Bringing a new product to market through effective commercialization is all about transforming innovative ideas into profitable, valuable, and impactful realities.
This process can be a beacon of opportunity, allowing you to capture more market share and showcase your winning products.
But market saturation, regulatory hurdles, and conflicting priorities can present some challenges. Therefore, a well-crafted commercialization strategy is crucial to make the process smoother.
In this article, we’ll dive into the commercialization process, including its benefits and a detailed breakdown of each phase.
What is commercialization?
Once a product has been designed, tested, and created, commercialization ensures its success in market. It involves a strong marketing strategy, as well as establishing robust distribution and production channels.
A successful commercialization strategy aims to make a product as profitable and valuable to the customer as possible. To do this, the strategy often includes post-launch support focusing on gathering customer feedback, improving the product, and maintaining customer satisfaction.
How is commercialization different from marketing?
Marketing is a subset of commercialization that focuses on one thing: attention. The main goal of marketing a new product is to promote it so that your target audience knows all about it — ideally before launch, but it continues well after the product hits the market.
This can involve creating content, setting up advertising campaigns, or PR activities highlighting unique selling points of the product.
Commercialization, on the other hand, is a broader process that involves everything to do with bringing your new product successfully to the market. This includes coordinating marketing efforts, establishing distribution channels, ensuring manufacturing capacity, and guaranteeing your products meet regulatory requirements.
Successful commercialization only occurs when all stakeholders and teams are aligned. Marketing leaders, sales leaders, product teams, business strategy professionals, partners, and engineers must all work together.
Commercialization vs. launch
A product launch is part of the commercialization process. However, commercialization involves the end-to-end journey and strategy that brings a product to market, which includes different elements, such as distribution, design, and manufacturing.
Engineers must work within timelines and milestones set during the commercialization strategy to optimize the product for viability and guidelines prior to launch. This process includes patent protection, public disclosure, and license agreements.
Product launches specifically refer to the introduction of new products to the market. A marketing team typically takes a lead role in a product launch, by creating collateral, enabling sales teams, and running launch events, or advertising campaigns.
The advantages of an effective commercialization strategy
Implementing a well-defined commercialization strategy has many advantages. Here are some of the most valuable benefits:
Maximizing market potential
The development process involves creating a product that resonates with your customers— which is difficult without any information on your potential buyer.
A successful plan will include research on the target market, competitive landscape, and customer needs to tailor your product offerings to be contextually relevant to your customer base.
Market segmentation and positioning can ensure you reach the right audience and capitalize on untapped opportunities.
Better competitive advantage
Your product’s success is dependent on its timely delivery to market and that it is both unique and solves a major pain point. Incorporate competitor analysis into your plan to determine what market share size you can grow into and to understand their preferences. That way, you can tailor your commercialization strategy to differentiate your offerings.
Strategic partnerships and collaborations with complementary businesses can turn your competitors into allies. Technology transfer from research institutions or local organizations can also enhance your competitive position.
Improved resource allocation
All brands must consider their expenses and how they allocate their time and resources.
Small businesses and startups must consider their team’s activities, particularly in marketing, product development, distribution, and sales.
Planning helps with effective resource allocation to minimize waste and maximize your profitability.
No successful companies have experienced growth and development without some level of risk. Identifying and addressing risks early in the process can help you plan for contingencies more effectively and determine your risk appetite and operational excellence.
Conduct market validation tests and protect your intellectual property by establishing partnerships and patent applications. Adapting to the circumstances can drastically improve your chances of product success.
Breaking down the commercialization process
Now that we’ve explored the benefits of a well-thought-out commercialization strategy, let’s define the process.
1. Market research and analysis
The first critical aspect of commercialization is conducting market research and analysis to develop an idea that is both viable and solves a pain point (one that customers are willing to pay to solve).
Especially from an engineering perspective, market research allows your team to identify customers’ needs and preferences and what the competitive landscape looks like.
This will help the product design and manufacturing process to align with your target market’s demands. Ensuring everyone is on the same page from the beginning is a collaborative approach that enables a better understanding of the process and your customers’ expectations.
2. Business planning
A commercialization process should complement product design and development. Once you have conducted your market research and analysis, it’s time to use a data-driven approach to lay out a strategy that will make you competitive.
You will identify key milestones, objectives, distribution channels, and a pricing strategy for the product. At this step of the process, it’s vital to achieve synergy with the engineering and business teams to ensure everything aligns with the overall commercial strategy.
The integrated approach helps your business make better-informed decisions for resource optimization and the overall market potential of your prototype.
3. Product development
The product development stage is where art meets science, manifesting an intangible concept into a viable service or product.
Efficient product development requires seamless collaboration between designers, stakeholders, and engineering teams. This can be challenging due to different interests, lack of communication, and improper delegation at various process stages.
A comprehensive product lifecycle management (PLM) solution like Duro’s manages design iterations, streamlines collaboration, and tracks project milestones. This ensures communication is transparent throughout your teams and gives everyone a single source of truth to work with.
Duro’s PLM software helps optimize your product development process, improving product quality and synergy and leading to a faster time to market.
4. Intellectual property protection
Taking your innovative idea and making it into a tangible product comes with some challenges that exceed pricing, designs, and customer expectations.
Patent applications, patent protection, copyrights, trademarks, and trade secrets aren’t just assets to your brand — they help protect you and give you a unique competitive advantage.
Potential investors, partners, and licensees look more favorably at companies with these protections in place. Securing these rights prevents unauthorized use of infringements and fosters a conducive environment for commercial successand innovation.
5. Manufacturing and operations
Depending on the nature of the product or service, manufacturing processes or operational infrastructure may be required to identify partners, components, quality control measures, and even optimize production efficiency.
Engineering needs to work with Manufacturing to align product specifications with the constraints and requirements of product manufacturing. This is essential for product quality, consistency, and cost minimization.
6. Marketing and sales
It’s not just important to build a viable product that dominates the competitive landscape, but it’s equally pivotal to get the message out. Marketing activities may include advertising, public relations, digital marketing, and sales promotions. Sales efforts, meanwhile, focus on reaching out to potential customers, negotiating contracts, and closing deals.
Without advertising, sales promotions, public relations management, and creating hype, there will be a lack of awareness, buzz, and demand for your product.
7. Product launch and distribution
A well-executed product launch generates the initial momentum needed to build excitement and establish a market presence. Collaboration between engineering, operations, marketing, and business partners is vital to synchronize the product launch with its supporting marketing initiatives and distribution timelines.
8. Customer support and feedback
Your journey doesn’t end when the product becomes available. Once in your customer’s hands, it’s critical to gather product feedback at regular intervals. Not only does this help monitor customer satisfaction, but it also gives you actionable insights into how to adapt the product to improve it.
Customer support plays an important role here as well, and can provide a wealth of insights into which elements of your product are working and which aren’t. Do they receive the same questions or complaints frequently? If so, these areas need immediate attention from your team as you iterate future product generations.
Execute your commercialization strategy with Duro
Successful commercialization requires careful planning, market research, business analysis, and ongoing customer support and feedback.
Along the way, there must be an effective collaboration between your product development, manufacturing, operations, marketing, and sales teams.
With Duro’s PLM software, you can effectively cut down the friction between each stage, forming a seamless experience to improve your time to market and develop your product with confidence.
Request a demo of Duro to take your first step toward successful commercialization!