The #1 Thing That Trips Up New Products

 2nd October 2018 by gihan

In the next three weeks, I’ll be speaking at conferences across many different industries – including insurance, food & beverage, surveying, manufacturing, and real estate. They all want to know how to predict what new products and services to offer their customers, so they can stay ahead of the game.

But this is the wrong goal. It’s difficult to predict what customers will want, and if you try, it’s easy to waste a lot of time and money on something they don’t want.

There’s a better way.

Let me tell you a story …

The technology company LifeBEAM, founded in 2011 by former US Air Force pilots, first built products to monitor heart rate and blood flow of pilots and astronauts, to help understand more about the physical challenges of flying. Their technology was later used by Samsung and Under Amour in their wearable products, so LifeBEAM knew there were consumer applications as well.

But when planning their own consumer product – an “artificially intelligent” personal trainer (in reality, smart headphones for helping joggers and runners) – they weren’t sure customers would like it. So, before investing millions of dollars in research and development of a product that might only generate lukewarm demand, they decided to ask customers directly whether they wanted it.

They did this using the popular crowdfunding site, Kickstarter, asking for US$100,000 of seed money to fund the initial development. The campaign swiftly reached its goal, and then exceeded it many times over, eventually ending with US$1.7 million! That made it the highest-funded campaign to date for a wearable device.

More importantly, the team at LifeBEAM knew they had a hit on their hands, and they went into full-blown production, knowing customers had voted for their product – long before they had started developing it, let alone marketing it.

Crowdfunding sites like Kickstarter and Indiegogo play an important role in providing alternative funding for  start-up companies and entrepreneurs who don’t want to go down the traditional funding path (venture capitalists, floats, and so on). There’s no doubt they have helped many small businesses launch big products.

But they also provide another valuable service: They give customers a say in which products and services they want. In the world of crowdfunding, only a few succeed, and most products fail (that is, they don’t reach their funding goal). The failures can be devastating for their founders, but it’s better to fail now rather than pumping time, money and energy into a product that fails later.

Your customers know what products they want.

You might think you know the best product or service for your customers, but do you really know? Wouldn’t it be nice to know before you invest time and money in them?

You don’t have to use a crowdfunding site, but do ask customers what they want. Give them options, and they will help you choose the best products and services.

Of course, that doesn’t mean you give customers carte blanche in every decision. In fact, there are two things you usually don’t delegate to your customers:

  • Why: You control your underlying mission, purpose, and values – and all products and services must align with these principles.
  • How: After you choose a product or service, you don’t expect your customers to have the expertise to create it.

Think of this like passengers on a bus, who choose their seats and their stop, but don’t choose the route (the why) or control the steering wheel (the how).

Even if you leave those two things aside, you still have a lot of scope to ask your customers about the “What” – in other words, what products or services will suit them best. Or, if you apply this to existing products or services, ask them what features they would like next.

Ask your customers to help you choose.

To invite your customers to help you choose the best products and services, ask yourself these three questions:

  1. What new products and services are you considering? Have you asked your customers to help you choose, prioritise, or evaluate them?
  2. Does it make sense to start by offering this only to selected customers (for example, your most loyal customers)?
  3. Can you extend this beyond your existing customers to the wider market?

Want to know more?

If you would like my help, please get in touch. In my Think Sharper masterclass and executive mentoring, we examine six different touchpoints in the customer journey where you can involve them more as partners in your business. Find out more here, or drop me a line and let’s talk about it.

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