TIME-TO-MARKET (TTM) defines the period of time from the conception of a new idea to its market launch. In other words, it spans the time from the start of work on a product to the sale of the first piece. Especially for new market entrants, TIME-TO-MARKET is an outstanding KPI (Key Performance Indicator) - and very many product strategies aim to be the first to market with a new product.
Customers, but also the general public, often express quite loudly and vehemently the desire for new technology and change. How do companies react to this? If they are the first to present such suitable products, they can capture market share, achieve a unique selling proposition and generate profits. A short time-to-market also reduces labour costs and contributes to a faster return on investment. If, on the other hand, a company takes too long for TIME-TO-MARKET, competitors may already be offering the product, so that its own product then already looks outdated. But is speed the decisive metric for TIME-TO-MARKET? - Partly.
Being the first to place new technologies on the market usually aims to win early adopters who are willing to pay a higher price for the product and that, in addition, there are no competitors yet who could undercut the product price. Especially products with a very short life cycle, such as in the high-tech sector, require a short and direct TIME-TO-MARKET. Large companies regularly manage this and SMEs also succeed very well thanks to flat hierarchies, but often the focus in product development is completed too early and too quickly, so that the product does not yet meet all the requirements set. And more difficult: the problematic product makes it easier for precisely those competitors who come up with better offers to enter the market. In this respect, TIME-TO-MARKET must be well planned and weighed up.
TIME-TO-MARKET is measured in days, weeks, months and even years. During this time, there are different phases that can be roughly divided into product development, offer development and market testing. In the product life cycle, there are initially only costs, e.g. for market research, for the development of the prototype and the product, for communication and marketing, etc. These costs are not incurred until the launch and the product launch. Only with the launch and the introduction of the product on the market does this change and there is a profit that amortises the costs.
However, TIME-TO-MARKET is only one aspect in the product development strategy, just like functions, innovation and quality. Within this context, managers must weigh and make decisions to achieve product success. In order to improve the TTM and optimise it in their sense, some companies, for example, use release cycles such as major or minor updates. But what if this is not possible? Then companies often change their tactics in order to bring the product to the market with the right fit. As a short-term solution, the use of resources is often intensified, funds are increased, testing facilities or new development partners are also considered. Another option is a compromise, e.g. reducing features or quality or switching to an agile development process. Here, the input of selected market participants is integrated into the innovation process just as much as frequent iterations. Specially selected lead users recognise emerging problems of the product early on in the agile process and communicate the needs of the customers to the developing teams. These are interdisciplinary and are led by a product development manager who is experienced enough to recognise undesirable developments early enough.