consultancy. There may be some thoughts going through your mind:

  • Agencies are expensive
  • The consultant will take over the project and change its direction
  • I had a bad experience with ‘ABC agency’ and it’s put me off using anyone else

Let’s face it, a lot of us have had experiences in the past with the ‘wrong’ agency.

But the truth is, when you find the RIGHT agency; they naturally become an extension of your organisation. They increase your workforce, skills and experience, and can even reduce the cost of your project.

So, if you’re asking yourself: do I really need to hire external resource? Take a look at some of the benefits of using the right agency:

1.) EXTRA RESOURCE WHEN YOUR INTERNAL TEAM IS STRETCHED

This is perhaps the most obvious benefit to hiring an outside agency. Quite often, R&D and marketing teams are stretched working on current projects. Add in internal meetings, calls, emails, other office distractions (including colleagues!) and it’s no surprise that a lot of teams are often at breaking point. When you have an important project, a new product development or an important product marketing launch, hiring an outside agency with the capacity to focus on the job in hand without distraction can release the pressure on your internal team. The outcome is a speedier project with better results.

2.) NOT LIMITED BY COMPANY CULTURE OR PAST PROJECTS

Innovation is limited by our past experiences. Your internal team is highly skilled but they may be influenced by previous projects, or they may be reluctant to push boundaries in fear of disturbing the status quo. An outside consultant can expand horizons; they aren’t bound by your company culture. This may mean some of their ideas are a bit “out there” but it’s good to break the rules sometimes.

3.) THEY CAN BRING FRESH IDEAS TO THE TABLE

Building on from the previous point, a good consultancy will bring new ideas to your company, after all, what are you paying them for? They may improve the design of the product or marketing campaign by suggesting ideas otherwise not thought of by your internal team. They’ll have had different experiences to your team, perhaps in different industries, which will bring new ways of thinking to the project.

4.) THEY WORK TO A DEFINED PROCESS

A good product design or marketing consultant will have an efficient working process with specific stages (take a look at our design and marketing processes). This will help to keep the project running to date, and may even help to reduce overall timescales.

5.) THEY HAVE ACCESS TO TOOLS AND EQUIPMENT

Depending on the project, you may want the agency staff to use your equipment and software, but a decent agency will have their own professional equipment setup. This means that they can work either remotely or in your office, depending on your needs. A good consultancy will have a full suite of professional equipment that you may not have, such as 3D printers, enabling you to have prototypes made quickly for a reduced cost.

6.) THEY HAVE VALUABLE CONNECTIONS

Agencies work on lots of different projects and in doing so build a wide network of contacts. Their connections can be valuable to your project; they may help to reduce costs of materials, tooling, or perhaps advertising costs. They may have contacts at various publications to help with PR. As well saving money, these connections may also help to increase the scope on product designs.

7.) SUPPORT SERVICES ALL UNDER ONE ROOF

A holistic agency (like us!) will look at your whole product portfolio, design and marketing needs. They can support you along the whole product lifecycle – from concept to market launch and beyond – so that everything you need is all under one roof from one agency. This can be more effective (and cheaper!) than using multiple agencies for different areas of support.

8.) THEY CAN ACTUALLY REDUCE PROJECT COSTS

Hiring an agency can reduce timescales, open up connections to a wider network of suppliers and increase scope of design. All of this can actually help to reduce overall costs – result!

We’d love to hear your experiences of hiring agencies – do you have mostly positive or negative experiences?

What our clients say.

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    I approached Cornelius Creative to help with my business branding, which had got a bit stale. They were able to look at my business as a whole and refresh my brand to make it more appealing to my customers. They made huge improvements to my logo and visuals as well as my messaging to make it more appealing. My brand is more recognisable now and I couldn't be happier with the result. I'd definitely work with Cornelius Creative again.
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