Why is having a strategy the most important thing you can do when starting any business?
What is the role of market research when starting any business?
What are the key aspects to consider while making decisions on manufacturing?
What is the role of various elements in developing a great product ? Like product design, packaging etc.
Andrew Lees answers the above questions as he talks about various aspects of new product development and launch. Andrew Lees is the Founder and CEO of Stoke Ventures, Co-Founder and CEO of Maholla Products, Inc.He is also the co-host of the podcast, That Entrepreneur Life. Please listen to his podcast here
The importance of strategy before starting up
Andrew believes that strategy is so important with any business launch. He believes that market research, understanding who your competitors are, who your audience are and clearly identifying what your value proposition is mission critical. He thinks that a lot of entrepreneurs have a great idea and they just go full speed ahead with it. Often they might not understand what their product is, or their services and who their core customers are.
Andrew thinks that it is also important to put together business and financial modeling. “So you understand that the numbers work out, and that you understand what your business model really is, like, how are you going to make money? What is the model for that? And and then what is your marketing and sales strategy to connect with your target audience, to connect your value proposition with your target audience that you identified”.
Andrew believe that your strategic plan is “a living, breathing document. It’s not like, like a traditional business plan, you might put it together might be dozens of pages, or whatever.And, you know, really, the idea is just to take it to a bank and get a loan, you prove to them that you have this idea and that you’re backing it up with all this stuff. But I think even banks are probably seeing through that now. “
Andrew recommends to put a good solid strategy together and then start iterating and testing . “ I definitely recommend that people don’t get too lost in their in their business planning in the beginning, because it really comes down to testing, the more you do that, the more you’ll understand how your your business actually works, and how it how it should be structured to be successful. So you’re always testing going back to that strategy, refining it, improving it, and then and then figuring out how to take it forward.”
The need for market research before starting up
Andrew recommends the market research should be done right after you have an idea. He observes that “I see it with people, including myself, I start to run a Facebook ad on a product…sometimes I’ll realize, Wow, I actually thought I thought I knew the audience, but I didn’t know it as well as I really did.”
One of the ways to test the market out is to do a pre sale. He says “ have people either expressed some interest in your product or service by putting in their email address ? They could even put down like $1 deposit just to show even more interest in actually buying your product or service.”
The Direct to Consumer Strategy
Andrew believes that you need to build your own direct to consumer strategy besides using platforms for your go to market strategy. He believes that it is easy to launch a product on Amazon but scaling it on Amazon is really hard. He observes “You also have to make sure that you build your own sandbox. And what I mean by that is, when you’re working with these platforms, you’re at their mercy, you play by their rules…..Amazon is massive, they definitely have a built in advantage that you can list a product on Amazon today, and you may very well get sales by the end of the day. It can be very, very quick to see results, that doesn’t mean that you’re going to scale this massive business that quickly”
Andrew believes that in the long run one should definitely build one’s own website and mailing list. ” I would make sure that you’re always focused on driving traffic and sales to your own website, something that you you control, you know, that you can, if you need to make a change on the back end…. And then to take it one step further, is make sure that you are building an email list. Because that is the only thing that you have full control of “
Importance of Manufacturability
Andrew believes that manufacturability is really important for in the development process. And he think sometimes it’s a little overlooked or undervalued. He observes “right from the beginning, you’re considering manufacturability. What processes are going to be used ? Are there going to be plastic parts that are going to be injection molded ? Or metal parts that are machined or sheet metal parts ?” Andrew believes that it is important to make sure that the product that you are designing can be efficiently manufactured. He cites an example “I’ve seen some really great, really cool looking designs. And I’ll dig into the the CAD models and the design of it, the detailed design of it, and I’m like, Oh wow, this is this is cool looking!. But manufacturing it is really, really difficult”
Usability & Packaging
Andrew believes that the most important aspect of a product is that it is ‘designed for usability’ We have to make sure that it’s going to be nice and easy to use. He says that it will be great “ if there is some kind of wow factor to it, or some cool factor, like, you know, that’s worth sharing” . He says that we need to think hard and create an experience with the product that people are excited to share.
Andrew also talks about the importance of packaging. One of the trends in packaging is being able to kind of experience the product with before you buy it like “ little opening on on some blister pack packaging where you could like feel the product even you know, you could if there was like a unique texture or something to it” . It is really important to look at ways that the customer can interact with your product before they even buy it.
He also believes that ‘unboxing’ a product has to be a great experience like Apple. “ I just got a new pair of air pods. And you know, just the they just have a simple white box… but they’ve thought of every single detail in that box. It is nice and solid, you know, double, triple, quadruple walled…. they’ve gotten a fit from the top and the bottom of the box to fit so perfectly…. there’s a little pull tab to get that started so you can open up the wrapping and then get into the box and they thought of every single little detail”