Let’s talk about product development for a minute.
Have you ever heard the expression, “If you build it, they will come?” That might work in baseball, but it’s a bad philosophy for product development.
If you build a new offering based on what you want to do, you have no way to know whether there is a profitable market for it.
Instead of starting from the inside, building a product and then trying to sell it, here are 3 ideas for product development from the outside in.
1. Look to existing customers for product development ideas.
The first step of product development from the outside in is looking to your existing customers for ideas. Here are some questions to ask:
- What do customers complain about?
- What do customers ask for?
- Are there problems we aren’t solving?
- What adjacent services are we not providing?
You may identify gaps in your offering that you can fill with new products and services, or by improving your current offering.
Regardless, your customers are a great place to start. It’s easier to sell more things to your current customers than to generate a new customer base for your new offerings.
You may end up with some ideas that are pretty far out of the box. For example, we know of a wealth management company that got involved in coordinating private aviation for its clients. They found a need, fit it into their strategy, and significantly improved their client experience.
2. Engage your salespeople in product development.
Your salespeople should have a finger on the pulse of your market, and they should be staying on top of trends. How can they contribute to product development?
If you want to get ahead of your customers and develop products they will need in the future, you need to stay connected to your industry. Leverage your sales team’s relationships to help.
Develop channels for getting information into the right hands, and let the sales team know what information you are seeking about their existing customers and prospects.
Your sales team can also help test your product ideas with their customers. Rather than just sending surveys, ask your salespeople to get their clients to provide feedback on product ideas.
3. Don’t be too cautious.
Apple launched the iPod in 2001. They revolutionized the way people bought and listened to music, and by April 2007, they’d sold 100 million iPods.
Then in the summer of 2007, Apple launched the iPhone. By 2013, they’d stopped developing new generations of iPods, and in 2017 they stopped production.
In product development, you run the risk of cannibalizing your existing market. You might develop a better solution, and it might even be cheaper or more comprehensive.
If you believe you’re on the right path, follow Apple’s example. Imagine if they’d tried to keep iPhones from playing music by blocking people from installing iTunes. Would the iPhone be as successful? Would people try to carry both devices around with them?
As you’re developing new offerings, consider the impact on your existing market. Don’t let it scare you, but make sure you develop a plan for any overlap or cannibalization that will result.
I hope these ideas are helpful as you develop your products and services! One final note: don’t forget to integrate your new offerings into your sales process. Check out our resource for a simple 9-step process to build your sales process.