Product Management

MM 2105
 The course aims to provide the student with a general overview about the
role played by the product and the product range in
the marketing strategy and operational scenarios. The students shall have
a glimpse of the process, strategies, and roadmap for new products as well.
They are also expected to create a Product Launch Plan that will guide
them in launching the product that they have created.
 Product development is the creation and launch of products to meet customer
needs. The product development process includes stages such as ideation,
marketing strategy and commercialization. It's used for new product development
(NPD) and the improvement of existing products.
.
Product development can often be as simple as taking an existing product,
modifying it slightly and selling it into your existing market. This adds value for
customers, who may well buy your new product, even though they have the
current version. Apple is a prime example of this.
.
New Product Development
New Product Development (NPD) refers to the process of delivering a new product,
service, idea, or technology to the market. The process usually follows a structured
approach that involves several stages, from ideation and concept development to
market research, product launch, and post-launch evaluation.
NPD is a crucial product development process for any company that wants to stay
competitive and grow its business. It is a complex and iterative process requiring the
involvement of several different departments, from design and engineering to
marketing and sales
Keep up with the latest technological advances and trends
Stay ahead of the competition through innovative solutions
Diversify the product offerings and create new revenue streams
Keep their employees engaged and motivated
New product development is essential for any company that wants to stay
competitive and relevant in today’s market. By constantly innovating and developing
new products, companies can remain at the forefront of their industries and continue
to grow and thrive.
There are many benefits of new product development, including the following:
Increase Revenue – Developing new products is a great way to boost a company’s
revenue. By bringing new products to market, companies can tap into new
markets and capture new customers.
Improve Brand Recognition – Launching new products can also help improve a
company’s brand recognition. When done correctly, new product launches can
generate a lot of buzz and media attention, which can help expose the company
to new audiences.
Enhance Customer Loyalty – New products can also help build customer loyalty.
When customers see that a company has high-quality products, they tend to
trust it and consequently become loyal consumers.
Create Job Opportunities – New product development can bring new job
opportunities, as companies need people to help research, develop, and market
new products. All these positions require skilled workers, which can help boost
the economy.
 1. Political Globalization
Political globalization refers to the diplomatic negotiations between nation-states. It
includes the standardization of global rules around trade, criminality, and the rule of law.

International bodies including the United Nations, European Union and World Trade
Organization are key multinational organizations designed to facilitate increasing political
globalization. This includes growing free trade and multilateral agreements on investment.
 1. Political Globalization

One of the biggest positives of political globalization is that it creates international rule of law.

It helps prevent war crimes and polices bad actors on the international stage. It can also help speed up
other forms of globalization, like economic globalization, because standardized rules around food and
trade standards makes it easier for companies to sell their goods overseas.

An argument against political globalization is that it involves countries meddling in each other’s
business. Many people think we shouldn’t interfere in the decisions of other nations. Another criticism is
that it led to the spread of the political ideology of neoliberalism that increases the gap between the rich
and the poor.
 2. Social Globalization

Social globalization refers to the sharing of ideas and information

between and through different countries. In today's world, the Internet
and social media is at the heart of this. Good examples of social
globalization could include internationally popular films, books and TV
series.

Social globalization also provides cultural integration among the world's

people, and it changes lifestyles and consumption patterns worldwide.
 2. Social Globalization

The consequences of this change can have positive and negative effects.

What happens in Afghanistan can affect what happens in the United States.
A contagion in China spreads to all corners of the world.
A nuclear weapon in North Korea can threaten lives in New Zealand.
 3. Economic Globalization

Economic globalization refers to the ways corporations do business as

multinational organizations nowadays.

Economic globalization also refers to the increasing interdependence of world

economies as a result of the growing scale of cross-border trade of commodities
and services, flow of international capital and wide and rapid spread of
technologies.

ex: import and export of goods.

 4. Technological Globalization
Technological globalization refers to the spread of technology around the world.

Examples of this include the spread of the internet, solar panel technology and medical
technologies – which can all help improve the lives of people around the world.

