Why 90% of New Products Fail? Lessons from Merle Crawford’s New Products Management

Introduction

Bringing a new product into the market is often described as a gamble. Many ideas sparkle in brainstorming sessions, but fizzle out when faced with market realities. That is where Merle Crawford’s classic book, New Products Management, steps in. It provides a systematic, managerial, and marketing-oriented framework for turning innovation into a profitable reality. First published in the 1980s and refined across multiple editions with co-author C. Anthony Di Benedetto, the book has become the bible for product managers, entrepreneurs, and students of marketing.

This article distills the essence of the book, exploring its principles, frameworks, and lessons, while adding case studies, FAQs, and recommended readings to give you comprehensive knowledge without flipping through the textbook.

Why This Book Matters

Innovation drives business survival. According to industry statistics, 80–90% of new products fail. Crawford’s book answers the critical question: What separates winning products from the ones that vanish unnoticed? The answer lies not in luck, but in disciplined management of the innovation process.

The book is divided into five major parts:

1. Opportunity Identification and Selection
2. Concept Generation
3. Concept/Project Evaluation
4. Development
5. Launch

Each part covers not just the what but also the how of product management.

The Philosophical Core: It’s a Process, Not an Event

Crawford’s central thesis is that new product development is a managed process, not a random or purely creative event. Success isn’t accidental; it’s the result of meticulous planning, rigorous evaluation, and cross-functional collaboration. He argues that a systematic approach significantly de-risks innovation and improves the odds of launching a winner.

Key Pillars of Crawford’s Philosophy

1. Consumer-Oriented: Every decision must be grounded in a deep understanding of customer needs, wants, and behaviors.
2. Strategy-Driven: Innovation must align with and support the overarching goals of the firm. Not every good idea is the right idea for a particular company.
3. Multifunctional: NPD is not R&D’s job or Marketing’s job; it is a team sport involving every function from finance to manufacturing.
4. Risk-Managed: The process is designed to identify and kill weak projects early, before massive resources are committed.

The Crawford Framework: The Stage-Gate® System (Pioneered by Cooper)

While Crawford’s work encompasses the entire NPD universe, his explanation and endorsement of the Stage-Gate® process (pioneered by Robert G. Cooper) is a centerpiece. This system divides the innovation journey into distinct stages separated by management decision gates.

At each Gate, a cross-functional team of managers reviews the project’s progress against pre-defined criteria (e.g., strategic fit, market attractiveness, technical feasibility, financial ROI). The decision is always one of four: Go, Kill, Hold, or Recycle.

This “funnel” approach ensures that only the best ideas progress, conserving resources for projects with the highest potential.

Deep Dive into Critical Concepts from the Book

Opportunity Identification and Selection

• Product Innovation Charter (PIC): Crawford introduces the idea of a PIC, a written document that defines the role of innovation in a company’s strategy. It aligns the product team with business goals and reduces wasted efforts on “random” ideas.
• Strategic Fit: New product ideas must align with the company’s resources, market position, and long-term strategy.

Example: 3M’s famous Post-it Notes came from a failed adhesive experiment, but it succeeded because it fit into 3M’s charter of innovation in office products.

Concept Generation

• Sources of Ideas: Customers, employees, competitors, R&D labs, and even serendipity.
• Methods: Brainstorming, crowdsourcing, ethnographic research, and open innovation.
• Cross-functional Teams: Encouraged to blend marketing, engineering, design, and finance into ideation.

Case Study: P&G’s “Connect + Develop” model shifted the company from internal-only innovation to open collaboration, leading to products like Swiffer and Febreze.

Concept/Project Evaluation

• Screening: Filtering out ideas that lack market potential or feasibility.
• Financial Analysis: Techniques such as Net Present Value (NPV), Payback Period, and Expected Commercial Value.
• Concept Testing: Early feedback from potential customers to prevent costly missteps.
• Risk vs. Reward Balance: Encourages managers to avoid both over-commitment and excessive risk-aversion.

