Percent of Revenue from New Products (2024)

Every company nowadays is adding new products to its arsenal to increase its revenue. However, seeing a chart of the sales after adding the new products will be sufficient to get a view over what you’re doing. You can also calculate and receive a number for that exact product at any given time. There’s no period when you should calculate this, but experts say that a rough calculation can be made from one week to the other.

Percent of Revenue from New Products

Calculating the revenue percentage is done simply by dividing your total revenue by the revenue from the new products. Simple as that, you get the number you were looking for. So, the formula should look like this: Revenue from new products / Total revenue = perfect of revenue from the new products.

The sales team, when they have the result, can compare with how much the revenue has increased after the addition of the new products. However, the definition of “new product” is not always understood – so let’s take a look below and see the do’s and don’ts.

Overview of the Revenue from New Products

Repackaging a product does not automatically mean there is a new product inside the box. You think that is impossible, right? But that could happen even in well-known companies and sales teams will be confused in these stages. So make sure that you have everything sorted out before you name your product as “new”.

If the new products do not contribute to your revenue with at least 30%, as some market researchers say, then your company could be on the brink of collapse. If the company is still doing great and is not near to be collapsing, then it may look good – but it can also mean that it’s becoming irrelevant on the market. And that could be a huge problem. If you’re a company that deals with tech products, then this problem will be all too familiar to you.

Measuring your goals and establishing some boundaries in the company’s products will be a lifesaver. Don’t go too much or too less. Also, having your objectives well sorted out is the first step you should take. Another market analysis is welcome when you are preparing to release a new product on the market.

Some salespersons prefer to introduce the new products into new markets or simply just all products into new markets. Basically, the second strategy is not about a new product, but the customers will perceive the product like being new. This also can increase your revenue – but just slightly, as some experts say. Also, you should figure out if these strategies are short, mid, or long-term strategies.

To conclude with, everybody is attracted by the new and the intriguing. But as a company, the new and the intriguing come with a price if you cannot make the difference between new and just slightly modified. Also, gaining revenue may be simple if you know the marketing tricks. Even getting a product into a new market could attract customers, leads and increase the sales pipeline.