The spread of technologies can be interpreted as the ‘rising tide lifts all boats’
argument. Globalization means we can make the most of the best technologies from all
around the world to make everyone’s lives better and improve everyone’s economies.
 5. Financial Globalization
Financial globalization refers to the ease at which money can be spread around the
world.

One of the theoretical benefits of financial globalization, other than enhancing growth,
is allowing developing countries to better manage macroeconomic volatility, especially
by reducing consumption volatility relative to output volatility.
 6. Cultural Globalization
Cultural globalization refers to the spread and mixing of cultures around the
world.

Good examples of cultural globalization are, for instance, the trading of

commodities such as coffee or avocados. Coffee is said to be originally from
Ethiopia and consumed in the Arabid region. Nonetheless, due to commercial
trades after the 11th century, it is nowadays known as a globally consumed
commodity.
 7. Ecological Globalization
Ecological globalization refers to the idea that the world needs to be considered one interconnected
ecosystem.
This means that the world needs to work together to address ecological issues that cross the borders of
nation-states.

Examples include:
The hole in the Ozone layer, which required the world to ban CFCs.
Climate Change, which will affect the poorest nations (particularly low-lying nations in the
Pacific and South-East Asia) even though much of the damage is caused by developed nations like
the United States.

To address these issues, climate accords like the Kyoto Protocol and the Paris Climate Agreement have
been put into place, where each nation agrees to invest in lowering its carbon emissions.
 8. Geographical Globalization

Geographical globalization refers to the idea that the world is no longer seen as groups of
distinct nations as much as it once was.

It also refers to the fact that we’re now able to travel between nations with increasing
ease. You can go from the United States to Europe within a day, for example.
Furthermore, people can identify as belonging to multiple geographic regions, especially
if they hold multiple passports. Heritage and familial ownership of territory is getting
weaker and weaker.
A solid product strategy requires three essential elements. Without company reputation (A), the product is not trusted. Without market need (B), the
product will not be in demand. Without capabilities (C), the product cannot be made.
The first of the three drivers is market need. This includes better serving an existing need, uncovering
an unknown need, or creating a new need.

Better serving an existing need. Uber and Lyft are perfect examples of this. They took the taxi-
service industry and found a new, more efficient way to meet both driver and customer
requirements.
Uncovering an unknown need. A firm I worked with developed a security camera that could
view an entire room in great detail and provide instant notification of unauthorized activity. This
was not something the industry had been asking for, since no one had conceived a product like this
was possible to create.
Creating a new need. The iPhone created a platform for applications that make our lives easier,
and in doing so, created a consumer need for these applications. Entire businesses are now
launched to serve these new demands.
The second driving force is capabilities. You need to be aware of both the capabilities that are available
to you now and those that could be acquired. The minimum capabilities to consider are: technical,
manufacturing, and distribution. This is how you can ensure you achieve critical mass in each of the
following key areas:

Technical - Without this capability, your development team will not be able to create the product.
This may seem obvious, but in my experience it is often overlooked. You should identify the exact
skills needed for your project, and ensure each team member has relevant, demonstrable expertise
and success. This assurance could come from positive testimonials from previous managers or
colleagues, or records of projects and products. If your company lacks resources, these roles are
easy to outsource.
Manufacturing - If your product involves hardware and the factory you’ve selected is not capable
of building it in sufficient quantities or with the necessary quality, you are jeopardizing your
success in the market. Again, this may seem obvious to an experienced leader, but is worth
reiterating.
The second driving force is capabilities. You need to be aware of both the capabilities that are available
to you now and those that could be acquired. The minimum capabilities to consider are: technical,
manufacturing, and distribution. This is how you can ensure you achieve critical mass in each of the
following key areas:

Distribution - Without a solid distribution system or network, you will not be able to support the
demands of your customers. This is an area you must be aware of, but depending on the company,
there may be little that a single product line can do to effect significant change because
distribution agreements are often made at higher and broader levels.
Reputation impacts the success of your product in two ways: the ethical and moral behavior of the
company, and the company’s expertise in a particular area. Whereas the former is addressed at the
executive level, your company’s area of expertise guides the direction of your product strategy.

