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 Inventing a Retail Product Step # 4b

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former mentor




PostSubject: Inventing a Retail Product Step # 4b   Thu Apr 30, 2009 10:48 pm




We looked at all the planets that apply to this automotive bag product, and now we have to assess how well the planets actually line up.

In order to do that, we must first assess a value to each planet. We do this by looking at them in terms of 3 distinct groupings. “Unfortunate Planets”, “Maybe Planets” and “Deal Breaker Planets”

Unfortunate Planets: These planets may not quite line up for us. In fact, as the least significant planets, they can be almost completely out of alignment and the project still be market viable.

Maybe Planets: These are the hardest planets to work with. This is where the risk is in the product development process. Intuition and experience are the guide when dealing with “maybe Planets”

Deal Breaker Planets: its either game on, or game off. No matter how well the other planets line up, if a deal breaker planet is significantly out of alignment then that’s it, move on to the next project.

In general terms the value grouping of the planets normally looks much like this.

Unfortunate planets

Competition

Workarounds

Crossovers

Maybe Planets

Packaging

Display

Life Cycle

Deal Breaker Planets

Manufacturing

Distribution

Retail Price

Sell-In Price

In our particular example, the planets actually look more like this – and this is why.

Unfortunate planets

Competition

Workarounds

Maybe Planets

Display

Deal Breaker Planets

None


Competition- We know there are other products on the market that do what this product does, but our research should show us what our experience has lead us to believe and that’s that there are not a large number of competing products in this category.

Workarounds – We know there are consumer workarounds to the product. That in itself would not be enough to overcome the convenience factor this product offers the consumer.

Crossovers – Several crossover opportunities for a product like this, including the baby care category, sporting goods category……and even outside retail in the promotions market.

Manufacturing – Always a deal breaker planet, but in this case the manufacturing processes are well within the material, design, and cost needed to make the product.

Packaging – Packaging for a product like this is pretty simple, and therefore not a driving factor.

Display – We don’t know for sure, there could be a buyer requirement for a display. I hope not, we’ll package it for a hook or clip strip but in the end we’ll have to see if this is a factor.

Distribution – We currently have reps that sell into this category, and the import and fulfillment are all set up with our other products. .

Retail Price – Most of the products in that grouping are under $4.00 – I’m confident we can build a product that we can retail under $4.00

Sell In Price – Experience tells me we can get this product made at reasonable quantities for about 80 cents per package. If our MSRP is $3.99 we have to be able to discount, fulfill, sell, and ship with profit left over for the remaining 78 cent delta. It will be tight, but it can be done.

Life Cycle – The Life Cycle on a product like this is substantial, and since there are no significant tooling costs we should recoup our development costs quickly.

_____________________________________________

In my opinion - This is how the planets line up on this product – they will not always line up this nicely. The trick to “Inventing” a retail product is to be able to do this in your head very quickly…..literally as you are standing there in aisle 12. You can only do that if you understand the process behind each of these 10 planets.

We’re done shopping – back to the office for some research!
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