Sounds negative? Itâ€™s not. Long-term research shows around four out of five launches will fail, so â€˜test then killâ€™ is what an experienced marketer expects to do with the majority of his launch ideas.
Most launches, however, go differently. Most people will have an idea then treat it like a precious baby that needs nurturing. Thatâ€™s a big mistake, but I must admit I have done it myself with a magazine, various websites and at least one newsletter. But that was a while ago.
Experience, as a wise person said, â€˜is what you do with what happens to youâ€™. So here is what I have learned from what happened to me:
- The more money you have to spend, the worse the idea
- Following launch, itâ€™s very difficult to end the process when your â€˜babyâ€™ fails to thrive
- Examine the downside and take action to avoid it
- Early excitement means you overlook basic marketing rules
- Market testing will determine your direction, so apportion your pre-launch activity and budget accordingly
Why do most launches fail?
Research on the causes of launch failure is not easy to come by. There are always plenty of sides to each sad story, with recriminations and tales of drunkenness and cruelty.
But an independent list broker has good oversight, as it supplies the names for test marketing for a broad range of clients and will be the first to know if a launch project is going ahead or not.
Mike Chantry is chairman of Hilite Direct Marketing Services, which manages around 50 million pieces of direct mail a year for a wide range of clients.
Mike has found that one in five launches are immediately successful, two fail miserably and two are inconclusive.:
â€œHistory has shown me that the maybes (maybe we can get better lists, write a better prom, get some word of mouth etc. etc.) eat up management time and rarely move on to be a success – after 2 years most have made Â£37.50 but taken up huge amounts of management time that would have been better spent on more tests. This market is lucky though as test costs are cheap – you could test newsletters cheaply but a magazine takes longer and because of the expense of the launch will probably need much more market research. Looking at that market â€¦. the 1-2-2 ratio still looks about right.â€
How to avoid failure
Well, you canâ€™t and you donâ€™t want to. Failure, as in all discovery, signposts the way to success:
â€œA man of genius makes no mistakes. His errors are voluntary and are the portals of discovery.â€ James Joyce. Ulysses
But there is a way to beat those one-in-five odds, with techniques and procedures a business person can build into his business plan:
Market testing: response from tests is the main indicator of success pre-launch
Ideas bank: if you have properly researched and tested five ideas, one of them is destined to work, right? Set up and test all of them
Kill deadline: if results for an idea are poor or marginal, immediately terminate the operation and divert resources to the idea thatâ€™s working. Or waste your money. Itâ€™s up to you
Cash flow: the only true indicator of success is cash-flow. If itâ€™s working, it shows on your bank statement each week
The easy way to minimise launch risk
So launching as all about minimising the risks you canâ€™t avoid. I work with people running websites, magazines, newsletters and subscription-based companies and half of my work is about minimising risk. The other half is maximising revenue.
Those who have minimised risk and are repeatedly the most successful at launching have one thing in common: they know â€˜their ideaâ€™ works because someone else is already doing it. Me-too products are the most successful, which corresponds with one of my regular points:
â€œIf you have a successful product, launch against it yourself before someone else does.â€
People untutored in the hard realities of commercial life find it difficult to copy someone elseâ€™s idea, or even their own. They like to be creative and fulfill inspiration. But thatâ€™s a high-risk strategy and itâ€™s only for those who have plenty of money to spare. As I have shown above, there are easier ways to building a successful business.
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As publishers ourselves, we live or die by results. If a promotion doesn’t work, we lose money. If it works we record the results and use it on our own, and our clientsâ€™ websites and publications.
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