New products encounter cold eyes from the market

Shenzhen Silicon Sense Technology Co., Ltd. began to produce its own business card scanner - Mingshitong in 2000. Its composition is not complicated, a scanner is equipped with an OCR (optical character recognition system) software, plus a business card management software.

"Mingshitong" can easily handle a large number of business card data, reducing users' troubles in storing and searching. Like most new IT products, "Mingshitong" has its own characteristics. First, it is light and compact. The size is only the size of the palm of an adult, and it can be put in a briefcase and carried around. Second, the OCR recognition rate is high, and the single-word recognition rate is over 99%. Those who are engaged in secretarial work need it most. In addition, business managers, government officials, lawyers, marketing, journalists, advertising public relations and other industries are also potential customer groups.

But unexpectedly, the market response was not as enthusiastic as expected. Huang Song, executive vice president of marketing at Silicon Sense Technology, revealed that the actual domestic sales were less than 50% of the expected.

Why does this result occur? Silicon Sense Technology has analyzed it from the following aspects.

1) "Mingshitong" is actually a hardware product that needs to be packaged with an OCR software before it can be used, but the use of OCR software is regional. Simplified Chinese OCR software is only suitable for use in mainland China. As for some special language countries, such as Japan, the local OCR software must be matched with "Mingshitong". This has set up obstacles for the promotion of "Mingshitong" in a wider range.

2) Today's computer penetration rate is still not high, which is also a reason to limit the popularity of business card scanners. Huang Song raised a question: How many people in China actually use computers for business reasons? A similar situation exists in overseas markets as well. To survive and develop, "Mingshitong" needs a certain level of computer penetration. Huang Song admitted that this factor was not taken into account when conducting market assessments.

3) Consumption habits. Nowadays, the most common practice for people to manage business cards is to use business card holders, or to write relevant content in a notebook. In fact, these people need products such as "Mingshitong", but in the short term, they will be very unaccustomed and worry that they will not find the information they need.

4) Due to the problem of insufficient product market volume, it is difficult to continue to reduce costs, which is also a factor affecting sales.

In response to the above problems, Silicon Sense Technology is also taking some positive measures to improve it. Huang Song said that in terms of hardware, they have to make breakthroughs: turning black and white scanning into color scanning; single-sided scanning of business cards into double-sided scanning; improving scanning speed, etc. In terms of software, strengthen cooperation with OCR software vendors to jointly develop and improve the quality of software products. In terms of market operation, software manufacturers are encouraged to sell products so that more consumers can see and feel the products.

Dear readers, what do you think of the current market situation of "Mingshitong"? Can the measures taken by Silicon Sense Technology be effective? What advice can you give them?

[Case Study]

A product cannot open the market, the reasons may involve many aspects such as market demand, product itself, promotion strategy and so on. As far as this case is concerned, Silicon Sense Technology Company lacked in-depth understanding of the needs of target customers when looking for the reasons for the market gap of "Mingshitong". And the measures they have taken have not helped to solve the problem fundamentally.

The users of the CEConline website suggested that Silicon Sense Technology should conduct a second evaluation of the market and products, first to understand the market potential and consumption behavior, and then to improve the products and promotion strategies.

Market research should come first

Confidence in products should be based on detailed market research, re-evaluation of market capacity will help Silicon Sense to formulate effective strategies and Strategy.

Where is the market positioning? Although the target consumer group of "Mingshitong" is clarified in the case, the restriction on the use of computers is mentioned in the analysis of the reasons for the poor sales, which shows that the target market positioning of the product is still not enough clear.

The website user "Dan Yunpeng" believes that, according to the description of the case, its target market is limited to the customer group involved in processing and searching for a large number of business card materials and easy to use the computer. As a result, the originally predicted market potential will shrink. Next, it is necessary to study the market growth rate to see whether the company has the strength to support the entire process of market cultivation and growth. If the total market volume is insufficient, it is necessary to conduct research on the product market positioning to see if it can expand the use of other potential demand markets to make the target market large enough.

The website user "dragonteam" suggested that relevant experts be invited to discuss how big the market demand is. "Dragon Bamboo" of a technology company in Guangzhou also believes that the top priority of Silicon Sense Technology is to divide the target consumer group and focus on attacking.

What are the customer needs? "Chen Weiming" from a business consulting company said in the discussion: "The key is to understand your target customers. Your products contain too much information, and you need to use color scanning to change the color form of business cards. It's all saved, is it necessary?"

"jiem_ou" of a business management consulting company in Beijing also suggested that before formulating the overall strategy, the voice of consumers should be listened to and the application problem of consumer demand should be solved. He believes that consumers will be very concerned about two aspects, one is the effectiveness of use, that is, the scanning resolution, error rate, etc.; the other is the convenience of data use, the scanned data and office equipment (such as mobile phones, computers, etc.) connectivity issues to be resolved.

When conducting in-depth research on consumers' consumption behavior, "Dan Yunpeng" suggested two aspects: one is the research on the process of storing business cards for potential target consumers; Determine whether the product can actually meet the needs. A market research firm's "bingoye" elaborated on specific survey questions, making a detailed list, including who the consumer is, why they buy the product, how to buy it, what to expect before buying and what the post-purchase experience is like ten a few questions.

The product is the most fundamental, and the best marketing plan is useless if it doesn't work. "Dan Yunpeng" analyzed in the discussion that the product meets the needs of customers. First, the product can solve the actual problem of the customer. Second, the product is simple to use and the cost is reasonable. Costs include purchase costs and usage costs. Procurement costs include time consumption costs, additional expenses and product prices in the procurement process. The cost of use includes the cost of learning before use, the cost of time consumed by use, the cost of material consumed by use, and the expenditure of additional accessories required for use.

