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Product 101 – getting the basics right

Posted on 24/1/2018 by Tom Holmes

When you start life as a business, there are numerous challenges. But, says Nutbourne’s Marcus Evans, the most common one he sees is to do with the product or service a company is selling.

“You tend to get two types of people starting new companies. Either they have a brilliant product but don’t know how to market it, or you get the type that is great at sales, marketing and pushing it, but who has a lousy product.

“Bridging the gap takes a lot of experience. But, if you know the product well enough, you can do most of the work yourself.”

 Here’s what Marcus suggests…

 Know the landscape:

 Broadly speaking, your product or service will fall into one of two areas:

 1 - The product or service isn’t revolutionary

You enter an established market that has tried and tested products. In this instance, your customers know what you are selling and will need little education.

 2 -  You develop a product or service that has no existing market… yet

“It’s hard to make a market from scratch,” Marcus says. “Tablets are the best example of this most recently, though they were able to piggyback on mobile phones and laptops. People understood the process of a tablet, even if they didn’t need one before.”

If you come up with a new product that requires educating the target market before you can sell, that’s a further challenge. It does, however, allow you to be the unicorn company that everyone wants to have – i.e. it grows exponentially and is valued far more than what it’s ever achieved.

Be specific:

“Your product or service has to be clearly defined. If you can’t get across to someone what you’re selling, why would they buy it?” Marcus adds.

“This is true of both scenarios outlined above. If you are in a crowded marketplace, you will need to differentiate your product, most likely on feature or price. If you are in a new market, your customers will need educating about the type of product and what need it fulfils.”

Define what you are selling on too. Is it features, quality of service or price?

Be flexible but be cautious too:

A lot of companies start life by selling one product and then move on to sell another. In fact, this is true of around 30% of companies.

This often occurs because an opportunity presents itself or because the company fails to initially establish a profitable revenue stream before finding what works – think Apple in the late 90s before Steve Jobs returned.

While this approach has worked for the likes of Nintendo, Google and PayPal, Marcus urges caution. “Diversifying too much means you have no apparent hook into the market.  People will then see you as jack-of-all-trades and question what you do well.

“This is why point two is so important. You need to be able to define your product or service and get it across to people to be able to fulfil that need that they have – which they hopefully know that they have.

“If you know your core offering, then you are half way to being able to sell it.”    

Posted in Business

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