How to Avoid These 4 Common Commercialisation Pitfalls
June 7, 2017
Taking a new product or service to market can be daunting. Especially in the emerging technology sector, where innovations typically have high development and launch costs, getting commercialisation right the first time around is crucial.
Here are four common mistakes that businesses make during commercialisation, and how you can avoid them:
1. Failing to prepare
Successful commercialisation depends on thorough preparation and planning. Too many companies wait until their product or service is fully-developed and “market-ready” before thinking about commercialisation. Taking a commercial focus from the start of your project will enable you to think about your target customer, the route to market, and possible pricing structures throughout the development process. This will leave you better prepared by the time the development and testing process is complete. You should also begin seeking investment and funding opportunities from early on. Adopting a commercially-driven approach from the outset can ensure that you will not only have developed an outstanding product or service, but also one that can succeed in the commercial marketplace.
2. Running out of money
Launching a new product or service is expensive. This is even truer in the emerging technology sector, where innovating new products and services can prove extremely costly. These expenses, coupled with development, production, distribution and marketing costs mean that there is a lot of financial information to take into account. During commercialisation, it is easy to lose track of what you are spending if you are not properly prepared. If you lack the expertise to manage project and financial resources yourself, contract a project manager or project accountant to assist you. Set a budget and stick to it. Ensure that your product or service will make an adequate return, and forecast financial projections for the next 5 to 10 years prior to launch.
If a lack of financial resources is your problem, then seek investment early. Pitch to as many relevant investors as you can, and explore additional funding opportunities. Whether you are eligible to claim a government grant or loan, or if you choose to enter an industry-related funding competition, there are many means to boost your resources. Don’t forget to factor in any credit and loans into your financial forecasts.
3. Organisational problems
Structural business flaws and managerial errors have been the downfall of many a tech start-up. If your business suffers from a flawed organisation structure or bad management, then not only is your business a risky investment for potential investors, but could also hinder the success of commercialisation. Commercialisation in itself will not resolve any underlying company issues. Be it lack of revenue, mismanagement of people or resources, or something else, it is imperative to resolve any dysfunction in your organisation before going to launch. Commercialisation can put extra pressure on existing fault lines in your business, and you should give your product or service the best chance you can to succeed. Iron out internal problems to avoid jeopardising the commercialisation process.
4. Bad marketing
Marketing is all about reaching a targeted market with the right message in order to achieve tangible business results. Get it wrong, and your target market won’t have a clue who you are or what your product is. Get it right, and your product sells and you make revenue. In order to achieve the latter, it is crucial to take a strategic approach. Put together a comprehensive marketing strategy, and be clear about what you want to achieve through your marketing. Next, explore how these goals can be met, and how much you are able and willing to spend. For smaller companies, it might be well-worth outsourcing your marketing to an agency. Whatever you decide, be clear about your objectives, and ensure that what you spend delivers a return on investment.
Looking to take your product or service to market? In need of some commercial support?
Huduma specialises in providing commercial support for businesses and project consortiums who are looking to take their emerging tech products and services to market.