If your company has a great reputation for developing outstanding steel components for the aircraft
industry, for example, then moving into titanium parts is a turn that your customers will understand.
If, however, your company decided to start offering electronic components for domestic motorcycle
manufacturers, its reputation in the aircraft industry may not follow it into this area or bear any
weight there. The success of the sales, marketing, and distribution channels is based on their repute
with customers. Adding a new market in which they are unknown to customers is a large hurdle to
overcome.
New Product Development (NPD) is the process that combines research,
design, and engineering to turn ideas into products that meet real customer
needs. Unlike improving existing products, new product development focuses
on bringing entirely new concepts to life—from initial research and ideation to
market launch.

It refers to the complete process of bringing a new product to market. This can
apply to developing an entirely new product, adding features to an existing one
to keep it attractive and competitive, or introducing an old product to a new
market.
NDP helps you:
Stay updated with new technology and trends
Beat the competition with creative solutions
Offer more products and find new streams of revenue
Adapt to changing customer needs
Use resources more efficiently
Improve your brand's image
Grow your business and ensure sustainability
Idea generation involves brainstorming for new product ideas or ways to
improve an existing product. During product discovery, companies examine
market trends, conduct product research, and dig deep into users' wants and
needs to identify a problem and propose innovative solutions.

A SWOT Analysis is a framework for evaluating your product’s strengths,

weaknesses, opportunities, and threats. It can be a very effective way to
identify the problematic areas of your product and understand where the
greatest opportunities lie.
There are two primary sources of product development ideation.

1. Internal ideas come from different areas within the company—such as

Marketing, Customer Support, the Sales team, or the Engineering
department.
2. External ideas come from outside sources, such as studying your
competitors and, most importantly, feedback from your target audience.
The more you understand your users and the market, the better your ideas
will be. Some UX research methods you can start using include:
Competitor research: Look at what’s already out there. What’s working
for competitors? Where are they falling short? These gaps are where your
product can shine.
Customer feedback: Use moderated interviews, focus groups, UX surveys,
or product analytics. Ask your audience what they need, what frustrates
them, and what they wish existed. Their answers are often the blueprint
for your next idea.
 Journey mapping: Step into your user’s shoes. What steps do they take to
solve their problem? Where do they get stuck? Mapping their experience
helps you spot opportunities for improvement.
Concept testing: Share your ideas early on with users. Even rough
sketches or basic prototypes can reveal whether you’re on the right track
or need to pivot.

Ultimately, the goal of the idea generation stage is to come up with as many
ideas as possible while focusing on delivering value to your customers.
This second step of new product development revolves around screening all
your generated ideas and picking only the ones with the highest chance of
success. Deciding which ideas to pursue and discard depends on many factors,
including the expected benefits to your consumers, product improvements
most needed, technical feasibility, or marketing potential.

The idea screening stage is best carried out within the company. Experts from
different teams can help you check aspects such as the technical requirements,
resources needed, and marketability of your idea.
“Logic trees are a valuable tool to try and make sure I have a structured
understanding of the space I'm working in and making good decisions when
choosing problem spaces to work on.” - Ben Zacharias
All ideas passing the screening stage are developed into concepts. A product
concept is a detailed description or blueprint of your idea. It should indicate the
target market for your product, the features and benefits of your solution that may
appeal to your customers, and the proposed price for the product. A concept should
also contain the estimated cost of designing, developing, and launching the
product.

Concept testing is a great way to validate product ideas with users before investing
time and resources into building them.
Concepts are also often used for market validation. Before committing to
developing a new product, share your concept with your prospective buyers
to collect insights and gauge how viable the product idea would be in the
target market.

Developing alternative product concepts will help you determine how

attractive each concept is to customers and select the one with the highest
value.
Now that you’ve selected the concept, it’s time to put together an initial marketing strategy
to introduce the product to the market and analyze the value of your solution from a
business perspective.

