Product Development and Investors
Take a look at a couple of key areas that you don’t want to forget as you develop your product and pitch your company to potential investors. Product development is the process by which your product goes from an idea to a product that customers can purchase.
Product development includes obvious aspects, such as designing, including the behind-the-scenes thought that goes into an ingenious design; testing, which also involves customer testing to make sure that the product works as expected; prototyping; manufacturing; packaging; launching the product; and the development of the sales channels that will make the product a hit.
Vetting your product
Inventors are experts of idea creation. A single inventor can churn out a new product every year, and even more if he or she gets outside funding. Many inventors are great at designing the product to serve a unique purpose, and to that end, they perform product testing to ensure that what they’ve created truly solves the problem that they set out to solve.
It’s important for inventors to undergo a reality check before setting out on the next invention.
What problem does it solve?
How many people or businesses will buy this invention?
Does the customer actually have money available to buy the product?
Is the customer bothered enough to change her habits and start buying a new product?
Many inventors never go through this reality check and wonder why their products languish on shelves. It’s not enough to design, create, manufacture, patent, and label a product. Truly successful product development includes a great deal of analysis on the potential customer.
An example of an uninspiring customer might be an underprivileged teen in the inner city. Yes, that individual has a great deal of problems in her life, and many might be solved with new inventions or products, but she doesn’t have the available cash to purchase the product.
Another bad customer is a medical office. Sure, it may have a large budget, but doctors are notoriously difficult to sell to. They tend to adhere to their habits and are unwilling to change their behaviors quickly.
Get customer input during product development
Investors want to understand how strong the need is for the new product, and one of the questions they’ll ask is how big is the pain that your product will relieve. How big is the problem you are trying to solve? Investors are most interested in products that can demonstrate that they save customers so much pain, money, or time that buying the product is a no-brainer.
In other words, you must be able to demonstrate that your product solves a problem in a way that people want. That’s where customer input comes in. During product development, you want to elicit customer input. Your customers can tell you things like the current solution is too expensive or too time consuming. They can let you know when an otherwise little detail (color, flavor, sound) is unacceptable.
Connecting with your customers throughout the product development cycle saves you time and money in the long run. You may think your customers are clueless, but if you aren’t talking to them upfront (and listening), you aren’t going to sell to them at the end.
The founders of Field Square initially thought that their customers needed an app to record patient data during medical house calls made by nurses. After six months of talking to nurses, plumbers, used car salesman, and others, they realized that the value of their product was actually in documenting the miles driven and hour-by-hour whereabouts of a company’s field workers.
They were able to build out the mobile positioning features of their iPad App product while still in development and therefore create appeal to a much larger customer base.
Your product will change between its initial prototype and when it’s first sold. Your product may change again in the first and second years of sales. Little changes in product design are much easier than big changes, which can set your product development phase back significantly.
By being open to changes along the way, you can make changes to your product as you learn more about what the customer wants. Although large changes are inevitable in some companies, keeping an open mind and ear about what your customer wants reduces the likelihood that you’ll be saddled with large changes.