Some new products are destined for success. When we see the product for the first time, we have a “why didn’t I think of that?” reaction. We’re impressed at the obvious solution to a common problem and how valuable we perceive the product to be.
What makes customers line up for some new products? The answer always comes back to the customer. People buy products or services that solve a problem. To understand the customer’s motivation behind a purchase, watch how the problem materializes in the real world. You might experience it yourself or observe others challenged by their situation. Either way, lived experience is the genesis of any new product.
An original idea for a successful product can come from a variety of sources. Here are a few sources that I’ve seen with my clients over the past few decades.
Great ideas tend to come during fleeting moments of insight. One of your employees may see a customer frustrated with a situation and think of something that would have helped that customer.
The challenge is to get employees to take ownership of the idea and run with it. This concept has come to be known as intrapreneurship – when employees act like entrepreneurs.
Technology companies offer wonderful examples for channeling ideas from employees. Amazon’s internal website contains a virtual idea box where employees can submit concepts for new products or services. One employee suggested free shipping, which became the successful Amazon Prime program. Other companies, such as Google and the stock photo company Shutterstock, set aside specific days for staff to work on new product ideas and present their ideas in a competition-style format similar to the television show Dragon’s Den. The goal is to encourage creativity, innovation, and collaboration.
Whatever process you use, make sure to create a culture that encourages innovation, regardless of whether every idea becomes a successful product. Intuit, the software company that owns QuickBooks, annually holds a company-wide award ceremony and presents an employee with the “failure award” for the unsuccessful product that provided the most valuable lesson.
Failed research and development projects can be a wonderful source of product ideas. One famous example is Post-it Notes. Scientists were trying to develop a super-strong glue for aircraft
construction. They failed, and accidentally developed an adhesive that would not stick. There’s not much of a market for an adhesive that won’t stick so the technology was abandoned. The technology was later repurposed for Post-it Notes and the product is in most offices today.
When you’re wandering through the research and development graveyard, the key is to think about customer problems rather than the technology. The Post-it Note emerged when one of the scientists who knew about the not-very-sticky adhesive had problems with his hymn notes falling out of his church songbook.
Failure exists in any business. Creating a company culture that nurtures the ability to manage risks, learn from mistakes, adjust, and improve is key to high performance.
To learn how to create and maintain this culture, download the discussion paper Building Off Failures by Banda Marketing Group.
Steve Jobs often worked in his own call centre speaking directly with customers who phoned Apple Computer for technical support. He would not tell people who he was, but he’d work with these users to solve their problems. He gained a deep understanding of how people use the company’s products, the problems they were having, and improvements that would make their lives easier. It’s a form of market research.
In a 1997 interview, Jobs said, “You have to start with the customer experience and work backwards to the technology.” This customer focus comes from a person who is arguably the most revered product-centric entrepreneur in modern history.
Kids see the world without a preconceived bias about what is possible. They ask questions that can highlight opportunities that others do not see.
Great products have been developed from a child’s observations. Sometimes, the kids themselves are the entrepreneurs. One of my favourite examples is an 11-year old boy on vacation in Hawaii who was frustrated that he could not talk with his dad about the beautiful things they saw while swimming underwater. He then started researching underwater acoustics, developed prototypes, and invented the Water Talkie, which allowed him to talk to other swimmers up to 15 feet away. He pitched his idea to Toys “R” Us and walked out with an order for 50,000 units.
Consider who has a line of sight into the customer’s situation and who understands the customer’s problem.
Suppliers work with their product or service every day, so they typically have a narrow view of their technology (e.g., chemical manufacturing). They also work with your competitors and have a broad view of the industry (e.g., coatings for consumer packaged products). They answer questions, discuss growth plans with a variety of their customers, and see industry trends unfold. They have insight into what consumers may need.
A partnership-style supplier relationship with a high degree of trust and interdependency will naturally lend itself to a “what-if” discussion in which you talk about trends, the needs of the end user,
and ways you can work together to solve a problem. Your focus must be on improving profit for both your company and your supplier rather than just managing the costs of a transaction. Some companies include this consumer-focused perspective directly in their culture of working with suppliers. L’Oreal holds a conference with suppliers of its cosmetics products to share consumer
insights and ensure suppliers understand the products L’Oreal will need in the future.
Sometimes a person’s frustration in their own life can lead to an idea for innovation. The interesting thing is that this is almost always not a new insight. Much of the population may have similar frustrations, but it takes a creative mind and entrepreneurial instinct to solve the problem. Sometimes that solution materializes as a new product, and other times it’s as a new business model.
In 2011, two friends discussed how frustrated they were with the high price and inconvenience of purchasing disposable razors. The barriers to entry when competing with multinationals such
as Gillette and Schick are significant, and the market had low competition despite the frustration of consumers. It was ripe for someone to turn the industry on its head. The friends launched their own brand of razors, named Harry’s. Consumers purchase this product online directly from the manufacturer and can sign up to receive regular shipments of replacement razor cartridges by mail. The company now has a foothold in the market with over US$100 million in revenue.
The core idea for your product must stem from your understanding of the customer. Consider who has a line of sight into the customer’s situation and who understands the customer’s problem. Maybe it’s you, your employee, or your supplier. Start with the customer experience and you are more likely to hear someone say, “Why didn’t I think of that idea first?”
First published in the December 2018 edition of The Business Advisor.