Time to Market (TTM) – What is it and why does it matter for my business?
#product strategy #project management
Time to market (TTM) refers to the amount of time from the moment of conceiving the idea about a product through to launching the final product or service to customers. Everyone involved in the development of the product or service has an impact on the TTM achieved. The concept is most commonly used for new products or services, or new features of existing products and services. The term can also be used for the time for a new marketing campaign to get to market, or for a new process to go live. The concept might occasionally be referred to by the term speed to market (STM). However, TTM is not always just about speed, as we will see below.
In this article we look at:
The importance of TTM
How to measure it
Decision making about TTM
Examples from different industries
The Importance of Time to Market
In the fast-moving and extraordinarily competitive business environment of today, being first gives you a first-mover advantage. This has the benefit of you gaining good brand recognition and product loyalty before other companies get to market with similar products. If your TTM is slow, other companies may already dominate the market by the time you get there. This means you will be playing catch-up. Critically, being slower is proven to lead to lower profitability for a product.
On the other hand, by speeding up TTM you:
1. Increase revenues – the sooner you get your product or service onto the market, the quicker you can start bringing in revenues. This means increased revenue capability overall for the product.
2. Lower costs – the lower the amount of time taken to get the product to market the less you will be spending on producing it in many cases. It stands to reason that this lowers costs and has the effect of increasing profitability of the product.
3. Increase potential market share – if customers do not yet have another solution to choose from, the possible market share your business can gain is higher.
For these reasons, TTM is an essential point to focus on so you can leap on opportunities quickly as they arise. This helps your company secure a hold on the market.
Time to Market Examples
There is considerable variation between industries. For example:
Software – TTM in this industry may be anything from half a year to up to five years, depending on the complexity of the product. For example, the first version of Airbnb launched in 10 months.
Cell phones – cell phones commonly have a TTM measurement of between one and three years.
Vehicle manufacturing industry – the TTM for cars tends to be somewhere between three and five years.
Energy products and services – in this sector, TTM can start out at the low end at approximately seven years. It can increase to 20 years for some types of products and services.
Pharmaceutical sector – in this area, time taken is typically from around nine to ten years up to 19 to 20 years. Covid-19 vaccines were the exception to this rule, due to tremendous international pressure.
Aerospace and Defense industry – in this sector the time frame can range from anywhere between three or four years up to 22 years.
From examining these few examples, it can be observed that where safety may be more of an issue, TTM is longer. The complexity of a product is part of the reason for this. However, this is also partly down to the degree of regulations and testing that are required for these types of products.
Types of TTM
Some experts say there are different types of time to market. This varies depending on the specific element of the cycle time to be enhanced. The options include:
This is perhaps the best-known type of TTM. This is focused on getting to the market first above everything else. It can be especially important in the technology industry where obsolescence can be an issue. In some technology sector scenarios, getting there first is everything.
Some organizations focus on the capability to change or improve the features of a product faster. The goal here is to do this without adversely impacting on the product launch date.
Another type of TTM is an emphasis on being predictable. This can be important in certain types of industries where seasonality is critical. In these cases, timely delivery is everything. An example would be any product related to Christmas.
Time to Market Decision Making
Being first to market can lead to important benefits for the business. Yet it also involves making some key business decisions about how this is achieved and whether it is worth it. Some of the decisions to consider are as follows:
1. Fast time to market versus product quality – being first to market will not be beneficial if the product or service released does not meet the most basic expectations. Make sure what you release is at least an MVP (minimal viable product). Companies that are slower to market but release a vastly better product may win out.
2. Hire more resources versus controlling costs – sometimes more resources mean turning around a product faster. For businesses that are controlling costs, this might not be possible. Increasing resources can lead to a project becoming more expensive.
3. What to include versus what to leave out – a typical tradeoff is between different types of features that you may want to include. To improve TTM you will likely have to prioritize some features over others. Yet leaving out critical features may make your product less appealing to some customers. This is a fine balance.