The marketing strategy serves to guide the positioning, pricing, and promotion of your
new product. Once the marketing strategy is planned, product management can
evaluate the business attractiveness of the product idea.
The business analysis comprises a review of the sales forecasts, expected costs, and
profit projections. If they satisfy the company’s objectives, the product can move to the
product development stage.
The product development stage consists of developing the product concept into a finished,
marketable product. Your product development process and the stages you’ll go through
will depend on your company’s preference for development, whether it’s agile product
development, waterfall, or another viable alternative.

This stage usually involves creating the prototype and testing it with users to see how they
interact with it and collect feedback. Prototype testing allows product teams to validate
design decisions and uncover any flaws or usability issues before handing the designs to the
development team.
This stage usually involves creating different kinds of prototype and conducting prototype
testing with users to see how they interact with it:
Low-fidelity wireframes: Validate initial concepts and uncover whether your idea
resonates with users and aligns with their expectations
Mid-fidelity designs: Incorporating feedback, refine layouts, and ensure your design
direction remains on track
High-fidelity prototypes: Review the user experience and check for any usability issues
before handing designs to the development team
At this stage, it's essential to stay in touch with customers and gather research data to
understand what works and resonates with the target audience and what doesn’t. Results
can also be used to write the copy and the messaging around the launch.

Test marketing involves releasing the finished product to a sample market to evaluate its
performance under the predetermined marketing strategy.
There are two testing methods you can employ:
Alpha testing is software testing used to identify bugs before releasing the product to
the public
Beta testing is an opportunity for actual users to use the product and give their feedback
about it
The goal of the test marketing stage is to validate the entire concept behind the new product
and get ready to launch the product.
At this point, you’re ready to introduce your new product to the market. Ensure your
Product, Marketing, Sales, and Customer Support teams are in place to guarantee a
successful launch and monitor its performance.

Remember, product launch is a critical part of the broader commercialization stage.

While the product launch focuses on the initial introduction of the product to the
market, commercialization includes the entire timeline from product development to
market saturation.
To better understand how to prepare a go-to-market strategy, there are some essential
elements to consider:
Customers: Understand who will be making the final purchasing decisions and why
they will be purchasing your product. Create user personas and identify their roles,
objectives, and pain points.
Value proposition: Identify what makes you different from the competition and why
people should choose to buy your product
Messaging: Determine how you will communicate your product’s value to potential
customers
Channels: Pick the right marketing channels to promote your products, such as
email marketing, social media, SEO, and more
You will need to constantly track and measure the success of your product launch and
make adjustments if it doesn't achieve the desired goals.
“A successful product launch is about setting your key results as early as possible,
understanding how to track them, and then figuring out how to use the learnings to make
changes or adapt.” -- Ian Booth, Product Team Lead at EduMe
A product concept, also known as a concept statement, is a description or
vision of a product or service, typically developed at an early stage of the
product lifecycle.

Product concepts are built long before any kind of design or engineering
work — taking into account market analysis, customer experience,
product features, product-market fit, cost and more to help bring the
concepts to life.

The last part of the product concept is the product concept statement. It
articulates the product strategy, vision, purpose, and how it will provide
value to customers and the business.
Product concept statements typically cover these elements:
The product or service name
Target users or segment
How target users will use the product or service
What problems or pain points the product or service solves
The business goals the product or service supports
The concept’s unique selling points
The overall vision and strategy for the user experience
Product concepts provide a starting point for discussion and continued improvement,
so sharing them as early as possible is both beneficial and essential.

Product concepts also serve as a check-in mechanism — by returning to the initial

product concept statement, teams can determine whether they’re still on track and
building something that satisfies the criteria outlined in the document.
Convenience products – A convenience product saves customers time and effort.
Convenience products are goods that customers usually purchase frequently, immediately
and with minimal effort. For example, soap, toilet paper, and batteries — are all examples
of convenience products.
Specialised products – Specialised products are products that consumers actively seek to
purchase because of unique characteristics or loyalty to a specific brand. These consumers
won’t normally accept substitute products. For example, high-end fashion clothing, luxury
vehicles, and famous paintings.
Brand products – The sentiment behind branded products is simple: the more positive the
brand connotation, the more likely it is that a consumer will buy something from it. For
those with brand recognition, the chances of a successful product concept — not just from a
design and market opportunity — are much higher as they’ve established their position.
Use roadmaps, backlogs, recurring meetings, and syncs, but keep communicating with
your team.
At every stage of the product development process, there is one critical driving factor: the
customer. Identify what your customers need, which features would help them the most,
and how to make your product appealing to them.

