The Process of Identifying and Launching New Products & Companies
The process of launching a new product or company is a discipline that anyone can learn and through repetition excel at. There is a method to the madness. As entrepreneurs and business owners, developing a competency in the process is one of our primary job functions. If we want our respective companies to grow and withstand the tests of time, we must systematically build this discipline into our organizations.
There are two approaches to launching new products and companies. The first approach identifies an idea, validates the idea through market research, and then creates a business plan to make the idea a reality. The entire process is “idea centric.” The second approach (the one smbZen favors), begins with self-awareness. It asks: (a) what are our, or our company’s traits and abilities, (b) our combined expertise and training, (c) who do we collectively know, and (d) as a consequence of these three questions, what can we do? This approach is entirely “people-centric.”
The Bass Model & Forecasting Product Adoption (Part I)
Market Sizing & Analogous Products
In the previous post, we mentioned the difficulty of conducting market research for truly novel products and services. But what about those that can be compared with things that already exist? If years ago, you wanted to say introduce the iPod, a product that could, in some respects be compared with other portable music players, establishing market size wouldn’t be an entirely subjective a task. A quick literature search for the market size of analogous products such as portable radios, walkmans, and CD players, could have provided baseline figures.
The Bass Model
Beyond the support it lends to fund raising activities, defensible market size information is also and important business planning tool. Market size information is one of the key metrics used in “the Bass Model,” a highly cited model for forecasting the adoption of new products and services. Hey, if you are planning to sell a tangible good or even a subscription-based web service, you simply have to graph the adoption curve to project revenues and expenses, and to determine what resources will be needed.
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