1.8 Selecting Products, Customers, and Competitors

How Do I Come up with a Killer Product Idea?

"How do I come up with a killer product idea?" is a question that gets asked frequently. Thinking as an everyday consumer, we usually struggle with identifying innovative product ideas. Henry Ford said, "If I'd asked my customers what they wanted, they'd have said a faster horse." Fortunately for us, Henry Ford did not think like a consumer, he thought like a marketer. He asked, "What problem are people buying this horse to solve?" and answered himself that people needed a quicker, more convenient, more comfortable way to get from Point A to Point B. Then, he knew that the automobile would be a killer product! Similarly, Charles Schwab built his innovative investment business by asking the question, "I know it is not possible, but wouldn't it be nice if you could do…?" Both Ford and Schwab built successful businesses by addressing current problems rather than limiting their focus to current products. Having an eye for pain and problems is what it means to "think" like a marketer, and perhaps why real marketers never seem to have a shortage of good ideas. If consumers have a pain or a problem, then marketers have got a product or service for them.

Focus on Solving Customers' Problem

Harvard Business School Professor Clayton Christensen emphasizes this point, “Many products fail because companies develop them from the wrong perspective. Companies focus too much on what they want to sell their customers, rather than…what problems customers are trying to solve.”

When it comes to identifying "killer" product ideas, remember that being a good observer is just as important as asking the right questions and being a good listener. Find pain by observing frustration firsthand. The wildly successful Southwest Airlines was born out of firsthand observations of the pain experienced by business travelers waiting for late flights, left stranded by canceled flights, and joining center-seat-only full flights. Of course, sometimes great product ideas just hit us. Paul McCartney's song "Yesterday" was voted as the #1 pop song of all time. So the story goes, Paul woke up one morning and immediately started playing the melody for "Yesterday" that he had dreamed the night before. As McCartney explained, "For a month I went round to people in the music business and asked them whether they had ever heard it before. Eventually it became like handing something to the police. I thought if no one claimed it after a few weeks then I could have it."

Chase Customers, Not Competitors

To achieve breakthrough success, marketers must carve out a new space in the market, redraw the competitive map, and perhaps rethink what they know about marketing. To be specific, chasing customers and not competitors is at the very core of achieving success. Marketers often face a David and Goliath competitive environment. Established competitors have more of everything: more money, more marketplace experience, more name recognition, more distribution, and more customers. The Goliath wields so much power as to even set the benchmark for what customers believe they need and want in terms of product features and benefits. Goliath defines the competitive landscape, chooses the weapons, and picks the battles in a way that plays to their strength. In such a world, how is David supposed to compete, much less win? Certainly, David will not succeed by playing the same game as Goliath. David needs to play to his own unique set of strengths, even if the casual onlooker is initially unimpressed. To win, David chases customers and not competitors. That is, David addresses customer pain rather than benchmarking and copying bigger, more successful competitors.

A David-and-Goliath Example: Canon and Xerox

Consider the case study of Xerox, a true Goliath, and Canon, an upstart David. Xerox dominated business copying. It was commonplace to go into the centralized copy room before a big meeting needing copies of a presentation, waiting in line, and then having the big Xerox copy machine break down halfway through the project. To anyone caring to notice, it seemed like there was some vulnerability to exploit, and companies such as IBM and Kodak tried to do it. They built Xerox-style big copiers of their own and went toe-to-toe with Xerox. But Xerox was, after all, the Goliath, and easily handled everything IBM and Kodak sent their way. IBM and Kodak just couldn't beat Xerox at the centralized copier game. If someone was going to defeat Goliath, they needed to find something new and different to offer. They needed to identify a copier product that addressed unaddressed pain.

Along came Canon, just a little David in the copier market with little toy-like copiers. Xerox executives and engineers laughed at Canon's pathetic product offerings. After all, Canon was not even competing for the centralized copier business. Canon was pushing something called distributed copying. That is, small copiers distributed to individual offices and departments that were highly reliable and available for making copies when you really needed them, just before the big meeting. Sure, in the early days, the copy speed and quality produced by Canon wasn't as good as the big Xerox, but the speed and quality were more than adequate for the frontline user. Canon educated office managers and frontline users on the advantages of their little copiers, bypassing the traditional purchasing department selling channel that was locked up by Xerox. Frontline users educated their bosses and the bosses authorized purchases. People stopped using the big Xerox, except when quality really mattered and time really didn't. The sales of Xerox consumables like paper, toner, and service declined dramatically. Canon changed the rules of the game, and Xerox was brought to its knees, taking a decade to recover. Xerox, as the Goliath, had many advantages, but one deadly disadvantage. Like all well-known brands, Xerox had a well-defined way of doing business that it could not walk away from. Xerox was trapped by its own success. Marketers with new products don't carry baggage. They have the freedom to compete and win by following their own path to success and building on their unique customer-must-have qualities.

Raising the Relevance Bar

Anyone who has ever been around teenagers knows that you can't convince a teenager that something is relevant or important just by saying that it is! Raising the relevance bar for customers requires real ingenuity. Playing to strength is one thing, but making that strength important to a customer demands that we develop a knack for recognizing pain and learning how to make connections between our unique solution for that pain and the human emotions that energize our lives. Said another way, we have to connect product, solution for pain, and person. Products struggle when they don't find a way of making the right emotional connection with people.

