7 value attributes of your product

December 5, 2011 Leave a comment

Breakthrough products are driven by a complex combination of value attributes that connect with people’s lifestyles. If you are conceiving a new product, you must conduct a value opportunity analysis that evaluates the current state of products against seven major attributes of value, in the market where the new product requires significant improvement. This is an essential step in any new product development. Failure to thoroughly and thoughtfully complete this phase will have a negative impact down the line.

During the period of mass marketing, good value was based on the lowest cost-maximum features combination. The goal was to keep cost low, profits moderate, and sell in mass quantities (like Big Bazaar, K-mart etc). Value in its true sense, however, is lifestyle-driven, not cost-driven. So a product is valuable if it is useful, usable, and desirable. While cost is still an issue in the times of market segmentation, the more powerful factor is the consumer’s need to connect their product purchases with their own personal values. The higher a product’s perceived value, the more people will pay for it.

The seven attributes that adds value to any product are,

  1. Aesthetics that builds a positive association with the product.
  • Visual appeal
  • Products must be tactile
  • Elimination of all undesired sounds from the product
  • Agreeable smell
  1. Emotion that a consumer experiences with the product. There can be several emotions that a product can bring about, and they key ones are,
  • The product promotes excitement and adventure
  • Freedom from constraints
  • Feeling of safety and stability
  • Luxurious experience
  • User’s self-assurance about handling the product
  • Feeling of supremacy
  1. Ergonomics of your product that chiefly focuses on ‘ease of use’, ‘safety’, and ‘comfort’ of your target customers.
  2. Impact of your product through phases of development to end use. You should target your product for improving the social well-being of the stakeholders. Take care of negative environmental effect that your product might create, through green design that focuses on minimizing negative impacts on the environment due to manufacturing, resource use and recycling.
  3. Product Identity that also supports your brand identity. Your product should have the ability to fit among yet differentiate itself from its direct competition. Your product should also have a connection with the rest of the products produced by your start-up. Your product must be designed to fit into the context of use.
  4. Quality in the precision and accuracy of manufacturing process, material composition, and methods of attachment. Your product should be made with sufficient tolerances to meet performance expectations over time, and must hold up to the expected life of the product.
  5. Technology alone is not enough, but technology is essential. Your core technology must be appropriately advanced to provide sufficient features to your product. Remember, consumers expect technology in products to work consistently and at high level of performance over time.

Keep in mind while working on a new product that it should be aimed at fulfilling a fantasy by facilitating a more enjoyable way of doing something.

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Economics of your startup

December 5, 2011 Leave a comment

Usually entrepreneurs describe their products & services as they see them. It’s important to describe them from your customers’ point of view. Look the difference between features and benefits of your product/service, and think about them. You need to build features into your product so that you can sell the benefits. You also need to think hard and strategize on what after-sale services you will be giving? Some examples can be delivery, guarantee/warranty, service contracts, support, follow-up, and refund policy.

Customers

Identify your targeted customers, their characteristics, and their demographics. The description will be completely different depending on whether you plan to sell directly to customers/end users or to other businesses. If you are planning to sell a consumer product, but want to do it through a channel of distributors, wholesalers, and retailers, you must carefully analyze both the end consumer and the middleman businesses to which you will sell.

Competition

You need to think and carefully answer the following questions for your startups. What products and companies will compete with you? Will they compete with you across the board, or just for certain products, certain customers, or in certain locations? Will you have important indirect competitors? How will your products or services compare with the competition?

You need to honestly think about your product/service weaknesses. Sometimes it is hard to analyze our own weaknesses. Better yet, get some disinterested strangers to assess you. This can be a real eye-opener. And remember that you cannot be all things to all people. In fact, trying to be causes many business failures because efforts become scattered and diluted. You want an honest assessment of your startup’s strong and weak points.

Niche & Strategy

Now that you have systematically analyzed your industry, your product, your customers, and the competition, you should have a clear picture of where your company fits into the world. Consistent with your niche, you can outline a strategy for your startup.

Pricing

Develop your method of setting prices for your product/service. Does your pricing strategy fit with what was revealed in your competitive analysis? For most startups, having the lowest price is not a good policy. It robs you of needed profit margin; customers may not care as much about price as you think; and large competitors can under price you anyway. Usually you will do better to have average prices and compete on quality and service.

Sales Forecast

After you have laid down comprehensive information and plan for your startup in detail, it’s time to attach some numbers to your idea and prepare your sales forecast.  You may want to do two forecasts: 1) a “best guess”, which is what you really expect, and 2) a “worst case” low estimate that you are confident you can reach no matter what happens.

Do keep visiting our Blog for a specific post on Sales Forecast and a Free spreadsheet.

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Product Strategy

October 28, 2010 1 Comment

A successful product must connect with the personal values of targeted customers. A product experience includes the expression of the product and the interaction with the product. The three main ingredient of any product are, 

  1.  Usefulness of the product that enhance or ease some activity or process
  2.  The product is easy to use and remains consistent in use throughout its expected life
  3.  Desirability of the product.  

Read the full article here

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Pricing Strategy for your Startup

October 27, 2010 2 Comments

Pricing your products/services is not only a key to your sales success but also for the health of your Startup.  Both high and low prices than optimum will hurt your business. High prices in the beginning may throw you out of the game, and low prices will cost you more. So you must charge enough to make a profit while being in the game. A well thought-out pricing strategy takes some effort but is worth the time spent.

Read the full article at: http://www.stratessence.com/blog/pricing-strategy-for-your-startup/

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