Real-Life Insight: Apple reportedly killed dozens of iPod prototypes before finalizing the iconic version launched in 2001.

Development

• Product Protocol: A detailed plan describing the target market, product positioning, key benefits, features, and requirements. This ensures the R&D team knows exactly what to build.
• Prototyping: Iterative creation of models to test feasibility.
• Market Testing: Use of test markets, beta testing, and pilot launches.

Example: Tesla often uses “beta launches” (like the early rollout of the Cybertruck) to refine its products based on real-world feedback before mass adoption.

Launch

• Commercialization: Full-scale production and market entry.
• Marketing Strategy: Positioning, pricing, promotion, and distribution.
• Post-Launch Review: Analyzing sales, customer feedback, and ROI to refine the product or future launches.

Case Study: Nintendo Wii (2006) succeeded because of careful positioning, not as a competitor to Xbox or PlayStation in graphics, but as a family-friendly gaming system.

Tools Introduced by Crawford

• Product Innovation Charter (PIC) – The “constitution” of new product development.
• Product Protocol – A guiding document bridging marketing and R&D.
• Portfolio Management – Balancing high-risk and low-risk projects in a product pipeline.
• Stage-Gate Process (Influence) – While not invented by Crawford, the book emphasizes structured phases in product development.

Case Studies of Success and Failure

Success

Apple’s iPod: Apple followed a rigorous process: identifying consumer frustration with existing phones, developing prototypes, aligning with strategy, and executing a blockbuster launch. Every step reflects Crawford’s model.

3M’s Post-it Notes: A classic case of turning a “failed” adhesive into a blockbuster via persistent concept testing and internal champions, highlighting the importance of opportunity recognition.

Failure

New Coke: Coca-Cola skipped deep concept testing and underestimated emotional attachment to the original formula. Crawford’s evaluation stage could have prevented the blunder.

Boeing’s 787 Dreamliner: A cautionary tale of development team challenges, where supply chain issues delayed launch, underscoring cross-functional coordination.

Frequently Asked Questions (FAQs)

Q1: Who should read this book?
Students of marketing, aspiring product managers, entrepreneurs, and corporate executives are involved in innovation.

Q2: Does the book only focus on consumer products?
No. The frameworks apply equally to B2B, services, and technology-driven products.

Q3: Is the book still relevant in the digital age?
Absolutely. While technologies evolve, the principles of disciplined innovation management remain timeless.

Q4: How is it different from lean startup methods?
Crawford provides a structured managerial roadmap, while lean startup emphasizes rapid iteration. The two approaches complement each other.

Q5: What makes NPD so difficult, according to the authors?
High uncertainty, cross-departmental coordination, and balancing speed with quality; they note that strong leadership and data mitigate these.

Recommended Readings

If you want to deepen your knowledge beyond Crawford’s book:

• “Winning at New Products“ by Robert G. Cooper – Focuses on stage-gate processes with empirical data.
• “The Lean Startup” by Eric Ries – for agile product launches.
• “Crossing the Chasm” by Geoffrey Moore – on scaling tech innovations.
• “Blue Ocean Strategy” by W. Chan Kim & Renée Mauborgne – on creating uncontested market space.
• “Ten Types of Innovation” by Larry Keeley – on innovation frameworks beyond product design.
• “Inspired: How to Create Tech Products Customers Love“ by Marty Cagan – Practical for software product managers.

Key Takeaways

1. Innovation must be strategically guided, not random.
2. Cross-functional collaboration is the lifeblood of successful products.
3. Testing, prototyping, and evaluation reduce risk.
4. A disciplined process turns creativity into market-winning products.

Conclusion

Merle Crawford’s New Products Management remains a timeless compass for navigating the uncertain waters of product innovation. It blends strategy, discipline, and creativity into a coherent roadmap. Whether you are a student looking to understand innovation, a manager trying to reduce failure rates, or an entrepreneur aiming to disrupt industries, the lessons from this book are indispensable.

In a world where consumer preferences shift overnight and competitors innovate relentlessly, Crawford’s message is clear: success in new products is not luck, it’s management.

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