When you are on the verge of launching a new product, execution is key.
You need a sound strategy to position your new product wisely, attract the right audience, and ensure that your product sells. But, most of all, you need enough capital to execute your new product’s successful launch.
As your business grows, you need to constantly reinvent or introduce new products so you can keep on thriving. But, at the same time, remember that you need to have sufficient cash flow for the rest of your business operations. So, how can you ensure that your business chugs on like a well-oiled machine while you focus on launching new offerings?
Here’s where a small business loan helps by giving you the necessary push to execute your strategy.
Let us now take a look at how it works and how it helps launch your product in a new market.
Using a small business loan for launching a new product
Without the capital needed to execute a strategy, businesses may tend to repeat the same operations for a long period. The only way to push ahead is by taking measures to ensure a steady cash flow. A small business loan leverages by giving you the necessary capital needed to venture into a new market. Since it comes with attractive interest rates, it can be a cost-effective option for you.
But, you still might wonder how you can put to good use small business funding. It is better to have a strategy once you have the funds to make the best use of it.
Here, we walk you through 5 ways to launch your product effectively.
1. Market research & analysis
Before you even think of launching your new product, ensuring you perform market research on the idea is crucial. Without knowing if your product has good market potential, investing in creative marketing strategies wouldn’t be fruitful. Market research and analysis ensure that your idea is valid and has the potential to explore.
While secondary research is easy to get, it’s only through primary research that your business can discover new arenas to market to. With a variety of factors that give you credibility, it’ll give you indicators that your product has a success rate. Some of the factors that market research and analysis cover are:
Market size: The potential for your product to compete in the existing market
Pricing: How your product pricing competes with existing competitors
Market share of existing competitors: This shows how many opportunities you have to capture the existing market
Barriers to entry: Shows what factors influence your entry into the market
Your unique selling point: Shows how your product solves a unique pain point or offers something new
Gathering information about these factors also requires some investment. The preliminary research needed to conduct can cost you, and a small business loan can help you with the funds to ensure proper research.
2. Pre-launch activities
Even before you launch your product, there are a myriad of aspects to consider. From generating interest to building up anticipation, getting your prospects eager to want to try your product helps your business scale in the future. But, the marketing efforts needed to do this can be expensive, and you may need some external funding.
With small business funding, you can be sure to engage in marketing activities that hype up your audience just in time for the launch. This can be a mix of organic and paid marketing, with an SEO and organic social media approach and using paid ads to reach your audience.
To secure a bigger market share, unconventional methods can help get the desired reach. This can be through influencers or building relationships with potential clients pre-launch. All these activities are promising as they yield results
3. Strategic partnerships & collaboration
As the risk involved in a new product might be high, it can be beneficial to have other people involved to mitigate the risk. Strategic partnerships are one way to reduce risk and improve your business prospects.
These can be from new partners entering the market or existing players who can provide a high potential to your target audience. Strategic partnerships may need small business funding as marketing to these parties can have a variety of costs.
a) Strategizing: One of the effective ways to both beat competition and reduce risk, strategizing can be a great way for businesses to stay relevant.
b) Screening and selecting: A time-consuming process, getting the right partners for your business takes time. While there may be a whole bunch of partners ready to form alliances, it is best to sift through the entire list before jumping to conclusions.
From strategizing to screening potential partners, the time and effort that goes into sifting them can be high. As this is a long-term strategy, ensuring the right fit is beneficial for both parties.
Furthermore, predicting the future of such alliances can be challenging, as it can be hard to say in which direction the product may go. Creative marketing strategies thus ensure that both parties are on the same page when your new product takes expected or unexpected directions.
4. Customer acquisition strategies
Getting the basics right is essential for any business. When you are launching a new product, you might see your customer acquisition costs go through the roof. A small business loan gives you leverage by providing the funds to ensure you have enough customers to pay for in the future. As customer acquisition always costs money, a steady cash flow is necessary to ensure the proper handling of resources. Here are three reasons why:
a) Managing business expenses: It is through customer acquisition that a business pays for all its expenses. Whether it be employee salaries, meeting overhead costs, or even venturing into other markets, it all comes down to effective acquisition.
b) Costs of digital marketing: If your business is in the digital space, different costs pop up, although the process would be the same. You would be majorly spending on online channels such as display ads and paid ads, all of which need immediate short-term funding. With the necessary boost reached and customers pouring in, earning back the capital spent would be fast. This gives you the luxury and benefits to consider taking a business loan for your needs.
3. Costs of driving your customer acquisition strategy: The process of driving a customer acquisition strategy can also be extensive. While marketing focuses on the initial stages of the product, customer acquisition focuses on the final stages, meaning it’s more dependent on execution rather than drawing up plans. For you to execute such a strategy, it’s best to have a solid cash flow backing your plans.
5. Inventory and manufacturing costs
For traditional companies, a huge part of costs goes toward manufacturing and inventory costs. Even if these processes get done by third parties, the expenses towards them can vary higher or lower depending on the circumstances.
Keeping up with regular inventory is necessary to have a continuous business, and timing your manufacturing is also important as, depending on the product, it can take several hours to days to manufacture it.
A business loan can take the load off by ensuring a constant supply of materials for your business. As it gives you the money to keep your inventory in check, paying back on your loans becomes easier in time.
Using a business loan for your product
As we explored five ways to use a business loan for your product, it can give you a glimpse of how effective such an investment can be.
With Tata Capital, you can avail of our business loans to ensure your business has the capital to launch your new product. Whether it be a short-term or a long-term plan, our attractive interest rates will let you achieve your goals easily.
Visit our website to learn more and apply online.
16 August 2024
7 mins read
Previous Post