Collecting product feedback and insights helps you ensure that the end product meets
their expectations, solves their problems, and fulfills their needs.

When it comes to making and validating decisions, Ian points out that it’s always best to
have qualitative data alongside quantitative information. You can use product surveys,
customer interviews and market research, but make sure you back up those insights with
behavioral data on how users use the product.
Each team is different. So, it’s essential to create a supportive and flexible environment
that allows you to identify which product development process works best for you and
your organization.
Throughout the new product development process, we are doing evaluations, and there
are evaluation techniques appropriate to each of the phases in the basic new product
process.

New products fail because

-There was no basic need for the item as seen by intended users
-The new product did not meet its need considering all disadvantages
-The new product idea was not properly communicated (marketed) to the intended user
The purpose of the evaluation process is to guide us to profitable new products. Each
step has a key task.
1. Opportunity Identification/Selection
2. Concept Generation
3. Concept/Project Evaluation
4. Development
5. Launch
What is Concept Testing?
Concept testing is a research method that involves asking customers questions about
your concepts and ideas for a product or service before actually launching it. Thus, you
can gauge your customers’ acceptance and their willingness to buy and therefore make
critical decisions before the launch.

Concept testing helps businesses purify their ideas, prioritize features, or decide
whether to proceed with a concept. It is crucial to reduce the risk of failure by
ensuring that a product meets market expectations before significant resources are
invested.
Concept testing provides valuable insights that help ensure a successful product launch. You can gather in-depth
feedback on various aspects of your idea, such as:

Specific features
Look and feel
Pricing
Other key elements

Testing helps validate every detail of the product testing before its launch.
Organizations and businesses use surveys to carry out concept testing making it a simple proposition for brands of all
sizes to utilize. In the following section, we will discuss the different methods of concept testing.
Concept testing provides valuable insights that help ensure a successful product launch. You can gather in-depth
feedback on various aspects of your idea, such as:

Specific features
Look and feel
Pricing
Other key elements

Testing helps validate every detail of the product testing before its launch.
Organizations and businesses use surveys to carry out concept testing making it a simple proposition for brands of all
sizes to utilize. In the following section, we will discuss the different methods of concept testing.
In comparison testing, two or more concepts are presented to the respondents. The respondents
compare these concepts by using rating or ranking questions or merely asking to select the best
concept displayed.

Comparison tests give clear and easily understandable results. It’s easy to determine which concept is
the winner. However, the results lack context. There is no way to tell why the respondents choose one
concept over others. It is essential to understand these details before successfully launching a product.
The target audience is broken down into multiple groups in a monadic
test. Each group gets shown only one concept. These tests focus on
analyzing a single concept in-depth. A monadic test survey is usually
short and highly targeted.
Like the monadic test, in sequential monadic tests, the target audience is split into multiple groups.
However, instead of showing one concept in isolation, each group is presented with all the concepts.
The order of the concepts is randomized to avoid research bias. The respondents are asked the same set
of follow-up questions for each concept to get further insights.

Since each group of respondents sees all concepts, the target audience size required to perform a
sequential monadic test is relatively small. Multiple concepts can be tested in a single round.

