95% of Product Launches Fail – How to Launch Like SpaceX

Thirty thousand new products are launched every year. Most of them fail. According to Harvard Business School professor?Clayton?Christensen, companies fail to understand how their product fits in the market. I’ve worked on dozens of product launch strategies, including some of the most successful in the location-based entertainment industry.

I’ve been watching SpaceX launches for years now. I love how they test, fail, and iterate during development to minimize the risks of an actual launch failure. Your product launch is mission-critical to your business. Many companies never recover from a failed product launch. The time, energy, and money invested in a new product can derail your business trajectory if you don’t generate a return on those investments.

Over my 35-year career, I’ve worked with dozens of VR startups and launched hundreds of products. Here are the top reasons I see products fail in the location-based entertainment market and how to avoid them.

1. Know what problem your product is solving

People buy products that solve problems. For example, entertainment solves the problem of boredom, or in some cases, it provides needed distraction from our everyday lives.

For example, is your product a painkiller or a vitamin? If you can position your product as a painkiller, people will likely buy it. If it makes your life better, you must work harder to sell it.

The more you understand the problem your product solves, the better you can define your feature set. This makes your product launch strategy more successful. But to do that, you need to know your customer.

2. Know your customer

If you don’t know your customers, how can you possibly know their problems and how to solve them? Knowing your customer is the most essential thing companies miss. One way I measure this is to look at a company’s marketing materials. How many times do they use first-person pronouns (I, we, us) vs. second-person (you, yours) or third-person (them, they)? If your marketing language is about you, your product launch is not tuned into your customers' needs.

The best tool to get in tune with your customer’s problems is an Empathy Map. (Here is a short video on how to use one). It helps put you in the shoes of your customers so you can start to shift your perspective from you to them.

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Most companies generalize too much when they examine customer problems. They’re way too broad in their market approach. They don’t understand market segments and how to break a market down into its smallest components.

Each market segment will have different problems. Knowing the problems of each type of customer in a market is the key to unlocking value and nailing your product-market fit.

3. Nail Your Product / Market Fit

If I had to identify one thing (it’s NEVER one thing, by the way) that a company could do to increase its chances of a successful product launch strategy, it would be go narrow. Companies are so excited about their products and solutions that they want everyone to have it. And that’s understandable – if you’re not excited about what you’re doing, why bother?

But if you launch your product to a broad market, you probably won’t relate to the customer at an intimate level. This means your language won’t resonate with them. You will struggle to identify how you’re solving their unique problems. Everything you do will look general, or worse, generic.

My Strategic Guide to Buying VR Attractions discusses some of the market segments for both LBE operators and solution providers. If you’re an operator, understanding your customer's mindset is critical to selecting the right product and how you might launch it. (You ARE launching these new products you buy, right?)

If you’re selling a solution, is it best suited for bowling centers, trampoline parks, or karting centers? You are not ready to launch if you don’t know the answer to that fundamental question.

Get clear on your target market, and go narrow. There are riches in the niches.

4. Know your competition

Once you know your market niche, you can narrow down and identify your competition.

I cannot tell you how often my clients don’t know who their competition is. Sometimes I hear, “We don’t have competition." Those product launches are doomed to fail.

Or they might know only one or two but not realize there are more, which means they don’t understand how crowded the market might be. Which means their positioning will inevitably be off.

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Have you “shopped” your competition, talked to their customers, and used their products? If you have not immersed yourself in the competitive marketplace, you will never be successful

I recently considered buying a pizza shop in a small surf town in New South Wales, Australia.

I sat outside the restaurant for hours, watching customers come and go to profile them. Every bar in town became an opportunity to chat with the bartenders about the reputation of the pizza shop. Every pizza shop in the city was a target to sample their products, observe and interview customers, and even talk to the owners about their businesses. I even spent a week at the backpacker’s hostel, where I learned about the town's history, the owner of the pizza shop for sale, and the story of the business.

In a week, I learned more about the pizza business in that small town than most entrepreneurs I meet know about their markets after a year of product development.

And no, I didn’t buy the pizza shop. At least not yet.

5. Understand the Distribution Landscape

Seeing how your competition is selling their products can give you a clue into the distribution landscape. But every distribution channel has nuance and quirks. Failing to understand these will lead to a failed product launch strategy.

The internet has collapsed distribution channels, disintermediated many distributors, and created entirely new ones.

There are often unwritten and sometimes unspoken rules about distributing products in specific markets. In the amusement industry, it was once forbidden for a manufacturer to discuss a game's price. It was up to the distributors to set the retail price to maximize their margin.

Just because you find a distributor doesn’t mean your product will successfully penetrate the market. Working with distributors to keep them motivated and focused on your product can be a full-time job. Too many companies abdicate the sales role to a distributor and under-invest in account management, marketing, sales teams, and lead generation.

6. Have a Product Launch Marketing Strategy and Plan

Rarely have I encountered an entrepreneurial startup with a well-rounded pre-launch strategy and plan for its product. A product launch is one of the most exciting times in a company—it’s like giving birth! I like to treat it with similar reverence and excitement.

See also? Synthesis VR Brings Free Roam VR To Forefront

Don’t just plan to show up at an industry trade show and think people will line up to buy your product. Even if you do everything listed above, you still need to capture your customers' attention. Today, attention is the most valuable currency we have. Companies like Google and Facebook have built trillion-dollar businesses monetizing our attention.

Successful product launches create so much excitement that they rise above the noise of even the most crowded markets. This is where creativity can be a powerful differentiator. How can you stand out in your niche market in a way that resonates with your target audience?

Ensure your plan leverages public relations, social media, industry events, distribution channels, thought leadership, giveaways, promotions, and online and offline media. And be willing to get a little crazy. Use creative brainstorming to generate ideas.

7. Leverage Industry Influencers

One way to gain visibility and credibility when entering a new market with a new product is to use industry influencers. Who are the people that your customers listen to? (Another reason to know your customer – see #2)

Look in the distribution channels, media, trade associations, and buying groups. Is there an influential customer that others follow? How can you get them to talk about your product?

Maybe there’s a thought leader in the space that aligns with your brand and product message? 77% of marketers say their prospective customers rely on advice from industry experts. If you're in VR I might now someone ;)

Make sure the alignment is authentic, or your audience will sniff it out and smell bullshit. The 2020 B2B Influencer Marketing Research Report shows that the most essential qualities in choosing an influencer are

1. Relevance of Audience
2. Subject Matter Expertise
3. Publishing Platforms
4. Values Alignment

If you use these seven tips in your product launch marketing plan, you will dramatically increase your odds of success. Your sales team will love you for it.

If you are launching a product in the next year and want to chat about how I might be able to help, just send me a message. I’m developing a new influencer marketing and lead generation program and would love to tell you more about it.