Thursday, February 14, 2013
Which Comes First - the Product or the Market?
Too many toys to choose from! (Ethan in a shop in Shibuya, Tokyo)
You're all fired up and rarin' to go.
After slaving away for goodness knows how long, you've perfected your recipe for world domination. You've got it all worked out - product range, features, price point, packaging, advertising campaign, suppliers, distributors, retail outlet, the works.
Nobody knows this product as well as you do. After all, you ate, breathed and lived this idea for the past few years.
You've participated in all the courses, received all the certificates, and heck, was even rewarded with a generous prize for being the best _____ in a recent contest.
All this while, you've kept your dream alive while enduring the demands and rigours of a nine to five job.
The stars are aligned. Your product is a work of art. Nothing can possibly go wrong.
It is time for you to break free and be an entrepreneur!
But wait! Chotto matte!
There is one missing piece that you haven't quite figured out. It is the most important reason for anybody to go into a business of his or her own.
One which determines the survival (or death) of a million small businesses.
Is there a market for what you're offering?
In other words, is there a critical gap, common frustration, unfulfilled dream, or hidden opportunity that you're resolving? Is there a niche that you (and hopefully only you) can meet - one that is ignored by the current marketplace?
After all, the world doesn't really need yet another boutique, bakery, buffet line, or brass band. Well, at least one that tastes, looks and sounds just like the rest.
Unfortunately, the challenge is in discerning these latent needs, wants and desires.
Just look at Apple. Nobody could articulate that they wanted a mobile phone with a screen that functioned like an iPod. Yet, when the iPhone was launched, its sales broke all previous records.
And the rest, as they say, is history.
However, not all of us can be like Steve Jobs. Few can discern the hidden potential of new products as accurately as that giant of a man (may he rest in peace).
What should one do then?
For a start, make it a point to talk to people, particularly those whom you see as your potential customers.
Prompt them to share what their problems, challenges, and issues are. Is there something that they wished they could do but couldn't find the wherewithal to accomplish? What are their most common pain points or their greatest complaints?
Alternatively, you can build your business around the wishes and desires of others. Encourage your potential customers to imagine what they would dearly love to have. How would their ideal world look like? What services or products would such an utopian society have?
Once you've collected enough data, develop a value proposition for your business that can accomplish two things:
1) Solve/fulfill the greatest nagging ills/unmet dreams of your target customers;
2) Match your interests, resources, competencies and aptitudes. While a cure for AIDS is probably one of the world's most pressing need, few have the means or know how to launch a business in that area.
Of course, starting a business also requires multiple other factors to be considered. These include funding, manpower, distribution networks, shop locations, and so on and so forth.
There are also government regulations to consider, suppliers to negotiate with, distributors to please, and technical specifications to meet.
However, the first and perhaps most important step in entrepreneurship is to meet a latent customer demand with a product, service or experience that provides exceptional utility. Carve out a niche that is unique and valued by your customers, fits your interests and passions to a T, and is poorly met/ unmet by competitors in the marketplace.
Do you agree that the market should be established before the product?