Thus sequential monadic tests are more cost-effective and easy to field. This concept testing method
makes it ideal for research with budget constraints or when only a small target audience is available.
A protomonadic test includes a sequential monadic test followed by a comparison test. Here,
respondents first evaluate multiple concepts and then ask to choose the concept they prefer.
This design is useful to validate the results from the sequential monadic test. Researchers can verify if
the concept selected in the comparison test is compatible with the insights collected about each idea.
 1.
Tesla launched its Model 3 in 2017 and made headlines worldwide. It used a unique launch strategy by
using concept testing to gain approval from customers and raise capital.
The participants were presented with the Model 3 concept. Once they were familiar with the car’s
different features and benefits, they could put down a deposit. This strategy was a huge success, and
Tesla raised $400 million.
Thus, using concept testing, It gathered invaluable customer feedback and financial resources to go
ahead with their launch.
Lego always faced difficulties selling its products to the female demographic. Despite their best efforts,
only 9% of their toys were purchased by young girls. Lego decided to invest heavily in conducting
concept testing and market research over an extended period to change this. This research’s primary
objective was to understand young girls’ play habits.
This research made them realize that girls preferred to build entire environments rather than stand-
alone structures. Girls also focussed more on interior layouts and structure details.
Using these insights, Lego decided to design a whole new line of products catered to the female
demographic – Lego Friends. This series launched in 2012 and tripled the value of construction toys for
girls from $300 million to $900 million in 2014.
 Differentiate between substantial innovation and minor update.
Concept testing should be performed for any changes being brought forward to the market, from slight adjustments to
pricing/features to launches of entirely new products. Identifying the concept’s new elements versus its existing elements
enables businesses to better focus their research on its defining features and choose appropriate testing methods. This provides
more clarity into which concepts may be riskier and require more development than others.

Get involved in a continuous testing process.

Iteration is key for concept testing. Businesses should avoid falling into the ‘set and forget’ trap and invest in an
ongoing concept development process. With each product change made in response to consumer feedback, the
latest concept must be tested with the audience. This ensures accurate insights and helps remain up-to-date with
the target audience’s wants and needs.
 Compare test results to the previous findings.
Using data from past concept test surveys helps businesses to develop concept standards for important elements such as
audience approval. Despite potentially lacking timeliness, previous concept evaluation data is still highly relevant and
insightful. It holds information which can apply to new concepts, such as branding, pricing, and baseline features. Businesses
can also use this information to pinpoint which testing methods work most effectively and which ones need improvement.

Keep survey design consistent.

Surveys should be straightforward and easy to complete to ensure accurate responses. Using Likert scales creates a consistent
structure to your concept test survey which makes it easier to analyse results. Likert scales ask respondents to rank their
opinions on a five- or seven-point scale ranging from “strongly agree” to “strongly disagree.” Most respondents are familiar
with this format, which will ensure surveys are user-friendly.
 Choose an appropriate format to present your concepts.
Product concepts need to be clearly conveyed to consumers or they may not properly understand an
idea, and consequently provide misinformed responses. Selecting the right medium for communicating the
concept is the best way to ensure the audience interprets it correctly. For example, an image may suffice
for a new packaging format, whereas a video would be required to demonstrate new functionality.
1. Set a goal
This is the most important step – without a clear idea of what you are hoping to find out or why, you cannot seek or receive the
right answers. Before conducting concept test surveys, a business should consider the type of responses they are seeking, the
form of data they want, and how they intend to use it. Having a solid goal provides a reference point for all stages of product
development, not just concept testing, and ensures each task remains focused on the same purpose.
2. Brainstorm
Brainstorming involves gathering all relevant stakeholders, including customers and production teams, to draft initial ideas.
Ideally, these sessions should produce many varied options, from which the multiple concepts will later emerge.
3. Set rules
In order to test the concept effectively, the parameters need to be clearly defined such as the number of concepts allowed,testing
methods and limitations on variations of the design. The time allocated per each iteration of concept testing. How many rounds of
testing should be done. And who is responsible to sign off the test outcomes.
4. Design surveys
The design of your concept test surveys will determine the quality of your respondents’ answers. You need to select visuals/text
that clearly describe your product concept and ask questions that effectively gauge respondents’ reaction to it. By this time, you
should be testing clearly defined concepts.

