Avoid the big bang approach with product announcements

Many small companies, especially technology firms, believe they have to make a big splash with their new product announcements. Be it an expensive special event or an aggressively marketed promotional program, the small company thinks the big bang is an effective way of having an immediate effect on the marketplace.

But unless the business has highprofile backers or principals, odds are good the big bang rollout will fizzle.

For one thing, most new products have bugs or fixable flaws that don’t emerge until real users have had a chance to try it out. Often, a small company with a new product gets one shot with a customer. A big bang event ensures that all early users will get the same shot at the same time — and be exposed to the same earlyuser problems.

Two other related reasons to avoid the big bang event are cost and cash flow: A big event costs a lot of money paid out over a relatively small timeframe while typically providing but a single opportunity to communicate about the product.

For a similar investment, a company might implement a number of smaller events or programs, each of which provides an opportunity to speak to a part of, if not all of, the target market. Keep in mind that a company might be able to finance a number of small events with existing cash flow, whereas the large expenditure of a big bang might require it to seek financing.

A much less risky approach for a startup or small company is to use a pilot program approach. You promote the new product to one market segment and use what you learn to fine tune the product, price, positioning and marketing approach.