"Mingshitong" has gaps in both aspects. Users of the CEConline website believe that improvements can be made in the following areas.

Reduce the error rate The "white knight" from a technology company in Beijing is a worker in the OCR industry. He said in the discussion that the total sales volume of all such products on the market is only tens of thousands of sets per year, and even The first merchant to make this product also quietly withdrew from the market. One of the fundamental reasons for this situation is that many products have poor recognition rates. After scanning, there are a lot of error messages, and there is only one word for comparison and confirmation, manual modification, and it takes more time and energy to change a business card, it is better to enter it manually.

"bingoye" feels the same way, he used similar products, but now he has given up. Because every time a business card is scanned, there will be some errors. He said: "The so-called recognition rate is calculated by the number of words, not by the business card. If it can reach 100 business cards and there are a few errors, it is tolerable, but I am afraid that one of the two or three business cards must be scanned. Problems, especially e-mail addresses or something." So, only by reducing the error rate can you reduce customer churn and attract more customers.

Adding product features and integrating with other products Although Silicon Sense is adding some features to "Mingstone", these are not required. "Dan Yunpeng" believes that "Mingshitong" requires additional configuration and storage time such as OCR software, which will restrict product sales. Moreover, "turning black-and-white scanning into color scanning and business card single-sided scanning into double-sided scanning will have some positive effects, but this is not the root of the problem. This will not only increase production costs, but may not change the fate of products. It is recommended to use it during the product growth period."

The real increase in product functionality should be based on consumer convenience while reducing additional costs. The "fifth practice" of a company in Suzhou said that although the starting point of Sigan's products is to provide convenience to consumers, it actually adds a lot of trouble to consumers. Nowadays, people have to carry a lot of things on their bodies, so who would want to add something as big as a palm. He suggested working with mobile phone vendors to make this feature available on mobile phones. "ltj" of an advertising company in Shandong thinks this is a good idea. Mobile phone users are a very large market, and the functions of mobile phones are improving day by day, making them an essential tool for business people. If Mingshitong can enter it into the mobile phone address book immediately after scanning, it will be beneficial to both mobile phone and software vendors.

Website user "Hunan Laogao" believes that when laptops and PDAs have been used more and more for daily affairs management, Mingshitong does not provide more fresh things, and no one is willing to scan for them The function brings an extra burden. Therefore, he suggested that the company should expand the product functions as soon as possible, and should provide a complete mobile information system solution with scanning and handwriting recognition functions. "It must provide most of the functions of the PDA, and provide interfaces with other digital devices."

In terms of form, a power supply company's "Yijianpingjianghu" suggested that it be designed in the form of a small address book, which is convenient for users to carry around.

"White Knight" believes that it is difficult for Silicon Sense to sell this product as hardware, and it is difficult to do well in the market. Because this product relies on software technology to achieve its functions, Sigan should not position itself as a hardware manufacturer, but should position itself as a provider of business card scanning and identification management solutions.

Adjusting the price and promotion strategy

"White Knight" believes that the high price of the product is the biggest obstacle in promotion. During the discussion, he said that a small micro-scanner plus a set of software would cost more than 1,000 yuan. Buying an ordinary scanner of A4 size is only four or five hundred dollars. And a set of business card recognition and management software sells for the same price as Windows, which makes it hard to understand. Excessive price barriers have never been able to expand the market.

"jiem_ou" suggested that you can consider the strategy of popularizing it at a low price to make it popular first, to get a large number of consumers, and then gradually increase the profit by adding value-added services.

In the promotion process, expanding publicity is also an effective way. Because there will be more or less problems in the listing and sales of any product, it is very important to guide the market at this time. A "miss chen" from a real estate company in Beijing believes that the market for many high-tech products needs certain guidance, and consumers' potential purchase desires also need to be further explored. The "Wandering Squirrel" of a technology and trade company in Beijing suggested expanding publicity efforts. For example, he said that the business card scanning products of a certain brand sell well in the months when the market is promoted, but otherwise it is not ideal.

On the other hand, a more flexible sales model is required. "Dan Yunpeng" believes that the company can increase its marketing efforts, clarify marketing and promotion strategies, formulate relatively reasonable prices, and formulate various promotion methods, such as free trials, instant learning and use, software packaged gifts and other sales models. Effective group promotion. A communications company's "Ted" suggested that the product should be bundled with mobile phones, PDAs, and other similar business communication products, just like Intel and Microsoft bundled computers.

In terms of sales channels, the "let more people feel the product" mentioned in the case is true, but the practice of "selling by manufacturers" should be reconsidered. What kind of marketing channel model is adopted is very important to the sales of the product. He suggested that the combined channel model of direct sales and distribution should be adopted in combination with the actual situation of the enterprise.

"Drucker" from a technology company suggested selling "Mingshitong" as a practical high-tech digital gift, focusing on the gift brand. "Long Gui'er" of an electronic industry company in Guangdong said in the analysis that this product and PDA belong to the same kind of products and are fashionable products. If the appearance and shape of the product are properly improved to make it more generous and beautiful, it is Can be given as a gift.

In addition, website user "Elliott" suggested that if there are products that can meet the needs of the international market and have good sales performance, they can also concentrate on the marketing work in the international market.

This article was compiled by Marisa Wang. For more case studies and online discussions, please visit the CEConlines website (www.cec.globalsources.com).