5. Analyse results
After each round of concept evaluation, you need to decide if the results give you enough confidence to move a single concept
further. If there are elements which need tweaking or you still have additional questions regarding consumer perceptions, you will
need to continue the process and create another survey.
Too often managers lack a good selection procedure and do one of two things:

-Guess (and probably select the wrong project)

-Approve everything (and consequently underfund every project
Flow of new product concepts through screening and protocol
Protocols help making decision on which concepts go on to development; the full screen is part of this
elimination process
It is a screen where all the ideas either bounce off of or pass through to the next stage.
Where the protocols are located and with these protocols certain concepts are picked that
suit the company’s vision and strategy and these are sent to be developed
The term “full” here means that we now have as much information as we’re going to get before undertaking technical
work on the product. The full screen often involves the use of a scoring model, which is an arrangement of checklist
factors with weights (importance) on them.
The full screen accomplished three objectives:
[Link] helps the firm decide whether it should go forward with concept or quit. The concept will become a new
product development project and will require a serious increase in commitment of financial and human resources.
[Link] full screen helps manage the process by sorting the concepts and identifying the best ones.
The best of the concepts can be rank ordered or prioritized such that we have some options on standby
when an ongoing project stalls or is canceled,
Further, a record is kept of rejected concepts to prevent reinventing the wheel when a similar concept
comes up again later.
3. the full screen encourages cross-functional communication
The term “full” here means that we now have as much information as we’re going to get before undertaking technical
work on the product. The full screen often involves the use of a scoring model, which is an arrangement of checklist
factors with weights (importance) on them.
The full screen accomplished three objectives:
[Link] helps the firm decide whether it should go forward with concept or quit. The concept will become a new
product development project and will require a serious increase in commitment of financial and human resources.
[Link] full screen helps manage the process by sorting the concepts and identifying the best ones.
The best of the concepts can be rank ordered or prioritized such that we have some options on standby
when an ongoing project stalls or is canceled,
Further, a record is kept of rejected concepts to prevent reinventing the wheel when a similar concept
comes up again later.
3. the full screen encourages cross-functional communication
Sales Forecasting and Financial
Analysis
The ATAR forecast model is a marketing model that stands for Awareness, Trial, Availability, and Repeat. It is a
framework used to forecast and analyze the potential success of a new product or service in the market.
Here’s a breakdown of each component:
1. Awareness: This refers to the level of consumer knowledge or recognition of a particular product or brand.
It measures the extent to which the target market is aware of the product’s existence and its features.
2. Trial: Trial represents the initial purchase or usage of the product by consumers. It focuses on encouraging
potential customers to try the product for the first time, often through promotional activities, free samples, or
trial offers.
3. Availability: Availability refers to the accessibility and distribution of the product. It considers factors such
as the product’s physical availability in stores or online, the ease of purchasing or obtaining it, and the overall
convenience for customers.
4. Repeat: Repeat refers to the likelihood of customers repurchasing the product or becoming loyal to the
brand. It measures the rate at which customers continue to buy the product after the initial trial, indicating
their satisfaction and loyalty.
These four main components of the ATAR model are presented in a percentage (or decimal) form.

For example:
awareness of 60% of the new product, potentially trialed by 20% of consumers, 75% availability within stores,
with 50% of consumers (trialing product at least once) and then continuing to rebuy/repurchase the product on
a regular or occasional basis.

Using the example percentages above, if we started with a target market size of 10 million consumers, then
ongoing customer base (in consumers, not sales) would be calculated as:
10 million consumers (in the target market = buying units)
X 60% awareness
X 20% trial
X 75% availability
X 50% repeat/rebuy
By multiply each of these ATAR components, this would work out to be:

Start with 10,000,000 consumers

6 million consumers aware of the new product(10m X 60%)
1.2 million consumers willing to trial the products (6m X 20%)
900,000 consumers finding the product “available” in a store and trailing the product (1.2 m X 75%)
And finally 450,000 ongoing customers (from light to heavy users) (900,000 X 50%)

If we multiply the four ATAR components above, we would get 60% X 20% X 75% 50% = 4.5%.

This tells us that we expect to have 4.5% of the total target market (number of buying units) becoming our
ongoing customer base, as shown in the above example (where 4.5% of the 10 million consumers = 450,000
customers).
While these four letters (ATAR) these are the core assumptions and inputs into the sales
forecasting model, the
ATAR model requires further inputs to calculate the sales and profit projections.
The additional information required is:
The number of consumers/buying units in the marketplace
The loyalty rate of your customer base over time
The average purchase quality per buying unit/consumer
The average price and cost per unit – to determine margin per unit
Expected promotional spend/budget
Likely product cannibalization rate, if applicable
1) Lack of Expertise
With only existing knowledge, diving headfirst into the world of numbers-heavy forecasting can be
tempting. However, suppose the manager needs to figure out how to forecast accurately; in that case,
it's best to find someone with experience who can guide you through the process.