How to Measure Time to Market
To improve, you have to know how to measure TTM. For obvious reasons, TTM is measured in units of time. Depending on the type of product, you might perhaps measure it in months, weeks, or days. One method is to start tracking it immediately when the business decides to take an idea forward. You can stop tracking it when the first version is launched (is available for purchase). Some businesses have a KPI that they measure performance against and evaluate their effectiveness. However, this concept is not always measured in exactly the same way. Some companies have a measurement formula that starts once the idea is approved. Others start the measurement process when the project first has resources assigned to it. Sometimes there may be a lot of time between product go ahead and project staffing. This time period is known in TTM terms as the “fuzzy front end”. At the other end of the spectrum, the end of the TTM process can also be pinpointed differently. Some measure it at the point when the product goes into manufacturing. Others measure it at the point when the product first hits the market. Others still look at it as being when the first person or company makes a purchase.One issue with measurements is that you may not be comparing like with like. Some projects are naturally much more complex and intricate than others. These projects require greater resources and will usually take longer to launch. This means that making a comparison between different projects can be difficult.
How to Accelerate Time to Market
There are numerous ways to speed up TTM. One obvious way of shortening it is to assign more resources to the project. More people can help by addressing bottlenecks. In some cases, more people can create more issues and slow up the project. Avoid this by carefully analyzing where more people might really help.
Other options include any of the following:
How to Accelerate TTM
Use a minimum viable product (MVP)
MVP allows you to enter the market quickly with a product that solves a customer problem. It is not without risk, but it does offer a considerable competitive advantage from achieving first-mover status.
Measure and evaluate your results
One of the best ways to improve is to measure what you are doing. Look at the time taken and pinpoint where improvements can be made. Everyone in the team can feed into this activity and you can all brainstorm ideas for improvement.
Consider what you are doing and why. Processes may introduce unnecessary bureaucracy and bottlenecks that are slowing up your TTM. Streamlining workflow can cut out a lot of time.
Use automation where possible
This is linked to refining processes. There may be opportunities to speed up workflows through automation. Automation also has the benefit of lowering the risk of mistakes. Mistakes take up unnecessary time.
Use agile working
Agile is a methodology used for project management and especially in software development. Work is undertaken in short “sprints” and the development is iterative. This approach helps to speed up product development.
Change is constant. Being able to adopt a flexible approach can help your business overcome changes faster. For example, regulations can change, or competitors might introduce a product that impacts your strategy. Being flexible enables a faster reaction time to change, speeding up TTM.
Proactive risk management
Risks might impact your TTM if not managed effectively. By identifying risks at the outset of a project you can take steps to mitigate them. This can minimize their potential impact, which can reduce delays and shorten TTM.
In some instances, outsourcing a task or tasks can speed up time to market. This is especially beneficial if the specific task is not a core competence for the outsourcer but is for the company outsourced to.
A word of warning: Remember TTM should not be the only important consideration in getting a product to market! The product released must do what it says it does and solve a customer problem. If the product released is not at least an MVP, then customers that try it out may be put off. This will be bad for brand reputation.
Tools and Technologies
Time to market technologies and tools that you might consider adopting are:
1. aPaaS solutions – application platform as a service options provide cloud-based development tools for rapid results. They include rapid application development tools and enable fast build and deployment of business applications.
2. Process flow software – this can help in mapping out workflows to see where inefficiencies are and cut them out.
3. Project management software – this is beneficial in making sure that TTM can be better managed through the careful definition of project activities and keeping track of milestone deadlines.
4. Risk management tools – to keep track of risks and ensure you are mitigating them.
Time to market is a metric that all businesses should concern themselves with. Being slow about it can seriously impact on capability to benefit from business opportunities. TTM can impact on revenues and costs, and a faster TTM can bring a competitive advantage for a firm. TTM varies by sector with the technology industry experiencing some of the fastest TTMs. There are a multitude of ways in which TTM can be shortened that organizations can try. Any product released must be viable in meeting a customer’s need and doing what it says it does, or brand reputation will be threatened. Enkonix can definitely help you with that, just contact us to discuss your idea.