Sunday, March 1, 2009

Commercialization: the "final" stage in product development?

The pilot test is a success! We roll out the product and we're done - right?

Well...

Not really.

First, remember that product development is a cycle - once the new loan product is "out there" the smart MFI will continue to gather client feedback on it, for example through exit surveys and regular client satisfaction research. If the MFI has an integrated marketing program, then that data can be used to further refine the product or get ideas for new financial products and services.

Next, remember that new products effect more than just the credit department. Their administration will impact MIS, human resources, finance, and perhaps even general office management. Staff in all departments may need training in how to cope with the new product. Generally, the sooner you can bring other departments into the product development process, the better (i.e. during the pilot test phase), but typically product roll-out will require an extra "push".

On a final note, the commercialization phase is also the time to implement a promotional program for the new product. I can hear the chorus of shrieks from microfinance managers already -- we don't need advertising, we use word of mouth, or direct sales. Direct sales has proven to be effective in microfinance, and word of mouth is great (if you cultivate it -- it doesn't just happen), but both direct sales and word of mouth can be more effective (i.e. you can increase your clients per loan officer) when backed by a promotional program and a strong brand name.

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