Good training will equip managers with the necessary skills and help them avoid common pitfalls.
Allowing managers to do their forecasting without assistance is like letting drivers complete their
auto maintenance—they may figure out enough to get by the process. Nonetheless, they will never be
able to deal with every possible situation that may arise. A good trainer can assist managers in
thinking critically about their forecasts to prepare them for every possible scenario.
2) Unwillingness to Change
There are numerous methods for forecasting sales results. Others may use propensity modeling or
extrapolated longitudinal trends, while some rely on the traditional sales funnel stages. Leaders must
admit when their methods are no longer effective (or perhaps have never worked). In addition, many
CSOs recognize that forecast accuracy issues are a symptom of an out-of-date sales process.

Sales processes have traditionally been designed sequentially. However, most B2B purchasing
journeys are nonlinear. Sales processes may need to be redesigned before they can correct forecasts.
Then, sellers must be trained to manage opportunities by tracking progress through the buying
journey with customer verifiers.
3) Poor Sales Process Execution
Poor data quality is expected when sales management fails to define or enforce strict stage definitions
and milestones for sales cycles across marketing, sales, and customer success. Unfortunately, this is a
common occurrence in most businesses. The lack of a formal process is the most significant
impediment to developing a sales forecast. Many companies have a sales forecasting process, but it
isn't being used as effectively as it could be. They may lack a documented method or employ one that
is incompatible with their overall business goals and objectives.
5) Technology Constraints
Sales teams make significant investments in technology. Sales organizations routinely use more than
ten sales technology tools and intend to add four more in the coming year. The difficulty in sales
technology and forecasting stems from a lack of planning and integration.

According to Kornferry’s data, nearly 30% of survey respondents said their sales technology stack was
tightly integrated with all its applications, including CRM. Approximately the same percentage
believed that their sales tech stack seamlessly supported a seller's daily routine.
6) Low-quality Data
Forecasting is based on sales data, which is only reliable when it is complete and accurate. Poor data is
primarily the result of inconsistent or poor sales process execution. Sellers frequently fail to enter data
into customer relationship management (CRM) or forecasting systems. When they do, many sellers
rely too heavily on gut feelings about an opportunity rather than objective data. While some sellers
are overconfident, others are overly cautious. Individuals and managers alike tend to sandbag
numbers.
7) Decisions based on Instincts
Relying on gut feelings instead of data-driven insights can lead to inaccurate sales
forecasts. Without solid data, forecasting becomes a guessing game, making it harder to
stay on track and make informed decisions. A thorough analysis of performance metrics,
market trends, and customer behavior provides the clarity needed to understand what’s
driving success—or causing setbacks. By leveraging data, businesses can move beyond
instinct and create more accurate, reliable forecasts that guide smarter decision-making.
7) Decisions based on Instincts
Relying on gut feelings instead of data-driven insights can lead to inaccurate sales
forecasts. Without solid data, forecasting becomes a guessing game, making it harder to
stay on track and make informed decisions. A thorough analysis of performance metrics,
market trends, and customer behavior provides the clarity needed to understand what’s
driving success—or causing setbacks. By leveraging data, businesses can move beyond
instinct and create more accurate, reliable forecasts that guide smarter decision-making.
8) Delay in Sales Forecasting
67% of organizations do not have a formalized forecasting approach. Businesses
frequently begin forecasting at the start of the year or even at the start of a fiscal quarter.
By then, it's too late to get an accurate picture of what's happening in the business. The
best time to start forecasting sales is as soon as possible—ideally, six months before you
need the information.
Product protocol also called product definition, product requirements or product
deliverables is critical to innovation. A product protocol is necessary after you have
chosen a new product concept, completed concept testing and done some
preliminary sales forecasting of what numbers you expect to sell and at what
margins.