How to Differentiate a New Product Starts with Knowing Your Customer

I once knew an entrepreneur who loved basketball. In his professional life, he was a doctor. He put the two together when he developed a shoe that prevented ankle sprains. He did his homework and found that ankle sprains were the #1 basketball injury and there was a multibillion-dollar market for basketball shoes. It was not until he had 26,000 pairs sitting in a warehouse, and he had spent a lot of raised money on marketing, that he realized this was not going to fly.

Another inventive soul who was in the printing business learned that the nose of dogs was as unique as the fingerprint of a human and conjured a dog nose print product as an identifier for lost pets. It was a fabulous, noninvasive idea that bypassed injecting a chip into a dog. But what he did not consider was that for his nose print to be a valuable identifier, he also needed to create a national database as the place to look for a lost dog. He had already gone into production, spent money on packaging and thought he was ready to go.

Both entrepreneurs lost their shirts, so to speak, and it was because they did not consider the end customer before they spent money and time creating their product.

Most products and services in the world are created by someone who is passionate about solving a personal problem. Often, products emerge from those who were doing something else in their careers when an idea popped into their head, and they were courageous enough to actually do something about it. However, so many products are created without a thought about the end user.

An idea is only as good as a customer who not only wants it -- but will pay for it. Otherwise, it will die a sad death, and someone will have exuberantly spent time and money on something that never sees the light of day.

Don’t be that person.

Sometimes products have customers who would want them, but they are so expensive to produce that they will never sell.

Other times, entrepreneurs create something that appears to have a large market opportunity, but they cannot compete or missed an important psychographic about their customer.

In the case of the basketball shoe company, there was a huge market for basketball shoes, but those brand-conscious 12–16-year-olds he found in his research who were buying 5-7 pairs of shoes a year, were literally killing for name brand sneakers only. Nike and Adidas had tied up contracts with every level of basketball from the high schooler AAU to the NBA, so would-be ambassadors were contractually not able to put anything on their feet other than Nike and Adidas; no matter how many ankle sprains they endured.

Some entrepreneurs see a market or a trend first and attempt to compete .

I call these copycat products. Sadly ,so many spend a lifetime thrashing about in a bloody red ocean (reference to one of my favorite books: “Blue Ocean Strategy” by W. Chan Kim and Renée Mauborgne). Without a truly meaningful differentiation, they get nowhere. ?I hate to see so many products like this and entrepreneurs so infatuated with their concept, that they are blinded to what should be driving them, which is the customer.

No product will ever become a success without a customer. No business is a business without a customer; it matters not how great the product.

If you are going to attempt to compete in a trending sector, you need to think long and hard about how you will differentiate. Get serious and highly creative about this. And news flash: a “new fragrance,” “cheaper,” “faster,” or “great customer service” are not differentiators.

Sometimes that differentiator is simply the packaging. This is typical in the beauty and the tequila business. What’s inside is usually not that different, but what it looks like on the outside is what customers will remember. When you are competing in a highly saturated category like this; incredible packaging is the way to go. And I mean it better be eye-poppingly cool, gorgeous, or interesting.

Here is an example: the cannabis industry is red hot right now. There are gazillions of products out there that use these ingredients for skincare, foods, sports and spa applications, and recreational use. ?Many entrepreneurs have come to our doorstep showing yet another marijuana leaf-emblazoned badly executed package. ?We usually turn them down because we cannot market something like that; we will surely fail.

For a sector like cannabis, there is just too much competition out there; I think that your packaging or marketing has to be dazzling.

Another way to compete, as did a company called Doist, is to create a unique delivery system and an incredibly attractive packaging. Doist created a dose-controlled?cannabis?therapy line delivered in a proprietary precision?delivery system. Their tagline is “Targeted Formulas, Precise Dosage.” Each package is a super clean, white-sleeved box with lots of elegant whitespace simply labeled, “sleep,” “bliss,” “calm,” “arouse.” The box slides open, to reveal a solid-colored carrier, each one that differentiates its contents; calming blue for sleep, hot magenta for arouse. ?

I think they did an incredible job.

Then, they took it a step farther by marketing it to lovers of aesthetics. I saw ads for Doist in Architectural Digest, not a place where one might see such a product. They knew their customer was someone who appreciated something beautiful.

I have so many other stories to tell on this subject, but I will leave this here by ending with a plea; do not spend another dime or moment creating a product until you are superlatively clear on who your customer is, why they would want to buy and how much they would pay for it. Only then, move forward with your prototypes, sourcing and finally distribution and marketing.

Ideas are only ideas, without this intel.

Do the thing that honors your good idea, do not be so in love with your concept that you cannot adjust to fit the only thing that matters: the customer.

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