Segway Scooter

For example, let's say that you have invested big money in developing an electrically powered, self-balancing, computer-controlled two-wheeled vehicle on which people can stand up and ride. There has never been a vehicle quite like it. It is so revolutionary that no one can even figure out what to call it. After a naming contest, you name it the Segway Scooter. In the first year, you plan on selling between 50,000 and 100,000 vehicles. However, over the first 21 months, you sell only about 6,000. People's emotional reactions to the scooter are mixed. It looks cool and futuristic. Users say that people always stop you and want to talk about it. On the other hand, people often feel foolish when riding it, and after President George Bush's well-publicized fall from a Segway, they feel a little uncertain about their personal safety. So with the Segway, the revolutionary $5,000 commuter vehicle, what do we have? It is a vehicle that attracts the sort of attention that slows you down, makes you feel conspicuous and foolish, and raises concerns about personal safety. With commuters, the Segway makes an emotional connection, but not a very positive one! For most commuters, it may create more pain than it solves.

On the other hand, there must be a way for the Segway to solve some pain and make a positive emotional connection. For the trained rider, they are fast, maneuverable, reduce personal fatigue, and put you head and shoulders above the crowd. Who gets an emotional bang out of these sorts of product features and benefits? Would you believe the police? Segways were put in full service by police officers patrolling Chicago's O'Hare International Airport and shortly after adopted by the German police. Officers are thrilled because the Segway enables them to do more of what they enjoy about their jobs: being visible, finding lost children, addressing security threats, and quickly covering large distances without arousing suspicion or concern. Running police officers freak people out, whereas two officers riding Segways only attract glances of admiration and interest. Riding Segways gives the police at O'Hare Airport feelings of efficiency, productivity, confidence, and accomplishment. Now, that is a positive emotional connection!

Understanding customer pain, values, and how they connect with product features and benefits can go a long way in making product offerings relevant, important, and successful. Sometimes, we need to find a new set of customers in order to make the right emotional connection. Sometimes, we just need to understand a little bit more about the pain of our current customers.

Pucker up with Lip Balm on a Leash

When brothers Brady and Jeff Anderton, avid skiers, wake boarders, mountain bikers, and hikers discovered that their family, friends, and neighbors frequently lost their lip balm, they came up with a better idea to solve pain. Why not put the lip balm on a leash? Leashes help us keep track of dogs and car keys. They may work for lip balm. Out of this thinking, Chap-Grip® Lip Balm and Leashables® were born. No more chapped and sore lips because you can't find your lip balm. With Chap-Grip® you can clip it to almost anything--belt loop, key ring, jacket zipper. No more dry, painful lips thanks to a better idea that is personally relevant to customers.

Superoots Air-Pot Gets to the Root of the Problem:

Growing trees in containers is becoming quite common, as more tree growers are converting from field-growing to container-growing every year. A major concern with this method of growing trees is the potential for root circling. The flat surfaces in traditional rigid containers and pots deflect tree roots, which can start the spiraling process. This is particularly troublesome for growers of difficult species that simply do not do well in a rigid container, and for growers who suffer losses caused by heat in the summer or cold and wet in the winter. As the tree grows, these circling patterns may cause permanent damage to the root system, affecting the overall health of the tree. Trees with circling roots do not anchor well in the ground. Such trees may blow over or simply fall over. Trees with circling roots are not efficient at absorbing nutrients. Malnourished trees are highly susceptible to disease. Trees with circling roots may die as the spiraling roots eventually choke the tree. This big pain for tree growers led to a big opportunity for ISA Certified Arborist Ben Walker and his son Brandt of Canby, Oregon. Ben and Brandt discovered a unique growing container from the Caledonian Tree Company of Edinburgh, Scotland. The unique container, called the Superoots Air-Pot, uses air to keep tree roots from circling as they mature. Tree roots grow toward holes in the sides of the pot. Once they reach the air hole, roots stop growing. This air-pruning technology eliminates circling roots as well as increases root development. The tree then sends out new roots. As this process continues, the tree develops a strong, straight root system. Benefits to the garden centers and nurseries include healthier trees and extended shelf life. For tree and shrub buyers, the fibrous, white-tipped roots grow better when transplanted. Ben and Brandt purchased a license for the Superoots Air-Pot and then created the SuperTrees brand of trees. Combining the Air-Pot containers from Scotland with the productive tree-growing environment of the Willamette Valley in Oregon, Ben and Brandt are proving that better roots grow better trees. Today, they supply SuperTrees brand trees to most of the western United States and they are growing!

Climb to the Top with a Better Ladder

How do you make a better ladder? Over 30 years ago, Hal Wing discovered a remarkable German inventor, Walter Kummerlin, who invented an all-in-one articulated ladder. At the time, Hal and Walter were neighbors in Germany. Hal immediately recognized that this innovative ladder could take the place of several ordinary ladders. It could be the "Swiss Army Knife" of ladders. In 1972, he started importing these ladders from Germany. When Hal encountered problems with supply and exchange rate fluctuations, he decided to upgrade the original German ladder design, improve fabrication techniques, and make the ladder in the United States. The result is the Little Giant, an adjustable ladder system that offers the versatility of 24 ladders in one. Even with price points three to four times higher than an ordinary A-frame ladder, the Little Giant sells millions because the adaptable design eliminates the need for multiple ladders and is safe and reliable. Little Giant is selling more than a ladder: they are selling a lifetime of safety. When the company hired Dean Johnson and Robin Hartl of the syndicated home-improvement show Hometime to host an infomercial, sales skyrocketed. The company managed to keep pace with demand by manufacturing 24/7. Revenues first sextupled and then increased another 40% in the following year. The company now grosses in nine figures. Today, Wing Enterprises holds worldwide patents and trademarks on many innovations in ladder design and manufacturing. The company is the largest manufacturer of American-made ladders.