How do I organize a brand launch
Product planningApproach and process of product planning
Increase product success with product planning
Many products that come out on the market are a flop. When the companies realize this, the unsuccessful products are removed from the program - to start the next attempt. This “trial and error” approach is probably typical for product planning and cannot really be avoided. Nevertheless, special methods for product planning and a systematic approach can help to reduce the risk of flop and increase the chances of success.
This requires product management. One of his diverse tasks is to find, develop and launch products that are successful there. To do this, product management must identify the needs of customers, take on requirements in order to design and plan suitable products from them and, together with product development and marketing, develop them into a marketable product. After the market launch, product management must accompany and control the manufacture of the product and its marketing and plan product improvements or a product relaunch at the right time. At the end of its service life, the product will be replaced as planned by a successor product and taken off the market.
Product planning includes all work steps that are necessary to turn a business idea or product idea into a marketable product, to launch the product on the market and to establish it there for a longer period of time. Product planning is a process with several phases and diverse tasks. Product planning is mostly assigned to product management.
Product planning phases
Product planning is a core process for every company in order to develop competitive products, to introduce them to the market, to maintain, to improve, to renew or to remove them from the market. The process extends over the entire lifetime of a product. Accordingly, these phases of product planning can be distinguished:
- Product development
- Product support
- Product elimination
Since the entire lifespan of a product is considered with product planning, product planning is also spoken of in a broader sense; Product planning in the narrower sense only includes product development (phase 1). Each of the four process phases comprises numerous individual process steps and tasks. These are shown in Figure 1 below. Because this process is so important and because the tasks associated with it are so diverse, many companies have set up their own area of responsibility for it: product management.
Product planning is based on the product life cycle
The four process phases are intended to show that product planning extends to the entire product life cycle. So it does not end with the market launch. Because product management includes the planning tasks that are associated with the success of a product on the market and its marketing. The implementation of the product plan and the individual specialist planning takes place in the company's specialist departments: from market research to marketing, product development, production (manufacture), sales, logistics and service.
The Product life cycle is a concept or model that describes the ideal time course of sales or turnover of a product. It assumes that this course follows certain regularities and that the product has a finite service life. This is divided into several phases: market launch, growth, maturity, stagnation and decline. At the end of its life, the product is replaced by a successor product with which the cycle begins again.
The model of the product life cycle can be used for a single product of a company or for all comparable products that are offered on the market by several companies in competition. In this case, Market life cycle spoken.
The aim of product planning is to ensure that the life cycle of a product is as long as possible and that sales, sales, profits and returns are as high as possible over the life of the product. Since the service life is almost always limited by technological development and competition, product management must take care of product maintenance, product elimination and the planning of a successor product as part of product planning. The following Figure 2 should make this visible with the life cycle model.
Tip: How to monitor the product lifecycle
The manual chapter on the product life cycle explains methods and tools that help with the analysis of the product life cycle and with which the sales, turnover and profit of a product can be measured and tracked during its lifetime.
Strategic and operational product planning
Product planning and its process phases can include both strategic and operational tasks and decisions. At the beginning of product development, it is primarily strategic questions that have to be processed and answered. It can be:
- Is the market potential so attractive that you want to offer suitable products with your company?
- Does the planned product fit the range of services and portfolio of your company?
- Which target group should be addressed?
- How is it differentiated from the competition?
- What are the important differentiating features?
- Is the product's potential for economic success (sales, profit, return) so promising that it is worth investing in product development?
Once the strategic decision on product development and market launch has been made, product planning must primarily deal with operational issues. These are answered in the specifications for technical product development as well as in marketing planning, sales planning, production planning and other special specialist plans.
When planning for a successor product starts is again more of a strategic issue. It can be answered if the sales figures and sales figures of the product are analyzed and if the duration of the product development is known. It is also a strategic question of when the old product will ultimately be withdrawn from the market and when the successor product will enter the market. The basis for such decisions are findings from product controlling.
Tip: Methods and tools for product controlling
In the manual chapter on product controlling you will find numerous Excel templates with which you can monitor, measure and evaluate the success of a product on the market.
Process steps and tasks of product planning in detail
In the following sections of this manual, product development is first considered as a strategically and operationally decisive process phase in product planning; product planning is explained in a narrower sense. A distinction is made between strategic and operational tasks.
At this point, the tasks of product management are only mentioned in detail:
Product development and product planning in the narrower sense
- Observe market development, carry out market analysis
- Develop product ideas
- Determine product features
- Develop business models
- Create a business plan
- Evaluate and approve business idea and business plan
- Analyze competition
- Create a product concept
- Test the product concept
- Evaluate and approve the product concept
- Specify the product
- Create a prototype
- Create specification sheet
- Construct the product
- Prepare production samples and series production
- Approve product for manufacture and launch
- Set price management
- Clarify distribution and sales
- Plan logistics
- Develop marketing communication: advertising, trade fair, ...
- Qualifying employees from sales and service
- Create sales documents
- Plan production
- Approve product launch, activate website
- Expand production capacities
- Observe the product, resolve customer complaints
- Track sales, sales, profits
- Evaluate and process customer complaints
- Differentiate products, offer variants
- Develop product variants
- Align production to other variants
- Adjust prices, plan price differentiation
- find new distribution channels (multi-channel marketing)
- establish new service and logistics processes
- Automate and optimize production (learning curve)
- Develop product standards (product platforms)
- Track and increase sales, revenue and profit
- Plan product relaunch
- Approve product relaunch
- Analysis and evaluation of the key figures sales, turnover, ...
- Observe market developments
- Perform market analysis
- Create a concept for the successor product (see phase 1)
- Make a decision to eliminate the product
- Prepare logistics and production for product change
- Prepare customer communication for product change
- Adjust prices to promote product sell-offs
- Ensure service for old products (spare parts)
- Stop product sales
- Start successor product (see phase 2)
Note: Product planning tasks
The operational tasks and the diverse specialist planning during the process phases of product development, market launch and product support are explained in different places in the management manual. These are in particular:
Product planning phases
Check which phases of product planning in your company are the responsibility of product management.
- What are the tasks of product planning in your company?
- Which departments or departments are entrusted with tasks or subtasks?
- Who has overall responsibility for product planning in the narrower sense (product development) and in the broader sense (for the entire product life cycle)?
- How can the phases and tasks of product planning be represented in processes?
Use the following overview and the template to illustrate and explain your product planning and product management tasks.
For detailed process planning and task planning, use the explanations in the Process Management chapter of the manual and depict product planning as a process and with all tasks using the following template.
Determine the phase in the product life cycle
Check which phase of the product life cycle your products are in. Make this clear from the development (growth or decline) of the key figures of sales, turnover, profit and return. Use the model of the product life cycle as a guide, as shown in the following template.
Use the following Excel templates for the analysis of the key figures and for the assignment in the product life cycle:
Use it to define the goals and tasks of product planning for your company and transfer the tasks to a responsible person or to a team - for example product management. These start product planning on the strategic level. How to proceed is explained in the following section of this manual chapter.
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