We are particularly interested in the sales channels, i.e. all online and offline options that a target group has for purchasing your product. Which channels are already being used today and which channels do consumers of your new idea want to use in the future?
In the interviews on consumer behavior, the following W-questions are asked:
Where do your customers buy your product?
When do your customers buy your product?
How do your customers buy your product?
Why do your customers buy your product?
With this, we ask about the current and future purchasing and procurement behavior of organizations or individuals for products and services.
Then you discuss the following questions in the team, about the sales channels used by your consumers:
What are the technical and administrative requirements on the part of the sales channel for the new product and service?
What delivery requirements do we have to meet in order to use the sales channel?
Digital sales channels will dominate many areas in the future. However, this does not mean that we will only focus on these. Here again, the current and future demands and needs of the users are decisive in determining whether we will choose an analog or digital sales channel, or a combination of both channels, for our idea.
Within the sales channel, there are sales channel instruments that we want to use. The following W-questions lead us to these instruments:
What placement and presentation opportunities does the sales channel offer us for our new idea?
What sales promotions does the sales channel offer to market our product within the channel?
We then ask ourselves whether we will combine the individual channels and instruments:
Which activities in one sales channel support activities in another sales channel?
Which activities in one sales channel interfere with activities in another sales channel?
Without an intensive engagement with the existing market participants, in the market relevant for us, the creation of an innovation is not possible. This is how we get feedback from the market on our idea and see what products and services already exist. Our competitive analysis can start locally, but it is always international in scope. Store-checking, surveys, observations, photo-documentation and the graphical preparation of the entire competitive analysis in a large overview are helpful here. Another methodical support are checklists we have prepared, which show what the competitors stand out for and what we will not offer in comparison. We analyze the competitors' advertisements and online presence. We visit trade fairs, exhibitions and conferences to get into conversation with the competitors. We do not want to turn existing market players into time and information thieves, but into valuable sources of information about existing market conditions. In this way, we find the gap, the niche and the decisive piece of the puzzle that, as a USP, differentiates our product from the other competitors in the market.
If it's an innovation, we have no competition, right?
This assumption sounds understandable at first, but it leads us down the wrong path. Competitor analysis is so important because we need figures, data and facts about the relevant market, and only then can we determine which consumers' needs, i.e. which consumer needs, are not yet being met today. We want to offer our products at a certain price. Therefore, price analysis is relevant here. We inquire about consumers' subjective price thresholds in the interviews on the USP by asking a hypothetical question
What price would you pay for the product?
We document the prices objectively available in the market in our competitive analysis. Trade shows and conferences are the perfect place for us to meet and communicate with all the competitors in an industry. Worldwide, there is a very wide range of trade fairs for every product category, and it is worth flying to the USA or traveling to China in order to talk to market participants on site, check samples and make contacts. We prepare each trade show with fixed appointments on site so that we don't collapse at the end of the day completely overtired from randomly walking around. There are also a lot of trade fairs, conferences and exhibitions in Europe. We visit specialist exhibitions, conferences and startup events so that we can also exchange ideas with other founders.
And then we formulate the sales targets
What sales and turnover do we want to achieve per year with our new product?
In which sales channels should we achieve how much sales and revenue?
These can be quantitative and qualitative sales goals. With quantitative sales goals, it becomes clear that all other areas of the company depend on them. Here we want to ask the questions about the expected sales and turnover of our new product. The answers to the questions are entered in a table as a sales forecast, represented in quantity and value, and discussed in the team. We want to enter the corresponding values for an entire year, per month. In addition, we will create a table that shows our sales and revenue values per month and per customer. The tables are printed out in the appropriate size, understandable and easy to read for everyone in the team, and hung on a movable wall in our creative space. The Sales Forecast is the heart-lung machine of our operation. It is based on estimates and approximations when we do not yet have data in the here and now and for future months. Every new customer we acquire will have an impact on our sales and revenue.
How we estimate sales and revenue data if we don't know the market
This is another question we want to reflect on together as a team and move away from. No sales forecast in the world always contains the exact data that will actually occur. It is an estimate, and we need all the data collected from market and competitor observation in order to derive the sales forecast for our idea. When using trend studies for the forecast, we pay close attention to the year of the study, who commissioned the study and what methods were used to collect the data. We can use valid data from these studies for the estimates in our Sales Forecast. Extensive market research studies are very expensive, so the described route of using our own initiative and publicly available, free studies makes the most sense for us.
The qualitative sales targets describe our relationship with our sales partners
Which partners do we want to work with in which sales channel?
How should our product or service be presented in a defined sales channel?
Partners in the online and offline area can be wholesalers and retailers, a distributor, a sales representative or a sales agency.
Our sales forecast has a direct influence on our financial planning, our marketing planning, our personnel planning, our production planning and our procurement planning. The Sales Forecast sets the goals that guide all other areas of our business.
Do you have questions about your sales forecast, your sales channels and sales tools for your startup products? Contact me!
