How to test a new product
I love creating new products. It is probably the most invoragting part of my day. However a good idea does not necessarily mean you will sell a lot of the product, so i have come up with some guidelines to follow. The first guidelines are what I call my basic rulebook for new products.
Rule #1. I never start out with a new product in great quantities. I start with a prototype and then create a couple locally. For example, lets say uou were going to design a new shirt that you think you can sell a lot of. It would be very tempting to buy the shirts in bulk (overseas) and then try to sell them. A better approach is to create the shirt in a small quantity such as ten and pay a higher price for the unit. Then you test the shirt for sales appeal. If you sell them all rather quickly, order 20 in the next run. Even at a quantity of 20, you most likely will not make any money kuch less the first quantity of ten. It does not matter at this point. If you go through the 20 fairly fast step up to 50. At this point you might make a buck or two per shirt. If sales demand looks good after a bigger test then consider buying in larger quantities to lower your cost and increase your margin. This works for any product whether its a shirt or a dining room table.
Rule #2. Make a test schedule. when you create a new product, you need to build a page on your site for it to live on. That page needs to have all the elements of good eccomerce design to compell someone to buy. Because the page is new, your rankings for it most likely do not exist, this is how you test it.
- Post or highlight it on your facebook page
- Put the item up on Ebay or Amazon for larger exposure, the key is for as many people to see it as possible
- Make a video with the product in it.
- Use a facebook ad to promote the product
- Use a PPC campaign to drive traffic to the page
These types of test build some hype around the new product until it naturally ranks in the search engines.
Rule #3. Decide if you will make money selling the product individually to consumers or you want to sell it by the case load to other vendors. Selling one by one is fine if you get a lot of traffic and have a good shipping system to handle individual orders. However sometimes you can make more money selling by the case load. One way to do this is to have a site that is under your business name. Nyou can showcase the product for sale to your competitors as well as selling it as a vendor on your site. You will need to create a master product cost sheet to your desktop tools so you can have prices ready. In it include your cost to create, your wholsale price per unit, uour case price wholesale and your list price. Use these numbers and list your product on sites such as global sources or Alibaba. If you just want the product to stay within your country and not export it, you can select that option.
The last item is not really a rule but a technique. I like to know who my competitors are for a certain product. I take the time to list them out and keep them for reference. When i am ready i send an email to possible sites that can carry my product with the offer of a new product. This combined with my other sales efforts completes a whole spectrum of activity. Lets review it as a whole.
- Create the product in small quantities.
- Build the page for that product on your site.
- Promote it via social media
- Promote the product page with a facebook ad and a PPC campaign
- Put the item up on ebay.
- If you have a merchant account and are approved for the appropiate category, put it on Amazon.
- Contact competitors with the opportunties to buy it by the case load.
- List the product on Global Sources and Alibaba domestically.
If you follow this blueprint for a new product it simply becomes a checklist that you repeat over and over again every time you have a new product.